An arbitrator who knows the parties well, being intimately involved in their relationship and difficulties, can be valuable. Knowledge of the problem and business might lead to a more commercially correct award than that rendered by a disinterested party. However, should this intimate arbitrator decide on issues relating to his own jurisdiction?
In Weissfisch v Julius & Ors 2006 two disputing brothers, Amir and Rami Weissfisch, entered into a settlement scheme which embodied final arbitration by Mr. Julius, an English solicitor well-known to both brothers, with its seat in Switzerland. During the proceedings, Amir attempted to remove Julius as arbitrator on grounds of bias. Before the English court, Amir sought to void the settlement agreement because of alleged misrepresentation by Julius and Rami, and to remove Julius as arbitrator on the basis that by accepting an appointment as arbitrator between two intimate clients, Julius fatally breached standards of solicitors' professional conduct. Given that the arbitration is seated in Switzerland, Julius requested the court not to entertain Amir's pleas.
The question of whether Amir should advance his claims in England or Switzerland is pending before Colman, J. In the interim, it had to be decided whether Julius should be restrained from going ahead with the proceedings and deciding on his own jurisdiction. The High court (by Steel, J) held that it is extraordinary to deviate from the English principle that the courts of the seat of arbitration have supervisory jurisdiction.
Granting injunctions against arbitrations taking place outside England is such a deviation. There were no extraordinary facts in the case and the balance of convenience was against the grant of injunction. The Court of Appeals upheld this decision. It rejected the argument that Julius will be both judge and witness in his own cause, and concluded that pending the hearing before Colman, J, it was not untoward for Julius to consider questions of his own jurisdiction.