Doctrine of Competence

Topics: Arbitration, Common law, Contract Pages: 6 (2160 words) Published: June 25, 2011
Doctrine of Competence-competence
The proper allocation of responsibilities between courts and arbitral tribunals for resolving disputes concerning arbitral jurisdiction – disputes about whether the plaintiff’s claim ought to be decided by an arbitral tribunal or a court – has been one of the most complex and controversial question of modern arbitration law. Although there is broad agreement on one general proposition that arbitrators are empowered to rule on their own jurisdiction and then proceed to settle the substantive dispute (UNCITRAL Model Law 16(1), French Code Art 1466, English Arbitration Act 1996, S 30(1), Swiss PIL Art 186(1)) – decades of debates failed to produce a genuine consensus among commentators, courts and policy-makers. The doctrine of competence-competence recognises the jurisdiction of the arbitral tribunal to rule on its own jurisdiction. It holds that the arbitrators have jurisdiction to decide challenges to their own jurisdiction, to decide challenges to arbitration agreements on which their own authority to resolve the parties’disputes is based. National court must enforce arbitration agreement and awards, it will do so only if the arbitral tribunal has jurisdiction. The power of arbitral tribunal to decide upon its own jurisdiction is an ‘inhenrent’ power. Under the civil law system generally accepted that the arbitral tribunal has its own jurisdiction, and as per J Paulson in the absence of any irregularities, the courts are usually not likely to interfere with the arbitral tribunal’s ruling on jurisdiction. However this is not the case in common-law countries, the courts insist that they should have the final say on whether the arbitral tribunal has jurisdiction. As per Lord Justice Saville the questions of the jurisdiction cannot be left to the tribunal itself. When deciding if whether the arbitral tribunal is empowered to rule on its own jurisdiction, the judge should look into the contract between the parties. Firstly is to examine if there the dispute is arbitrable and secondly to ensure that the arbitral tribunal has the jurisdiction. Article 8(1) of the UNCITRAL Model Law provides that court should refer the parties to arbitration unless it finds that the arbitration agreement is null and void, and inoperative. However, it does not explain the meaning of ‘unless the agreement ‘is’ null and void’. What is ‘is’ mean in this section? Does it means that the court must satisfy that it is a matter of the court to decide whether the arbitral tribunal has jurisdiction? Or should it refer the parties to arbitral tribunal and allow for the tribunal to rules at it’s own jurisdiction? One will answer that the answers are depend on the where you are and how the arbitration agreement is worded (Dell Case). Moving on, one will compare the approach taken in different jurisdiction in deciding this. In the UK, we have Section 30 of the Arbitration Act 1996 which is based on Article 16 of the UNCITRAL Model Law, however the competence-competence doctrine is not mandatory under the Act. It seems that England has adopted a competence-competence rule which enables the arbitral tribunal itself to decide whether it has jurisdiction. However, the decision in Midgulf indicates that the England is slow in accepting the doctrine of competence/competence, and the courts still pursue the development of English Contract law at the expense of parties. However is the tribunal’s decision subject to judicial review? In other words, once the tribunal has ruled that it has jurisdiction, what are the recourse the parties have? As question by Bachand, on what ground can the losing party challenge the decision, and to what extend the decision can be challenge? To what extent can the court review the tribunal’s decision in ensuring that the arbitral tribunal in Model Law have jurisdiction to rule? In considering the position of England, it is important to look at the Dallah case (2010), Pakistan denied being a party to...
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