The arbitration agreement

The arbitration agreement is considered the ‘foundation stone’ of arbitration, typically setting out where, how and under what circumstances arbitrations between parties are to be conducted.

This subtopic contains practical guidance on the arbitration agreement and related matters. The various Practice Notes consider the nature, content and scope of the arbitration agreement, the doctrine of separability of the arbitration agreement, and the relevance of the New York Convention in this particular context. Guidance on how the law of the arbitration agreement may be determined is also provided, as well as content on how to effectively incorporate an arbitration agreement into a contract, the factors that may prevent an arbitration agreement from being upheld, and what disputes may be arbitrated (ie arbitrability). Guidance on the closely-related concept of the seat of arbitration (or arbitral seat) can also be found in this subtopic, as well as information on multi-party and multi-contract arbitrations, the impact of the Contracts (Rights of Third Parties) Act 1999 on arbitration, and unilateral option clauses.

Generally speaking, this subtopic provides guidance on the arbitration agreement under English and Welsh law and the

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Third party costs—Court of Appeal confirms stay pending detailed assessment is case management decision (Federal Republic of Nigeria v VR Global Partners LP)

Dispute Resolution analysis: The Court of Appeal has upheld the decision of a judge at first instance to stay an application for a third-party costs order under section 51 of the Senior Courts Act 1981 until after the conclusion of the detailed assessment of the underlying bill of costs. Dismissing Nigeria’s appeal, the Court of Appeal held that there is no presumption that a third-party costs application should be determined before a detailed assessment. The question is purely one of case management, to be decided in accordance with the interests of justice and the overriding objective. The decision, being within the scope of discretion allowed a judge, was not amenable to appeal; that a different judge would have reached a different conclusion was not in point. Where there is a real question whether any further sum will be payable following assessment (particularly where a substantial payment on account has already been made and costs are to be assessed on the standard basis), it is legitimate to stay the third party application to avoid wasting court resources on what may prove to be a pointless satellite exercise. Of general and at least equal significance to costs practitioners were the Court of Appeal’s strong comments (obiter dicta in strict terms) deprecating disproportionate detailed assessment processes and endorsing the use of sampling as a case management tool in cases involving very significant bills of legal costs. Written by Lauren Godfrey, barrister at Gatehouse Chambers.

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