Young ICCA Skills Training Workshop: Witness Statements and Document Disclosure

A second Young ICCA skills training workshop was held in Prague on 24 October 2011, on the topic of "Witness Statements and Document Disclosure in International Arbitration". A strong contingent of local Prague-based practitioners joined Young ICCA Members from Europe, Africa, Asia and the Americas for a detailed discussion led by dynamic young practitioners Martin Valasek (Norton Rose OR, Montreal), Noradèle Radjai (Lalive, Geneva), Niuscha Bassiri (Hanotiau & van den Berg, Brussels), Jan K. Schaefer (Allen & Overy, Frankfurt), Roland Ziadé (Cleary Gottlieb, Paris) and Rostislav Pekar (Squire Sanders, Prague). Prof. Bernard Hanotiau (Hanotiau & van den Berg, Brussels) played an active role during the workshop, providing the benefit of his experience to the participants.

Thanks go to the organizing committee of Jan Schaefer, Matthew Hodgson, Martin Valasek, Maria Lokajova, Niuscha Bassiri and Svatava Sprague, guided by Young ICCA's Events Coordinator, Tim Foden.

Post Event Report

by Olga Troshchenovych and Guillermo Salcedo Salas

Introduction

The third Young ICCA event kicked off with an informal reception at Letenský zámeček, a small castle-styled location. Situated in one of Prague’s most beautiful parks, Letenské sady, it provided participants with a unique view over the city’s historic centre. Martin Valasek, from Norton Rose OR in Montreal, welcomed the speakers and organizers of the event as well as Young ICCA members in the picturesque surroundings explaining how the idea of a Young ICCA event in Prague was born and how excited everyone was that the program had been successfully implemented into action.

Although most of the Young ICCA participants came from Europe, some of them did not even shy away from hitting the road all the way from South Africa or Rwanda. And the event was worth it. Items on the agenda for the workshop presented two essential topics of international arbitration which at the same time tend to be rather highly disputed in practice – witness statements (B) and document disclosure (C).

The whole event benefited tremendously from the presence of highly experienced practitioners from common law and civil law cultures as well as, and especially, from the participation of such a prominent figure of international arbitration as Prof. Bernard Hanotiau. This gathering of legal practitioners, of which some act as counsel and others as arbitrators, gave rise to some fruitful and practical discussions lit up from various perspectives.

Witness Statements

The first session of the workshop was dedicated to witness statements. At the beginning of the session Noradèle Radjai, of Lalive in Geneva, elaborated on the general role and relevance of witness statements in international arbitration proceedings. In her presentation Noradéle Radjai addressed the issue by defining the three basic “W questions”: What is a witness statement with regard to international arbitration? ; Why are witness statements useful? ; Who should counsel chose to be a part of the process?

What is a witness statement with regards to international arbitration?

Witness statements have become a frequently used mean of presenting direct evidence in international arbitration proceedings. It is written evidence that reflects a person’s knowledge or personal experience of issues dealing with a case. During arbitration it is common to find factual witness statement and expert witness statement, however, during the workshop, we focused on factual witness statements. Delivering fact testimonies to arbitral tribunals through written witness statements can be achieved under different forms of drafting. It is important to point out that through a witness statement an arbitral tribunal may get its first impressions of the quality of the debates during a case. Needless to highlight how important that first impression is.   

 Usually, witness statement will be presented following the procedure set out by arbitral tribunals in procedural orders, by applicable rules or by the IBA Rules on the Taking of Evidence in International Arbitration (i.e. Article 8 of the IBA Rules on the Taking of Evidence in International Arbitration).

Why are witness statements useful?

As to why, witness statements may serve different purposes: they can help the parties to bridge evidentiary gaps; present complex factual issues in a simplified and more persuasive manner; support established lines of argument; rebut evidence presented by the opposing party and prevent cross-examination traps. Finally, with the help of a witness statement a party may serve arbitrator’s sense of equity by telling a convincing story – an aspect which is decisive both for parties’ submissions as well as witness statements.

Who should counsel chose to be a part of the process?

As to the “who” question, an all important first step during the preparation of a witness statement is to interview the witness. Noradéle Radjai indicated that it is very useful to have a knowledgeable “insider” on the client’s side that might help both understanding the dispute and selecting witnesses. Since witness statements may play a crucial role in the proceedings it is further essential to pay attention to various details during the interview to consider whether the witness in question may contribute to factual discovery and to the line of arguments favourable for the party. Last but not least, counsel should carefully evaluate whether the credibility of the particular witness in question may be seriously questioned during the proceedings.

In practice, usually more junior associates are entrusted with interviewing witnesses. The importance of the process should not be underestimated though. In relation to witness interviews many aspects play a great role. Timing is of great importance. Although opinions in relation to the exact point in time may differ, the general consensus is that an interview should take place as soon as possible to keep witnesses recollection of the facts “fresh”. In addition, a lawyer representing a client should make his own picture of the story to prevent production of contradictory submissions or discovery of new facts at the later stages of the proceedings.

Prior to the interview, it should be considered whether and if to which extend information should be provided to a witness. In relation to the correct approach in this regard opinions differ. Partially, it is considered that background information provided to the witness prior to the interview might help to refresh the memory in relation to particular events. Partially, practitioners advise against such assistance as it might lead to the manipulation of a witness statement and obstruction of truth.

To what extent is counsel’s assistance admissible? Different approaches of common law and civil law systems

Question of assistance leads directly to one of the most disputed issues between common law and civil law representatives – extent of the admissible contact and collaboration between counsel and witness in preparation of a witness statement.

In common law legal cultures witness statements play an essential role as they represent the first step in preparation for the oral hearing and cross-examination of the witnesses which stands for a decisive test of witnesses’ credibility and often for the success of a case as such. Assistance of a witness in common law countries goes as far as an obligation of lawyers.

In civil law, however, witnesses play a much lesser role. Witnesses are often called to testify only when no written evidence is available to support the case or to understand the reasons that motivated unclear provisions. Documentary evidence is generally considered more reliable than witness statements. Accordingly the concept of cross-examination is not that well established and plays a much lesser role in civil law proceedings. At the same time assistance of lawyers in preparation of witness statements and preparation of witnesses for oral hearings is treated very critically and can be seen as manipulation of evidence. However, civil law countries are starting to accept witness preparation in international arbitration as shown by a  resolution adopted on February 26, 2008, by the  Council of the Lawyer’s Order of the Paris Bar (Conseil de l’Ordre des Avocats du Barreau de Paris).2

Drafting witness statements

Despite the differences between both legal cultures, during the discussion led by Roland Ziadé, of Cleary Gottlieb in Paris, who handled the topic of drafting of witness statements, all participants seemed to agree that to some extent such assistance by a lawyer is indispensable. This way one can ensure that complete information required by the respective procedural rules is submitted to the tribunal. In addition, a lawyer can prevent the overflow of information submitted in a witness statement and limit its scope only to the facts relevant to the dispute.

When assisting witnesses in drafting of the witness statements, a lawyer should keep in mind though that tribunals can be rather critical to such assistance. In order to avoid jeopardizing credibility of witnesses a legal adviser should prevent such situations when various witness statements of almost the same content are submitted to the arbitral tribunal. Witness statements submitted during the proceedings may also loose their credibility if the signature of the witness is contained on a separate page sent by fax. To prevent these situations timing is essential for a good counsel.

Other decisive aspects of drafting witness statements include the importance of using simple layman terms, counsel’s moral obligation to stick to the witness’ view, restraining from adapting the statement to the client’s cause and tackling the difficulties that arise when witness statements need to be translated.     

In his comments, Prof. Bernard Hanotiau appealed to all participants urging them to always keep effectiveness of the proceedings in mind. Thus, counsel should refrain from filing witness statements if they are not relevant to the case or if sufficient documentary evidence was provided. Finally, witness statements shall be limited to new facts and not reiterate the obvious. If, for example, it is obvious from business minutes that a given person was present during the meeting, there is no necessity in reiterating this fact to the tribunal once again.

At the end of the session some specific questions were raised and discussed by the participants revealing that in some situations no uniform approaches can be established and a solution could vary on the case by case basis. In relation to exhibits referred to in witness statements some were of the opinion that it is important for each witness statement to be filed with its own set of exhibits. At the same time, some deemed it as a production of unnecessary duplicates and it shall be sufficient to refer to the exhibits of overall submissions.

Participants also raised the topic of how to handle situations in which an opposing party is refraining from cross-examining a witness because of its importance and knowledge of the facts. This is a strategy that would be aimed to leave the witness participation to the process in the witness statement, avoiding further discussion during the cross-examination phase, thus, apparently, decreasing the witness’ statement legal relevance to the dispute.

Prof. Bernard Hanotiau indicated that tribunals are aware of these tactics. Although these situations may have an impact on the overall perception of the case, an arbitral tribunal may set a hearing for the uncalled witness in order to examine him directly and have a better understanding of the case, but it cannot order an opposing counsel to cross-examine.

Document Disclosure

After a short break a profit-yielding discussion set forth with the issue of document disclosure in international arbitration. As was the case with the witness statement discussion, it was accompanied by different perspectives on this subject in common law and civil law countries.

Differences between common law and civil law systems

The concept of document disclosure which is, as put by Jan K. Schäfer, of Allen & Overy in Frankfurt, who provided an introduction to the second session of the workshop, a more favourable term than “document discovery” originated from the common law countries. In most civil law countries this concept does not exist, at least not to such extent.

Some civil law jurisdictions have limited regulations which provide for a rather narrow obligation of a party to produce specific documents.  These obligations cannot be compared though to pre-trail “fishing expeditions” which might be possible in common law jurisdictions. Thus, if a party bearing the burden of proof fails to present evidence, it will in most of cases lose in this very aspect of the proceedings.

Consequently, arbitral proceedings involving parties from different legal background may lead to big controversies in relation to document discovery. Such controversies may appear because of the lack of understanding on the client’s side or even because of the infringement of privacy laws.

Important steps to a successful document disclosure request

Niuscha Bassiri, of Hanotiau & van den Berg in Brussels, as well as Rotislav Peka?, of Squire Sanders in Prague, shed some light on this controversial issue and established relevant steps leading to efficient and successful document disclosure proceedings.

Despite the controversies in the different legal cultures, all participants agreed that document disclosure as such is of great importance in international arbitration proceedings. As an example, the participants referred to international investment arbitration proceedings in which generally claimant will have much more limited access to relevant information in comparison to a respondent State.

Timing

In relation to the timing of the document disclosure request participants agreed that the filing of the latter shall take place as early as possible. However, it cannot extent to the pre-trial “fishing expedition”. Therefore, by the time of the filing, proceedings must be advanced to the stage when parties can actually identify relevant documents and file a request fulfilling necessary requirements imposed by the relevant procedural rules or an arbitral tribunal. Prof. Bernard Hanotiau indicated that an arbitral tribunal would usually instruct the parties to voice their intention to file document disclosure requests at an early stage of arbitral proceedings.

Redfern Schedule for Documents Requests

On the basis of the requirements set out by the IBA Rules on Taking of Evidence (i.e. Article 3), participants discussed the importance of the Redfern Schedule for Document Requests throughout the process of document disclosure. With regards to the schedule, the five typical stages of the document disclosure were discussed:

• Identification of documents or category of documents requested;
• Relevance and materiality, including references to submissions by the requesting party;
• Reasoned objections to document production request by opposing party;
• Response to objections to document production request by requesting party; and
• Decision of the arbitral tribunal.

Specific emphasis was put on issues of identification and precise description of the requested documents. Especially in the era of electronic document storage it is essential to be able to identify the documents as exact as possible to prevent a long-lasting search for a needle in a haystack.

Objections to document disclosure request

The focus of the discussion was further put on questions of privileges and other disputed reasons for objections to document disclosure requests resulting from different approaches in various jurisdictions. Discussion touched inter alia highly controversial topics of the legal status of in-house counsel and the extent of third party privileges.  

Overall, Prof. Bernard Hanotiau described this topic as one of the most challenging in international arbitration. A general approach is impossible to establish in handling these issues as each individual case will have to respect relevant rules and policies. In addition, despite the possibility to file a document disclosure request, the actual powers of an arbitral tribunal in assisting a party to obtain requested information may vary and can be very limited according to rules applicable to the procedure.

Article 9 (5) of the IBA Rules on the Taking of Evidence in International Arbitration, for example, provides that if a party fails to produce requested documents without satisfactory explanations and does not object to such a request in due time, an arbitral tribunal may infer that such documents would be adverse to the interests of that party. In some jurisdictions arbitral tribunals can ask for the state courts’ assistance to order parties to produce documents or to order witnesses to appear to the hearings. In other jurisdictions this procedural step is not available.

Finally, the participants discussed to which extent request for document disclosure should be provided with additional reasoning. In practice, various approaches were developed: sometimes it is sufficient to file a table with respective definition of documents and relevant reasoning; sometimes counsel will have no other choice but to file an additional memorandum with reasoning, especially when controversial issues arise when potentially privileged information is involved.

As an overall remark, one can determine that effectiveness of arbitral proceedings shall also serve as a control mechanism when it comes to question of document disclosure. Document disclosure process can be very long lasting and time consuming. Thus, it is imperative not only to prevent usage of document disclosure proceedings for dilatory tactics, but in general to guarantee an effective dispute resolution mechanism for reasonable costs as a main goal of international arbitration.

Conclusion

Concluding, one can state with assurance that the third Young ICCA workshop was a great success. Both experienced lawyers as well as those who did not yet deal with the discussed issues could benefit from the discussions led by practitioners coming from different legal cultures and sharing both counsel’s as well as arbitrator’s perspective in international arbitration. Such events promote understanding for various positions providing a possibility to evaluate different approaches and strike the best balance between “both worlds” for the purposes of international dispute settlement.

Finally, the workshop benefited tremendously form the presence of Prof. Bernard Hanotiau as knowledge gained with experience is a very seldom and unique value. Sharing of knowledge and experience with young practitioners is essential for the future of international arbitration. It is important to enhance such an intellectual exchange between various generations to improve and further develop international arbitration as an effective mechanism of international dispute settlement.