Fairbrother Russell: Arbitration Amendment Bill — Third Reading 
Fairbrother Russell: Arbitration Amendment Bill — Third Reading 
[Volume:642;Page:12186] 
RUSSELL FAIRBROTHER (Labour) 
: 
 I am pleased to have the opportunity to speak on the third reading of the Arbitration Amendment Bill. I move to clause 8; a clause that no one appears to have mentioned in this debate. It inserts new article 35 of schedule 1 which relates to recognition and enforcement of arbitral awards. First of all it makes clear that awards no matter in which country they are given can be recognised in New Zealand and are binding in New Zealand. It also provides what the material is that a party relying on an award must supply to the enforcement court. But what this bill does significantly is that it takes the jurisdiction for enforcement out of the sole court as it was previously—namely the High Court. Of course as many awards are for less than $250000 it is sensible that this bill amends the Arbitration Act to give the District Court jurisdiction in cases where the amount of money—the subject of the arbitration—does not exceed the jurisdiction of the District Court. So the availability of the District Court to parties to an arbitration—should there be a need to enforce that agreement—is hopefully a quicker resolution source. Certainly it is usually a less expensive avenue to enforce the judgment. 
I turn to the issue of confidentiality which has already been discussed considerably in this debate. I think it is worth mentioning again that this bill is a determined departure as is the original Act it amends from the basic principle that justice must be seen to be done. Of course it is a fundamental principle that everyone is entitled to know what is going on in our courts and that is why obtaining suppression orders in the civil court is very difficult indeed and is usually possible only if some statute authorises it. However in this case decisions of arbitration remain determinedly confidential. One may think that that is to abrogate the principle of open justice but on further reflection one can see that the real principle of arbitration is not for a dispute to be resolved in the conventional concept of our justice system but to be resolved in the parameters of keeping a relationship going. So the parties to arbitration are first of all recognising that they are in an existing and often ongoing relationship and recourse to arbitration occurs when they want to resolve disputes without destroying that relationship. If one gets to an adversarial system of justice as happens in the civil proceedings then parties can be driven even further apart than when they started as the dispute materialised. 
The principle for open justice can be easily set aside if one looks at the purpose of the Arbitration Act and this Arbitration Amendment Bill. The purpose simply is to ensure that disputes between parties can be resolved speedily and with a degree of informality by leaving every avenue available for the parties to keep their relationship as harmonious as is possible given the disputes they face. This offer of confidentiality is very important in many many cases—in particular commercial cases—and that adds a further inducement to speed the process along and to ensure that errors of dispute are minimised. So the risk that arbitration will not come about because one party is taking a dogmatic approach on a point which is not the main point of dispute is overcome because the risk of going to the court is to leave open for public examination the contractual affairs between parties which normally would remain private to those parties. The principle of open justice can safely be set aside in the Arbitration Amendment Bill because the principle at work here is to allow parties to resolve disputes with a degree of informality and with confidentiality. 
The confidentiality provisions are extensive. The parties cannot disclose any of the material between themselves except as defined in the clauses of this bill without the leave of the arbitrator. Of course once the arbitration process is complete then that arbitrator is functus officio. If there is any issue as to what can be disclosed subsequently then new section 14E inserted by clause 5 provides for that by way of application to the High Court. The court has a wide discretion after considering all the matters as to how much the disclosure and confidentiality should be lifted. The provision is very wide and is underscored again by new section 14E(2)(b) which provides: “the disclosure is no more than what is reasonably required to serve the other considerations referred to in paragraph (a).” The High Court is given wide powers but subsection (2) is a strong reminder that those powers are not to be a springboard to the concept of open justice. 
We find the definition of “confidential information” in the interpretation clause. It inserts two definitions which are the key to this amending legislation. The first is “confidential information” in relation to arbitral proceedings and the second is “disclose”. The definition of “confidential information” is worth canvassing in this debate. It means “information that relates to the arbitral proceedings or to an award made in those proceedings”. It includes such things as pleadings submissions and evidence—and that often is what is most important to retain some degree of privacy about. It includes any notes made by the tribunal any transcript any rulings of the tribunal on the way to the final resolution and of course the award of the tribunal so that one party cannot then run off and publicly proclaim that that party has scored a significant win over the other side. It would even be improper as many litigants tend to do in these procedures to say: “I can’t disclose what the award was but I’ve got to say that we’re very happy with the outcome.” When I have read those comments in newspapers I have often thought that is a party that is pushing the contempt proceedings to the absolute limit. So we find that the definition of “confidential information” is as extensive as the prohibition on publication is penetrating. 
The definition “disclose” in relation to confidential information is inclusive of all aspects such as publishing communicating or otherwise supplying the confidential information. One cannot pass on to another party in a stated relationship of confidence information that was obtained during the arbitration proceedings. This definition of “disclose” is inclusive and exhaustive and it does not leave and should not leave any way for a party to exploit the vulnerability of the other side in arbitral proceedings when the party in fact discloses information in the course of having an arbitration become effective and a party cannot then by swearing a third party to secrecy pass information on. This bill clearly defines the term “disclose” and puts absolute parameters on what can be done. 
This is an important bill. It is a bill that reflects the thoughts of the Law Commission 4 years ago and it certainly carries through into statute what is a desirable practice in the civil litigation community.