Finlayson Christopher: Arbitration Amendment Bill — In Committee 
Finlayson Christopher: Arbitration Amendment Bill — In Committee 
[Volume:639;Page:9774] 
CHRISTOPHER FINLAYSON (National) 
: 
 This bill is one of three bills that are the responsibility of that rising star of the Labour Cabinet the Hon Clayton Cosgrove. The first of these is the Arbitration Amendment Bill and I want to say something about the report of the Justice and Electoral Committee. Of course if the Minister is the rising star of the Labour Party it says a lot about the state of the Labour Party. 
Let me first deal with the issue which is referred to in the report about the control of the arbitral tribunal in relation to witness subpoenas. We thought on reflection that clause 8(1) should be deleted from the bill. The clause is intending to amend article 27(1) of schedule 1 of the Arbitration Act and in particular the issue is whether the words “with the approval of the arbitral tribunal” should be deleted. Article 27(1) provides that the arbitral tribunal or a party with the approval of the tribunal is able to request from the court assistance in the taking of evidence and the court may execute the request within its competence and according to its rules on taking of evidence. 
The bill had suggested initially that the phrase “with the approval of the arbitral tribunal” should be deleted but the select committee having heard evidence on this thought the clause should remain as it is because we consider it important that the parties be required to seek approval of the tribunal before they go to the court. The very good reason for that is that it enhances the tribunal’s control over the arbitration process and maintains current practice. So that is the reason why the committee thought that clause 8(1) should be deleted. 
During the course of the submissions we were very lucky to receive extensive submissions from Mr David Williams QC an eminent arbitrator both domestically and internationally in this country. He dealt with the issue of interim measures. It was very fortuitous at the time this bill was being dealt with in the select committee that the United Nations Commission on International Trade Law (UNCITRAL) had just published proposals for dealing with interim measures and that is why it was timely for us to bring into the bill the proposed changes to article 17 of the model law. 
Article 17 as it is currently framed is particularly brief. It simply states that the arbitral tribunal may order interim measures and it provides very little guidance. Well UNCITRAL has got together and proposed a number of changes to elaborate on the powers of the tribunal when dealing with interim measures and these are set out in chapter 4A. So section 17 in clause 8 provides very detailed definitions of what interim measures are. They are very similar in effect to interim injunctions which may be granted by the court; both interim injunctions freezing orders—or Mareva injunctions—and Anton Piller orders and they are very adequately defined. 
Then section 17B in clause 8 sets out the conditions for the granting of interim measures which are very like the powers of the court when granting interim injunctions. One of the provisions that is quite important is section 17C in clause 8 which states that the arbitral tribunal may issue a preliminary order and that a party may without notice to any other party apply for such a preliminary order. 
The National Party supports these provisions and thinks they are very sensible. In fact one of the discussions we had in the select committee was about whether these were the kinds of changes that could be brought into the domestic law of New Zealand without the need for parliamentary sanction and whether they could be dealt with by way of regulation or rule. Having obtained the advice of the Clerk of the House however we decided that notwithstanding that UNCITRAL will come up with changes to the model law from time to time it is appropriate for parliamentary sanction to be obtained before the domestic law of New Zealand is changed. 
Sitting suspended from 6 p.m. to 7.30 p.m. 
CHRISTOPHER FINLAYSON 
: I will be fairly brief because I have only a couple of— 
Hon Clayton Cosgrove 
: Take your time. 
CHRISTOPHER FINLAYSON 
: The Minister in the chair the Hon Clayton Cosgrove tells me to take my time. I have only a couple of matters to refer to. Before the dinner break I said something about the control of the tribunal in relation to witness subpoenas and I had begun an analysis of the changes proposed in the bill to deal with interim measures. 
As the report of the Justice and Electoral Committee states some detail is provided as to how and when parties may seek interim measures the conditions for granting them and the power of the tribunal and there is an important provision about the ability of the tribunal to require the applicant for an interim measure to provide appropriate security in connection with the measure and that is set out in section 17I in clause 8. The select committee was very happy to bring those measures into the bill. As I said before the dinner break it was very timely that at the very time the select committee was dealing with this amendment legislation the United Nations Commission of International Trade Law produced some proposed changes to the model law. 
The third matter I want to touch on briefly is the default procedure for appointment of arbitrators. Again we proposed that clause 9(2) be omitted from the bill. Clause 9(2) deals with the default procedure for the appointment of arbitrators. Essentially it had proposed amending clause 1 of schedule 2 to the primary legislation. The second schedule of the Act provides certain additional optional rules that apply to arbitration and clause 1 deals with the default appointment of arbitrators. Essentially we are saying that the existing clause is adequate and that we do not see the need for the changes proposed in the bill. Therefore subclauses (1) and (2) of clause 9 have been struck out. 
That is all I want to say at this stage. I will deal with some of the substantive matters proposed in the bill when we deal with the purpose clause and the title. But those were the primary decisions made by the committee for changes to the bill—as I said dealing with subpoenas interim measures and the default procedure for the appointment of arbitrators—and I think we have a better bill as a result.