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ANNUAL REVIEW

Litigation & Alternative Dispute Resolution 2017

November 2017  |  LITIGATION & DISPUTE RESOLUTION

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In many jurisdictions, arbitration has emerged as the pre-eminent means of resolving commercial disputes. Companies are often drawn to arbitration thanks to its international application, particularly if speed is required and the neutrality of local courts is a concern. Parties that opt for arbitration are able to resolve potentially embarrassing disputes in a timely and private manner, capitalising on the advantages offered by ADR. With arbitration becoming an increasingly popular means of dispute resolution, new seats are taking hold in various markets around the world, suggesting ADR will go from strength to strength moving forward.

 

UNITED STATES

Melissa H. Maxman

Cohen & Gresser LLP

“There has been a lot of activity in the federal agencies due to the change in the US presidency. With newly appointed executive branch officials, companies must adapt to quickly changing agency policies and priorities in all areas, from environmental regulations to competition laws. The hot areas for dispute are in the healthcare and high tech industries, often with an emphasis on intellectual property rights. One area of particular concern is what will happen to the Affordable Care Act (ACA) under the new president. Although Congress has failed to repeal or modify ACA several times in 2017, Trump has signed a new executive order on healthcare.”

 

MEXICO

Marco Tulio Venegas

Von Wobeser y Sierra

“There has been a slight increase in collective actions, which are relatively new for the Mexican legal system. These collective actions refer to the automotive, agricultural and infrastructure markets. Furthermore, due to the recent earthquakes in the country, it is possible that lawsuits against construction and insurance companies may arise. Due to the nature of these disputes, it is likely that most of them will be heard by state courts. In terms of purely commercial disputes, we have seen an increase in corporate conflicts involving either shareholders of large corporations or parties to a joint venture agreement.”

 

BRAZIL

Walfrido Jorge Warde

Warde Advogados

“The 10 most common themes we are seeing in commercial disputes are: forcing a company’s management to report and disclose documents; disagreements over the valuation of assets corresponding to the stake held by a shareholder leaving a company in the event of its partial dissolution; reinstating a shareholder excluded from a company; partial dissolution of a privately owned company following the withdrawal, exclusion or death of a shareholder; enforcing the right of recourse or of indemnification of a purchaser or seller of control of a company under liability transfer covenants; disagreement over the interpretation and application of price adjustment clauses.”

 

ARGENTINA

Ricardo A. Ostrower

Marval O’Farrell & Mairal

“We have seen a significant upswing in natural resources and energy disputes, mainly related to the state’s regulatory activism. Moreover, as a considerable number of infrastructure projects were put in place in recent years, it is foreseeable that the number of commercial disputes in the construction field may also increase. Arbitration is the preferred dispute resolution method for these types of complex disputes, as they involve highly technical topics which state courts may not be well-placed to resolve. On the other hand, there is still a strong pipeline of litigation coming from collective actions regarding the protection of consumer rights.”

 

UNITED KINGDOM

Paul Ferguson

SCA Ontier LLP

“Not necessarily recurring themes, but we have certainly seen a drop off in disputes arising out of the financial crisis and an increase in disputes arising out of the uncertainty created by Brexit. There has also been a growth in litigation funding and, perhaps, more fundamentally, a growth in the awareness of litigation funding as a viable means of bringing a claim. Whereas a few years ago Russian businesses and businessmen were dominating the disputes sector, we have seen more disputes from developing nations. One other noticeable change is that we have seen that parties are more inclined to make allegations of fraud in order to raise the stakes and seek a wider range of remedies than was the case even a few years ago.”

 

FRANCE

Serge Gravel

FLV & Associés

“It would seem that challenging the arbitrators’ jurisdiction is a recurring theme; this may relate to the parties involved in the arbitration proceedings or concerning certain aspects of the disputes. Licensing, franchising and distribution arrangements are generating more and more international disputes. It used to be that international arbitration involved a restricted number of seasoned practitioners, most of whom were respectful of the diverse legal systems and business usages, and were applying widely recognised rules of ethics. Things have changed, and the practice of international arbitration is no longer restricted to the happy few.”

 

SWITZERLAND

Urs Weber-Stecher

Wenger & Vieli

“One of the biggest concerns of users of arbitration continues to be costs. Thus, it is pleasing to see that parties frequently use the expedited procedure of the Swiss Rules 2012. Indeed, a significant number of cases submitted to the Swiss Chambers’ Arbitration Institute (SCAI) in 2015, namely 43 percent, have been conducted under the expedited procedure. Moreover, third-party funding is being used more frequently in international arbitration. Switzerland has previously taken quite a liberal approach to third-party funding and has refrained from introducing any duties governing the practice.”

 

AUSTRIA

Désirée Prantl

Freshfields Bruckhaus Deringer

“In arbitration, the majority of the disputes administered by the Vienna International Arbitral Centre (VIAC) over the past few years have been in the general trade, finance, machinery and construction and engineering sectors. In terms of recurring themes, issues of contract interpretation, particularly regarding parties’ obligations, remain dominant in commercial disputes before arbitral tribunals, as well as in state courts. In the field of energy-related disputes, the doctrine of frustration has gained importance as a legal basis for price adjustment or termination requests of long-term contracts. In general, we have seen greater involvement of states and state entities in arbitration than there used to be.”

 

GREECE

Eliana Paschalides

Papapetros, Papangelis, Tatagia & Partners Law Firm

“As a result of the financial crisis, which has continued for the last seven years in Greece, the number of commercial disputes has increased immensely and courts all over the country are overloaded with cases. The main disputes concern cases where banks and financial institutions have requested repayment of outstanding loans and facilities. A certain number of cases have been referred to debt collection enforcement proceedings. We have also seen public auctions of property and other assets. Another large number of cases are commercial disputes regarding sales of goods, namely a failure to pay invoices and bouncing cheques.”

 

AUSTRALIA

Angela Pearsall

Clifford Chance

“There are a number of recurring themes, including an increase in the number of disputes funded by litigation funders, which are, themselves, increasing in number, and an increase in competing class actions. We are seeing a steady number of class action claims based on misleading and deceptive conduct, and failures to comply with the Australian Securities Exchange’s (ASX) continuous disclosure obligations, as well as non-traditional claims, in relation to climate change and natural disasters, gaming addiction and the detention of refugees.”

 

UNITED ARAB EMIRATES

Ben Bruton

Winston & Strawn LLP

“As a dispute resolution forum, the UAE has a uniquely diverse landscape. While the country is a civil law system, the Dubai International Financial Centre (DIFC) and the Abu Dhabi Global Market (ADGM) are financial free zones in which common law, based on English law, is applied. As a result, international companies within the UAE have the ability to select the appropriate dispute resolution method based on their sector and the business relationship in question. Dubai has also positioned itself successfully as a regional arbitration hub with two well-established centres, the Dubai International Arbitration Centre (DIAC) and the DIFC-LCIA.”

 

GHANA

Charles Zwennes

Gaisie Zwennes Hughes & Co

“Fundamentally, there is insufficient regard held in this region for the sanctity of contract. This tends to be of great concern to many a practitioner, since this concept underpins the entire areas of contract law, land law and the much wider area of contractarian ethics in general. The legal practitioner in this region invariably tends to find that changes in the business circumstances between contracting parties caused by sometimes even the slightest of changes in external market forces gives one party a false sense of right to dishonour the terms of the contractual bargain. This is certainly the wider theme in commercial disputes within this jurisdiction.”


CONTRIBUTORS

Clifford Chance

Cohen & Gresser LLP

FLV & Associés

Freshfields Bruckhaus Deringer

Gaisie Zwennes Hughes & Co

Marval O’Farrell & Mairal

Papapetros, Papangelis, Tatagia & Partners Law Firm

SCA Ontier LLP

Von Wobeser y Sierra

Warde Advogados

Wenger & Vieli

Winston & Strawn LLP

 


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