Chasing evidence overseas for a local arbitration. A fool’s errand?

A practical example of that general principle is where a party to an arbitration is faced with a reluctant witness resident outside the country operating as the seat of the arbitration. What is important for parties in arbitrations to bear in mind here is that many jurisdictions have legislation and process to assist foreign parties in securing witness testimony. The English Court of Appeal was called upon to deal with this issue recently in A and B v C, D and E [2020] EWCA Civ 409 when a party to a New York based arbitration required precisely this kind of assistance. The arbitration concerned a deal facilitated by a third-party negotiator and the negotiator’s evidence was needed.

The negotiator, resident in England, was reluctant to testify and the English courts were asked to compel the witness to testify in terms of section 44(2)(a) of the English Arbitration Act which details the court’s powers in support of arbitral proceedings and specifically “the taking of the evidence of witnesses”.

The Court of Appeal found that section 44 of that Act should be read with section 2(3), which makes section 44 applicable even if the seat of the arbitration is outside of England, Wales and Northern Ireland. On that basis the court came to the assistance of the applicant. Importantly, section 2(3) is subject to the court’s discretion to refuse to assist if in its opinion, the fact that the seat of the arbitration is foreign makes such assistance inappropriate.

Section 14(1)(a)(iv) of the South African Arbitration Act of 1965 empowers an arbitrator to appoint a commissioner to take the evidence of any person in South Africa or abroad. But that assumes a cooperative witness. Our courts may order evidence of a foreign witness to be given by commission but those orders must be dealt with in the foreign country and within that country’s courts’ discretion according to its laws. The International Arbitration Act of 2017 adopts a similar approach in line with the Model Law on International Commercial Arbitration (1985).

The Convention on the Taking of Evidence Abroad in Civil or Commercial Matters was signed on 18 March 1970. It allows for the transmission of letters of request from one signatory state (where the evidence of a particular witness is needed) to another signatory state (where the witness resides) outside of diplomatic channels. The Convention was ratified by South Africa in 1997 but has not been incorporated into South African domestic law and is not available to South African litigants as a result. This Convention was on the agenda of the South African Law Reform Commission as far back as 2004 but we appear no closer to an incorporation of the Convention into our law.

So ultimately, we are reliant on the law of the country in which the witness resides. That law may or may not assist and the extent of that assistance will certainly vary. It is often assumed that a recalcitrant witness overseas is an automatic cul-de-sac but that is not necessarily so. At the very least, it is worth an enquiry to a lawyer in that jurisdiction.