Obtaining of a copy of a confidential arbitral award by a third party

One of the basic principles of arbitration is that the proceedings and the award are in principle confidential. However, a recent judgment given by the Middle Netherlands district court shows that under certain circumstances it is nevertheless possible to obtain a copy of an arbitral award without being a party to the proceedings. Arbitration lawyer Onno Hennis explains the case.

What was the matter?

In this case, Strukton construction company wanted to obtain a copy of an arbitral award rendered in proceedings between ProRail railway operator and VolkerRail contractor. This award could demonstrate that ProRail possibly used an unreasonable contract interpretation in respect of Strukton.

Confidentiality

In principle, arbitration is confidential. To be more specific, ProRail and VolkerRail had conducted legal proceedings under the NAI Arbitration Regulations, in which an explicit provision has been included stating that all persons directly or indirectly involved are obliged to keep all particulars relating to the arbitration secret.

Tender

Nevertheless, part of the contents of the arbitration became public in a later tendering procedure. VolkerRail had asked ProRail to adjust the draft documents of the tender with due observance of the judgment of the arbitral tribunal, which stated that ProRail used an unreasonable contract interpretation. As Strukton was also competing in this tendering procedure, it became aware of this fact. Because Strukton has contracts with ProRail that are identical to the contracts of VolkerRail, Strukton wanted to know on which points the arbitral tribunal had ruled that ProRail used an unreasonable contract interpretation.

Request for inspection of the arbitral award

Strukton then asked ProRail for permission to inspect the arbitral award. ProRail refused, invoking the agreed confidentiality. VolkerRail appeared to have no objections to the inspection of the arbitral award. VolkerRail also said that the arbitral award did not contain any company-sensitive information.

Preliminary relief proceedings

Strukton then brought preliminary relief proceedings, demanding inspection or at least surrender of the arbitral award. It claimed that it met the requirements for an application to inspect and that there were no serious reasons for ProRail to refuse inspection.

Considerations of the court

First and foremost, the court in preliminary relief proceedings did acknowledge that confidentiality of arbitral proceedings and their outcome is important. But then the court stated that such confidentiality in principle only applies between the parties to the arbitration. A third party is not bound by that confidentiality. The court furthermore found that Strukton has a legitimate interest in the application to inspect, since Strukton and ProRail have been having discussions about the interpretation of certain contractual provisions for quite a while. The arbitral award could show how those definitions should be interpreted, which could also help to resolve disputes and avoid unnecessary proceedings.

No serious reason

The court also ruled that ProRail did not have a serious reason for refusing the inspection. Apart from invoking the strict confidentiality, ProRail could not explain properly what objections it had against sharing the award. The court also finds that as a railway operator, ProRail should strive for equal treatment of parties that bid for its tenders. According to the court, it is not consistent with such equal treatment that one party does and the other party does not have the same information at its disposal.