PANAMA Trends and Developments Contributed by: Jorge Molina Mendoza and Alberto de Urriola Rubio, FABREGA MOLINO
If the above were not defence enough, the claimant also stated that, in collaboration with its US lawyers, a Panamanian firm also intervened in defence of its interests; and that, due to the COVID-19 pandemic, the foreign lawyers were never physically in Panama. It was also emphasised that the arbitration was of an international nature, so the presence of foreign law - yers in the arbitration proceedings was reasonable. The circumstance described, in the plaintiff’s opinion, did not violate the right to defence. On the contrary, it ensured it. The plaintiff therefore requested the rejec - tion of the motion presented by the insurance com - pany. In its reasoning, the court upheld the arbitral tribu - nal’s position, which had previously considered that there was no reason to annul the actions of the claim - ant because it had been assisted by US lawyers. In fact, the rules governing arbitration in Panama do not prohibit such representation. They stipulate that the parties to arbitration may be represented by whoever they themselves choose, without distinction as to their profession as lawyers, or their nationality. Considerations and decision of the Fourth Chamber of the Supreme Court of Justice Regarding the first ground alleged for annulment, that is, that the arbitration procedure was not in accord - ance with the agreement between the parties, the court first resorted to the arbitration clause, from which it extracted that the parties submitted to the procedure of the institution administering the arbitra - tion (CeCAP), and that, from the beginning, they came to the understanding that the arbitration would be of an international nature and decided in law. It empha - sised that nothing was established about any limita - tion in the representation of the parties, which is why, in accordance with the arbitration centre’s own rules, they could freely appoint their representatives without limitation as to their profession or nationality. The only obligation the parties had was to communicate their choice to the arbitral tribunal. In the decision under discussion, the Panamanian court also referred to the fact that national procedural rules, including those that regulate the exercise of the legal profession in Panama, do not apply to arbitra -
tion proceedings. It is emphasised that the procedure must be one freely chosen by the parties in their previ - ous agreements. The Panamanian court judged that the arbitration pro - cedure was perfectly in accordance with the provi - sions of Law 131 governing arbitration in Panama and the CeCAP regulations freely chosen by the parties, thus rejecting the first ground for annulment. As for the second ground alleged by the appellant, which consisted of the violation of public order, based on the same facts that supported the first ground (ie, that the arbitral tribunal allowed the participation of foreign lawyers in the arbitration proceedings who were not suitable to practise law in Panama), the court considered that the breach of due process of law had not been proved, but rather the opposite. The free appointment of legal representatives guarantees the right of every person to act and defend themselves in a dispute. The Panamanian court noted that even self- representation would be possible and permissible. It should be noted that in examining the appellant’s motion for annulment, which was defeated in the arbitration process, the Panamanian court gave pre - ponderance to two legal principles closely linked to arbitration: the principle of party autonomy or con - tractual freedom and the principle of minimal judicial intervention in arbitration. Thus, the judgment under discussion declared the validity of the arbitral award of 7 September 2021, and its complementary award of 28 September 2021, both issued in law by CeCAP. Reasons why this ruling sets a trend The decision discussed in the previous paragraphs marks a trend in Panama for several reasons: It validates a broad interpretation of the representation of the parties in arbitrations held in Panama. The court ratified that the parties have a very broad capacity to appoint their representatives in arbitra - tion, even if they are not lawyers licensed to practise in Panama. This is based on Law 131 of 2013, which
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