USA Law and Practice Contributed by: Matthew H. Kirtland, Timothy Tyler, Katie Connolly and Taylor LeMay, Norton Rose Fulbright
when a non-resident party is involved but may be limited to urgent situations where arbitrators cannot act timely. When deciding to grant security for costs, courts strike a delicate balance between: • the degree of probability of success on the merits and the background purpose of the suit; • the reasonable extent of the security to be posed, viewed from the defendant’s perspective; and • the reasonable extent of the security to be posed, viewed from the non-domiciliary plaintiff’s perspec - tive. Parties are free to agree on the rules governing the procedure of arbitration as the FAA does not contain any mandatory rules governing arbitral proceedings. As described in 4.2 Default Procedures , the FAA pro - vides a procedure for appointment of a tribunal in cer - tain circumstances. 7.2 Procedural Steps There are no particular procedural steps required by the FAA for arbitral proceedings conducted in the United States. 7.3 Powers and Duties of Arbitrators The FAA provides limited powers to arbitrators. Sec - tion 7 of the FAA empowers arbitrators to issue sub - poenas for the attendance of witnesses and/or the production of documents at a hearing. Courts are split, however, on whether this power is limited to the context of an evidentiary hearing. Generally, arbitra - tors cannot compel attendance of a non-party at a pre-hearing deposition. 7. Procedure 7.1 Governing Rules As discussed above, the FAA is also silent on the duties of arbitrators, including as to the independence and impartiality of arbitrators, except that evidence of partiality or corruption can be grounds for vacating an award. 7.4 Legal Representatives The practice of law in the United States is regulated largely by individual states.
Legal counsel and arbitrators are subject to the ethi - cal codes and professional standards set by the state in which the arbitration is seated. US practitioners are also subject to the ethical codes and profes - sional standards of the jurisdiction in which they are licensed. All counsel and arbitrators should therefore familiarise themselves with the rules of the state in which the arbitration is seated. The jurisdictions where arbitrations are most typically seated in the US do not regard appearances by out- of-state or foreign lawyers in arbitrations as constitut - ing the “unauthorized practice of law” and therefore do not require that they be admitted locally. This is especially true for international arbitrations. Practition - ers will be subject to the rules of conduct of the state bar where the arbitration takes place. However, in certain states, counsel must be licensed to practise in that state, and, if not licensed, may only participate in arbitration if the proceedings arise out of the attorneys’ home state practice. In others, coun - sel must file a verified statement with the state bar association or practise in conjunction with a licensed attorney. 8. Evidence 8.1 Collection and Submission of Evidence The FAA does not provide any evidentiary rules. Arbi - trators are accorded great deference in their appli - cation of evidentiary rules. To the extent that parties agree, arbitrators may refer to the Federal Rules of Evidence or the IBA Rules on the Taking of Evidence in International Arbitration. In addition, many institutional rules include guidelines on evidentiary matters. Under the FAA, arbitrators have the power to summon witnesses to appear, testify and produce documents at an arbitration hearing. The US district court for the district in which the arbitration is seated is typically required to enforce such summons, but such enforce - ment is not guaranteed. In the event of non-compli - ance, the statute empowers the district court in the district in which the arbitrator sits to compel attend - ance before the arbitrator at a hearing. In addition, if a third-party witness is outside the range of a court
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