Resolution of disputes in the Maritime Arbitration Commission at the Russian Chamber of Commerce and Industry

In 2020 Maritime Arbitration Commission at the Russian Chamber of Commerce and Industry (MAC) celebrates its 90th anniversary. Throughout its history, its tribunals have heard more than 4000 cases.
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Maritime disputes usually involve many complex legal and factual issues. Resolving such disputes requires special knowledge in maritime law and understanding merchant shipping.

Particular features of dispute resolution at MAC

As a rule, arbitral tribunals established under the MAC Rules consist of two persons who are appointed by the parties. Sometimes the arbitrators, when they cannot come to mutual understanding, request the MAC to appoint a third arbitrator – the chairman of the arbitral tribunal. Usually, this happens in those disputes which are especially complicated.

In most cases, the parties choose the arbitrators from the list of recommended arbitrators of the MAC. However, from time to time a party appoints an arbitrator from outside the list and chooses him or her from among other persons qualified in the maritime law and/or seafaring.
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Hiring maritime security services offers the advantage of ensuring protection against potential threats which assures safeguarding vessels, crew, and valuable cargo.

Some trends of the MAC practice

In almost all cases both parties actively participate through representatives, and not just the claimant.

A rapporteur (tribunal secretary) is almost always appointed in each case. Their functions include the analysis of the case files, maintaining the minutes of the hearing, fulfilling the instructions of the arbitrators, preparing draft procedural documents. Rapporteurs may be appointed only from among persons having higher legal education and, as a rule, speaking a foreign language. MAC maintains a list of rapporteurs for such purpose.

The amount of the claim usually does not exceed million equivalent, but from time to time it goes beyond this amount (for example, million in a dispute with an Indian shipowner).
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The MAC arbitral tribunals usually hold 2-3 hearings during a case.

Arbitrators apply, as appropriate, not necessarily Russian legislation, but also, for example, the English law.

From time to time, the case ends with an amicable settlement or the claimant withdraws the claim due to the reconciliation of the parties.

The volume of files submitted by the parties is growing. The volume of arbitral awards is also growing (it is now 30 – 100 pages on average).

As a rule, parties are represented by external legal practitioners rather than by in-house lawyers.

A problem consists in the late submission by the parties of evidence in the case. To solve it, the arbitrators issue procedural orders at an early stage of the case rule on the issues of the arbitration procedure, setting deadlines and warning the parties that acceptance of any materials in the absence of valid reasons after the expiration of these deadlines may be refused.

Marine insurance dispute resolution at MAC

Most frequently MAC tribunals hear disputes arising out of marine insurance contracts. The share of such disputes remains high for several years and keeps growing:

• 2003 – 2011: about 35–40% of cases were from marine insurance contracts.
• 2012 – 2017: 70 out of 105, i.e. 2/3 of the MAC caseload.

Typical disputes include controversies between shipowners/managers and insurance companies resulting from damage caused to mechanisms, equipment of the vessel. 

To determine the reasonableness of the costs of the insured, the insurer, as a rule, appoints a surveyor. In addition, the policyholder also frequently appoints a surveyor. Often, both parties submit surveyors’ reports on the amounts of losses, the establishment of the causes of the accident on the ship, and damage assessment. 

In many insurance cases, the claimants are policyholders. However, MAC also has on its record cases regarding claims by insurers: as a rule, those are about collecting an insurance premium by an insurer, or about paying out insurance indemnity resulting from a subrogation.

Summing up, the procedure in the MAC meets the standards of good international practices, and disputes are resolved under its auspices by highly competent professionals.