Consolidation Under the English Arbitration Act 1996:

A View from the Netherlands

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Section 35 of the Arbitration Act 1996 provides that the parties may agree that
the arbitral proceedings shall be consolidated with other arbitration pro-
ceedings, or that concurrent hearings shall be held. In the absence of an explicit
agreement, the tribunal shall not have the power to consolidate or hold
concurrent hearings.
In this note, an attempt will be made to comment on this provision from an
international perspective, in particular from a Dutch angle. The reason for this is
that there is relevant experience in the Netherlands. Since 1986, the Netherlands
Arbitration Act has provided that parties to arbitral proceedings pending in the
Netherlands may request the President of the District Court in Amsterdam to
consolidate these proceedings (in full or partially) with other arbitral proceedings
commenced before another arbitral tribunal in the Netherlands. Parties may by
agreement exclude this possibility. The President is also given the power to
appoint the arbitrator(s) and determine the applicable procedural rules, if the
parties are unable to agree on these issues.
The need for consolidation is often said to be most acute in the fields of
maritime and construction arbitration. For the Netherlands, the problem is most
keenly felt in the construction industry, where submitting disputes to arbitration
is standard practice. In addition to the Netherlands Arbitration Institute which
deals with all types of arbitration, a number of specialized arbitration insti-
tutes exist which exclusively administer construction arbitrations. Separate
institutes have been created to deal with the various relationships encountered in
a typical construction project, such as the relationship with the architect, the
technical adviser, etc.
It is largely as a result of lobbying by the construction industry that the
consolidation provision was enacted in the Arbitration Act 1986. The cases
which have been brought before the President of the District Court of
Amsterdam so far have indeed almost always been construction cases. On
average, approximately three requests are submitted to the President per year,

Dutch Code of Civil Procedure (hereafter referred to as 'CCP'), s. 1046.

This note will not address the possibility of ordering concurrent hearings.
3
The main institutes are the following associations: Koninklijk Instituut van Ingenieurs (Royal Institute of
Engineers); Koninklijke Maatschap tot Bevordering der Bouwkunst; Bond van Architecten (Royal Society
for the Promotion of Architecture, Confederation of Dutch Architects); and the Vereniging Algemeen
Verbond Bouwbedrijf (Association of the General Confederation for the Construction Industry). These
associations together have established the Raad van Arbitrage voor de Bouwbedrijven in Nederland
(Council for Arbitration for the Construction Industry in the Netherlands) to create a Court of Arbitration
for the Construction Industry in the Netherlands.

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© LCIA, 1997

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428 Arbitration International Volume 13 Number 4

and almost without fail, the President orders consolidation in those cases. In
practice, therefore, parties have given up objecting to these requests and merely
try to co-operate in appointing mutually acceptable arbitrators and working out

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which rules should apply. In fact, parties even forgo the opportunity to attend
the hearings scheduled to discuss a consolidation request and therefore the
President often issues decisions by default.
In one (unreported) decision, the President refused to consolidate arbitration
proceedings, even though the facts of the case (again, a construction case)
seemed to warrant consolidation. In that case the President considered that
since the arbitrations were pending before the same institute (the Netherlands
Arbitration Institute) it was the task of that institute to work out any request for
consolidation. However, the Netherlands Arbitration Institute Rules do not
contain a provision on consolidation.
Consequendy, even though the consolidation provision was enacted to
accommodate the construction industry, the users were not entirely satisfied with
the result. Therefore, the various construction arbitration institutes have decided
joindy to create a new system of consolidation to replace the statutory system.
It would fall outside the scope of this contribution to describe in great detail
how the system will work. Generally, the new rules of the Court of Arbitration pro-
vide that a party to an arbitration pending before the Court of Arbitration which
is related to an arbitration pending before another arbitration institute which has
a comparable rule, may request consolidation. Such a request will be dealt with
joindy by the respective chairpersons of the institutes involved. The statutory
procedure contained in section 1046 of the CCP is excluded explicidy. Only if
the chairpersons are unable to come to a decision may the parties address the
President of the District Court. The chairpersons will also determine which rules
will be applied and how arbitrators will be appointed.
It is important to realize that one important issue usually does not play a role
in these consolidated construction cases in the Netherlands. Contrary to
international practice, the system of party-appointed arbitrators is not prevalent
in Dutch (construction) arbitration. Therefore, it is relatively easy to appoint
arbitrators in consolidated arbitrations and Dutco problems are not likely to
arise.

Not all of these cases have been reported. Last year, a meeting was held of the Dutch branch of the Arbi-
tration working group of the International Law Association. On that occasion, the President of the District
Court commented on the practice of consolidation in accordance with s. 1046 CCP. Also present were
representatives of the Netherlands Arbitration Institute as well as the various construction arbitration
institutes. The text of this note is partially based on the remarks made on that occasion by the President and
the institutes' representatives and the discussion which followed.
The Netherlands Arbitration Institute may try to facilitate matters by appointing identical arbitrators and by
co-ordinating hearings in the separate cases.
This new system is laid down in the revised Articles of Association of the Court of Arbitration for the
Construction Industry, which will enter into force on 1 September 1997 (Arts. 23-27).
As readers will recall, in 1992, the Supreme Court of France ruled in Siemens v. BKMI and Dutco (XVIII
Yearbook) that as a rule of international public policy all parties to an arbitral agreement should be given
equal rights as far as the constitution of the arbitration tribunal is concerned. The court held that a party
 Notes 429

T o conclude, the court-ordered consolidation provision in the Netherlands

may become redundant so far as the construction industry is concerned -
although it will retain some importance in situations where the chairpersons of

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the relevant arbitration institutes are unable to agree. Furthermore, the statutory
system will remain necessary for arbitrations pending before institutes with rules
which do not contain an alternative to the power of the President - notably the
Netherlands Arbitration Institute.
At the same time, it is important to remember that the Dutch system provides
for court-ordered consolidation unless it has been excluded. In this light, it is
also remarkable mat the President himself stressed the fact that he had only
limited insight into the disputes mat were brought to his attention, and warned
that his role should not be overestimated. Experienced parties therefore will
consider carefully whether consolidation should be excluded. The careless first-
time user of arbitration, however, may be unpleasandy surprised by the Dutch
system.
Hopefully, die development of consolidation in the construction industry in
the Netherlands can serve as an example and at the same time as a warning to
other countries contemplating compulsory consolidation in their legislation. The
Arbitration Act 1996 seems to contain a workable compromise. It does not
burden a single judge with the difficult task of deciding consolidation requests
regardless of the nature of the dispute, but it does create room for die parties to
make the necessary arrangements. Possibly, the Dutch example may stimulate
arbitration institutes to work out practical solutions, perhaps along the lines
described in this note. Inevitably, tiiis will involve making difficult choices, in
particular in respect of the appointment of arbitrators and applicable rules.
However, based on the Dutch experience, it seems preferable that such choices
should be made by the industry itself, rather than leaving those decisions to the
legislator or the courts.

Jacomijn J. van Haersolte-van Hof

cont.
who has been deprived of such right could claim annulment of an award rendered in that arbitration. See
J. L. Devolve, 'Multipartism: The Dutco Decision of the French Cour de Cassation' (1993) 9 Arbitration
International 2 at pp. 197-202.
In this context it is surprising that the revised Netherlands Arbitration Institute Rules which are expected to
enter into force on 1 January 1998, do not contain a provision similar to that of the Arbitration Court for
the Construction Industry.
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