The Austrian Supreme Court (Oberster Gerichtshof, OGH) in its decision rendered on 23 July 2020 (Case No. 18 ONc 3/20s) determined the admissibility of conducting an arbitration hearing by videoconference and rejected due process concerns.
PARTY ARGUES REMOTE HEARINGS VIOLATE THE PRINCIPLE OF FAIR TRIAL
In an arbitration with a seat in Vienna and administrated by the Rules of the Vienna International Arbitral Centre (VIAC), respondents filed a challenge with the VIAC Board against the members of the arbitral tribunal over their decision to conduct a remote hearing by videoconferencing.
Following the rejection of the challenge by the VIAC Board, the respondents initiated a challenge procedure before the Austrian Supreme Court pursuant to Section 589 (3) of the Austrian Code of Civil Procedure (ACCP).
The respondents argued that the tribunal's unfair conduct of the arbitration regarding the preparation and start time of the hearing (in different time zones) led to the unequal treatment of the parties. The respondents further claimed that holding a remote hearing, disregarding the measures against tampering with a witness, violates the principles of a fair trial.
More specifically, the respondents argued that both the tribunal and the parties in the arbitration were unable to ensure: which documents witnesses would use, that no other person is present in the room of a witness, and whether the witnesses receive messages during the examination.
DECISION OF THE SUPREME COURT
The Austrian Supreme Court rejected the respondents' challenge. In rendering its decision, the Supreme Court first assessed the legal standards for the challenge of an arbitrator under Austrian law.
The Supreme Court held that pursuant to Section 588 (2) of ACCP, an arbitrator may be successfully challenged only: i) in a case of the existence of justifiable doubts as to his/her impartiality and independence; and ii) if he/she does not fulfil the qualifications which were agreed between the parties. The Supreme Court noted that the reasons for the challenge of a state judge are used as guidelines, taking into consideration the specifics of arbitration.
The Supreme Court held that improper conduct of proceedings and procedural errors do not give rise to the appearance of arbitrator bias. Under Austrian law, the challenge of an arbitrator based on the alleged procedural violations can only be successful in cases of serious procedural violations or (permanent and substantial) preferential or disadvantageous treatment of the parties.
In the present case, the Supreme Court determined that holding a hearing by videoconferencing does not meet this high threshold.
VIDEOCONFERENCING AS A TOOL FOR PROVIDING EFFECTIVE ACCESS TO JUSTICE
Moreover, the Supreme Court emphasised that the use of videoconferencing is widespread and recognised in court proceedings, by referring to both the domestic and European procedural legal provisions. The Supreme Court noted that the use of videoconferencing in the context of the COVID - 19 pandemic is promoted by Austrian legislation as a tool in resuming judicial proceedings which have largely come to a standstill.
Finally, by relying on Article 6 of the European Convention on Human Rights (ECHR), the Supreme Court held that a hearing by videoconferencing is admissible even if one of the parties does not agree to its use.
The Supreme Court emphasised that Article 6 of ECHR provides not only the right to be heard, but also the party's right to effective access to justice.
NEW GUIDANCE FOR REMOTE HEARINGS IN ARBITRATION
The COVID–19 pandemic has significantly impacted the conduct of hearings in international arbitration by necessitating remote hearings via videoconferencing. The decision of the Austrian Supreme Court should be regarded as a landmark decision. It appears to be the first decision rendered by a national supreme court tackling the issue of hearings by videoconferencing in international arbitration, if one of the parties expressly objects to such a manner of conducting a hearing.
As such, this decision provides useful practical guidance for a conduct of a remote hearing in international arbitration by answering the questions of how the arbitrators should consider different time zones in organising remote hearings and what the tools and measures for preventing witness tampering are.
