ILLEGALLY OBTAINED EVIDENCE IN INTERNATIONAL ARBITRATION: EXAMINING THE ADMISSIBILITY
Updated: 7 days ago
This post is authored by Shubham Gandhi, a third year B.A. LL.B. (Hons.) student at Dharmashastra National Law University, Jabalpur.
Image Credits: Shutterstock
In the wake of a pandemic, there has been growing support for online dispute resolution, with proceedings and management of cases going virtual. While the settlement of disputes through virtual mode may have proven cost-effective and time-saving, but it has left the window open for hackers to tamper in million-dollar disputes, risking the confidentiality of parties and public entities.
In this regard, the tangled question of admissibility of illegally obtained evidence (“IOE”) arises when the evidence so leaked or procured is being produced before the tribunal to settle the dispute. For instance, in February 2021, the International Court of Arbitration shelved a multi-billion dollar award over the allegation that the claimant has gained access to the confidential information of 70,000 emails via cyber hacking, with two hackers later admitting to the same.
In this article, the author attempts to highlight the already present rules in international arbitration against IOE, the approach adopted by tribunals by shedding some light on cases on the legality of IOE in arbitration proceedings, and thereby provide a concrete way forward for admission of IOE in the international arbitration regime.
2. INTERNATIONAL ARBITRATION RULES ADDRESSING THE ISSUE
International arbitration rules provide wide discretion to the arbitration tribunal to determine the admissibility of evidence. The International Centre for Settlement of Investment Disputes Arbitration Rules by virtue of Article 34(1) state that “The Tribunal shall be the judge of the admissibility of any evidence adduced and of its probative value”, the same being contained in Rule 19.2 of SIAC Arbitration Rules.
Similarly, Article 19(2) of The United Nations Commission on International Trade Law (“UNCITRAL”) Model law dictates that “the power conferred upon the arbitral tribunal includes the power to determine the admissibility, relevance, materiality and weight of any evidence”.
In a recent turn of events, the International Bar Association (“IBA”), decided to make its rules in coherence with a digital surge in international arbitration and protect the commercial value of documents involved in the virtual proceedings, and brought a new amendment in the IBA Rules of Taking Evidence in International Arbitration 2020 (“2020 IBA Rules”).
The 2020 IBA Rules under newly embedded Article 9.3 stated that “Arbitral tribunal may, at the request of a party or on its motion, exclude evidence obtained illegally”. The power is solely vested with the tribunal for deciding the fate of illegal evidence. Article 9.2 of the IBA Rules use the word ‘shall’ while declaring grounds of privilege communication, legal impediment and politically sensitive information to be excluded from admission. Moreover, if the tribunal is of the opinion that evidence is obtained illegally by one of the parties, then Article 9.7 will come into the picture, thereby imposing cost and other ramifications made available in rules.
3. APPROACH TOWARDS ILLEGAL EVIDENCE
In one of the earliest judgments of Methanex v. USA, delivered in the year 2005, the NAFTA Chapter Eleven Arbitral held that evidence acquired illegally cannot be weighed in arbitration proceedings as both the parties owe a general duty of care and procedural fairness, to conduct themselves in ‘good faith’ during these arbitration proceedings and to respect the equality of arms between them, as required by Article 15(1) of the UNCITRAL Rules.
Furthermore, in the year 2009, by the case of EDF (Services) Ltd v Romania, the ICSID tribunal held that illegally obtained audio recordings of conversations would constitute a breach of privacy and is against good faith and fairness principles, thereby not admitting the evidence viz. otherwise relevant to the issue.
However, in the year 2012, in the case of Caratube International v Kazakhstan, the ICSID tribunal explicitly admitted 2000 hacked emails from a site called ‘KazakhLeaks’, following a cyberattack on the Kazakh government’s computer network, only due to the fact that the evidence was non-privileged. The tribunal laid down the following reasons for admitting evidence: (i) documents were relevant to dispute (ii) some documents were widely available in the public domain, so no element of privilege or confidentiality can act as a hurdle.
The extent of admissibility of IOE was liberated in the year 2019 in ConocoPhillips v. Venezuela. In this case, Venezuela sought to rely on evidence leaked by WikiLeaks after the award had been rendered. The majority present in the International Centre for Settlement of Investment Disputes (ICSID) tribunal refused to reopen the case as it had been rendered on merit and execution was pending. However, the ‘dissent’ by Prof. Georges Abi-Saab lays down the foundation of the admissibility of IOE. He opined that Venezuela produced glaring evidence, which is crucial to the proceedings, and the said document is already in public. Consequently, he opined that the dispute can be reopened on public policy grounds, as ignoring its existence and relevance would lead to a travesty of justice.
Therefore, over the mixed decisions rendered by various tribunals, the principles of procedural fairness, public interest, privileged communication, and good faith are considered as tenets to determine the admissibility of IOE, and recognized by tribunals in international arbitration.
4. TEST TO DETERMINE THE ADMISSIBILITY OF IOE
One of the renowned academicians in the field of international arbitration, Ms. Cherie Blair has given a two-step admissibility test of IOE, i.e.-
Clean hands Doctrine
Public Interest Doctrine
The doctrine of ‘clean hands’ is a common law principle which states that “no one should be profited from its own misconduct”. If the party to the dispute wrongfully acquires the IOE then they should be precluded from relying on such evidence, as they cannot seek benefit of their own misconduct, as highlighted in the case of Libananco v Turkey, delivered by ICSID.
Obtaining evidence which is otherwise present in the public domain can be used by the party to the proceedings. However, evidence obtained through breaches of international law constitutes a wrongdoing from which the responsible party should not be able to take advantage or receive rights, this inevitably breaches the doctrine of