Arbitrators’ fees

In its decision no. 17956 of 11 September 2015, the Supreme Court appliedĀ for the first time Article 816/septies of the Italian Code of Civil Procedure concerning the arbitrators’ fees. In this decision, the Court examined the scope and conditions of application of the above mentioned provision. The Italian full text of theĀ decision is available here.

Pursuant to article 816/septies(1) of the Italian Code of Civil Procedure: ā€œThe arbitrators may make the continuation of the proceedings subject to the advance payment of the foreseeable expenses (…).ā€ The second paragraph of that Article also provides that “Should one party fail to pay the requested advance, the other may advance the totality of the expenses. Should the parties fail to provide for the advance within the time limit established by the arbitrators, they are no longer bound by the arbitration agreement with regard to the dispute out of which the arbitral proceedings originated.”Ā 

BecauseĀ of the parties’ failure to pay the requested advance (which also included the arbitrators’ fees), anĀ Arbitral Tribunal held that the parties were willing to terminateĀ the arbitration agreement and, consequently, the Arbitral Tribunal ruled that the arbitration could not proceed.

The Court of Appeal of Naples was requested to set aside the award and it did so. ItsĀ decisionĀ was later confirmed by the Supreme Court.

First, the Supreme Court found that article 816/septiesĀ of the Italian Code of Civil Procedure did not apply to this case as the arbitrators only requestedĀ the parties to pay an advance and the parties failed to do so. On the contrary, according to the Supreme Court ā€œthe arbitrators should clearly state that the continuation of the proceedings is subject to the advance payment.” Ā And this clear statement was missing in the case at hand.

The Supreme Court alsoĀ added that the reference to “foreseeable expenses”, contained in Article 816/septies of the ItalianĀ Code of Civil Procedure, cannot be broadly construed. This provision only covers the arbitrators’ expenses (and therefore it does not cover their fees). The scholars agree with this reading, although some Arbitral Tribunals use a broader construction of “foreseeable expenses”, including the arbitrators’ fees.

In this respect, it could be useful to analyse the Arbitration RulesĀ of the Chamber of Arbitration of Milan. The relevant provision is Article 38, which states: “where a party fails to lodge an advance as requested, the Secretariat may direct the other party to make a substitute payment, setting a time limit therefor, or may divide the value of the dispute, if it has not already done so, and direct each party to deposit an amount based on the value of its claim, setting a time limit therefor. Ā If any of the advances directed is not made within the time limit set therefor, the Secretariat may suspend the entire proceedings or only the proceedings related to the claim to which the lack of payment relates. The Secretariat shall lift the suspension when the payment is made. Ā Where the parties do not deposit the amount within one month of the notice of the order of suspension under paragraph 2, the Secretariat may declare the closing of the entire proceedings, or the proceedings related to the claim to which the lack of payment relates, without affecting the arbitral agreement.”Ā 

The provision of the RulesĀ of the Chamber of Arbitration of Milan has some broader scope of application than Article 816/septies of the Italian Code of Civil Procedure. This provision, in fact, concerns all the costs of the proceedings, including the fees of the Chamber of Arbitration, those of the Arbitral Tribunal and the possible experts. This broader scopeĀ is counterbalanced by the less serious consequences arising out ofĀ theĀ lack of payment. Indeed, the failure to pay does not determine the termination of the arbitration agreement (albeit only with respect to theĀ dispute out of which the arbitral proceedings originated), but the mere closing of the arbitration proceedings.

Leave a Reply

Your email address will not be published.


This site uses Akismet to reduce spam. Learn how your comment data is processed.

Browsing this website you accept the use of cookies. more info

The following information is provided in accordance with Article 13 of Regulation (EU) 679/2018 ("GDPR"), to users who access the services available at (ā€œSiteā€). When consulting the Site, information concerning users may be collected that constitutes personal data under the Privacy Code. This information is provided exclusively for the Site and does not affect any other web sites accessible by the user through links provided on the same.
Data Controller (Titolare del trattamento) is Arbitration in Italy Ltd, a company incorporated under English law, registered at No. 12459814, with registered office in 61 Bridge Street, Kington, HR5 3DJ, UK ("Company"). Data Processor (Responsabile del trattamento) is the Company's present legal representative.
The processing of data related to the web services on this Site is carried out at the premises of the Company set out above and is performed by internal personnel duly appointed as Persons in charge of processing (Incaricati del trattamento).
Surfing Data
During the normal operation, the computer systems and software procedures used to operate the Site acquire some personal data whose transmission is implicit in the communication protocols of the Internet. This information is not collected to be associated with identified persons, but by its very nature could, through processing and association with data held by third parties, allow identification of users. This category of data includes IP addresses or domain names of computers used by users who connect to the Site, URI (Uniform Resource Identifier) of requested resources, the time of the request, the method used to submit the request to the server, the size of the file obtained in reply, the numerical code indicating the status of the response from the server (successful, error, etc.) and other parameters regarding the operating system and computer environment. These data are used only to obtain statistical information about the site and its use and to check its correct functioning and are deleted immediately after processing. The data could be used to ascertain responsibility in the event of possible computer crimes committed against the Site: except in this case, the data on web contacts are kept for a maximum period of seven days.
Data provided voluntarily by the user
The sending of optional, explicit and voluntary e-mails to addresses shown on this Site, and the filling in of forms specifically provided involve the subsequent acquisition of the senderā€™s e-mail address and the additional personal data provided in the electronic communication, together with the sender/userā€™s data necessary to respond to requests as well as to provide the service. Specific summary information will be provided in relation to specific services.
Cookies are data files which some websites, while visited, can send to the user with the scope of tracing its path inside the site and collect data in anonymous form, in order to enhance the offer and the use of the site. The Company does not use information technology for the direct acquisition of personal data by which the user can be identified. Cookies for the transmission of personal information or systems for the tracing of users are not used. The Company uses so-called technical cookies only with the scope of rendering browsing the Site possible and to make it possible for the user to use its functions. Some technical cookies are necessary in order to optimize the use and have the user accredit itself with the Site, for example in order to enter a restricted area (so-called browser cookie). The browsing cookies are session cookies and are deactivated automatically once the browser is closed. For the installation of these cookies it is not necessary to collect the consent of the user. The Company uses furthermore analytic cookies of thirds parties by which information on the interaction of the visitor with the content of the Site is obtained (most frequently used pages, time of use, etc.) and which thereby provide statistic information which makes it possible to optimize the Site and to enhance its use.
Unless specified for surfing data, the user is free to provide personal information in the application forms or otherwise indicate them in order to request any information packs or other communications. Failure to provide personal information may, however, make it impossible to fulfill the request.
Personal data are processed by automated tools for the time necessary to achieve the purposes for which they were collected. Specific security measures have been taken to prevent loss of data, unlawful or incorrect use and unauthorized access.
The personal information provided by users who request dispatch of information packs or rendering of services is used only to provide the service requested and may be disclosed to Companyā€™s employees and consultants, duly appointed as Persons in charge of processing, as well as third parties that render ancillary or instrumental services to the activity of the Company and which are appointed as Data Controllers. There will not be any other communication of data to third parties, except upon request of public authorities. The data collected will not be disseminated.
Data subjects are entitled, pursuant to Article 12 of the GDPR, to obtain, at any time, confirmation of the existence of the data and to know their origin, verify their accuracy or request their integration, updating or correction. Pursuant to this article data subjects shall have the right to request cancellation, anonymization or blocking of data processed in violation of the law, and in any case, to object on legitimate grounds to their processing. Requests should be sent to the Data Processor, at the above address or by email to