Joinder and consolidation: one dispute, many parties

One dispute, many contracts and parties

A single commercial dispute often spans more than one contract and more than two parties: a project with a chain of subcontracts, a group of related agreements, a parent and a subsidiary. Run as separate arbitrations, the same facts can be argued twice and decided differently, at double the cost. Modern institutional rules answer this with two mechanisms the institution runs by rule, joinder and consolidation, so related matters are heard together.^1,2

Joinder brings an additional party in

Joinder adds a party to an existing arbitration. Under the DIAC Rules 2022 the Arbitration Court may, before any arbitrator is appointed, allow an additional party to be joined on a party’s application, where everyone has consented in writing or it is prima facie satisfied that the party to be joined may be a party to the arbitration agreement (article 9); once the tribunal is constituted, the tribunal decides joinder instead. The LCIA Rules let the tribunal join a third person on a party’s application where that person and the applying party have consented in writing (article 22.1(x)). Who may decide, and the consent required, are set by the rulebook.^1,2

Consolidation merges related arbitrations

Consolidation combines two or more arbitrations into one. Under the DIAC Rules the Arbitration Court, before constitution, or the tribunal, after it, may consolidate where all parties agree, or where the claims are under the same agreement to arbitrate or the parties are the same and the agreements compatible; the arbitrations then fold into the one that commenced first (article 8). The LCIA Rules put the power in article 22A: the LCIA Court may order consolidation, and the tribunal may order it with the LCIA Court’s approval, where the arbitrations are under the same or a compatible agreement and involve the same parties or arise from the same transaction (articles 22.7 and 22.8).^1,2

A single arbitration over several contracts

A related mechanism lets one arbitration cover several contracts from the start. The DIAC Rules allow a single Request for claims arising out of or in connection with more than one contract (article 8.1), so a claimant with a set of linked agreements does not have to file a separate case for each where the contracts and their arbitration agreements fit together. It is consolidation decided at the door rather than after two cases have started.¹

Joinder and consolidation are gates, not favours. The rulebook sets the test, the moment in the case it can be used, and who decides, so related matters are combined the same way every time.

Why combining cases is administration

Deciding whether to add a party or merge cases is a threshold the institution runs by rule: a defined test, a fixed point in the case, and a named decider, the institution’s court before the tribunal exists and the tribunal after. Running it the same way keeps related matters together without re-arguing the threshold each time, and the ICDR Procedures and the SIAC Rules carry equivalent provisions. It is the same pattern as administering a case on your own rulebook, applied to a dispute that does not fit neatly into one contract or two parties.^1,3