What is the Impact of the Alleged Bribery?

This question relates to the impact on this Arbitration of the bribery of Mr Goldrich's assistant. It can be argued either way, i.e. either it is irrelevant to this Arbitration or it does taint the lease contact and as such may affect enforceability of claims under this contract.

The CLAIMANT will have to argue and show that the CLAIMANT cannot be held liable for any actions that have taken place without its knowledge or consent because the CLAIMANT had no control or supervision over the broker’s actions during the negotiations or after the conclusion of the Lease contract; and the CLAIMANT did not participate in any bribery. Here we have another excellent opportunity for teams to argue on the facts and the law.

Indeed, the broker was mandated by CLAIMANT to secure a substitute vessel for the purposes of holding the conference of Corporate Executives. He acted as an intermediary having no power to represent and bind the CLAIMANT. The fact that the broker did not obey the law in the exercise of his profession cannot take to the conclusion that the CLAIMANT committed bribery. Even if the tribunal were to find that the relation between CLAIMANT and broker was based on agency principles and thus the broker could bind the CLAIMANT by his actions, different case law have held that broker cannot bind the principal where the person with whom the agent contracts knows that the agent is engaged in self-dealing or acted against principle’s interests.

There is as such an argument as to whether the payment by the broker qualifies as bribery or not. Due to the significance of the offence, bribery has to be proven beyond doubt (Hilmarton v OTV) and the offenders positively identified. On the facts, CLAIMANT was not even aware of the payment made by the broker after the contract with Mr Goldrich was concluded. The broker and the personal assistant kept their illegal business hidden from CLAIMANT and Mr Goldrich in the mutual understanding that they were engaged in a self-dealing and not representing interests of their principals. CLAIMANT was not aware of the fact of the alleged bribery. In addition, Mr. Goldrich was not aware of his personal assistant’s actions and as soon as he realised that his personal assistant gained profit from them, he immediately reported those incidents to the local authorities. The assistant was subsequently convicted of receiving the bribe described in the statement of defence. (Clarification 26)

CLAIMANT considered this USD 50,000 payment only as a “success fee” and nothing more. The fact that the payment of USD 50,000 was made by the CLAIMANT to his broker after signing of the Leasing Contract, but not before, would be a strong argument to the effect that this money was a success fee for the broker, but not a bribe to be transferred to Mr. Goldrich’s personal assistant.

CLAIMANT would have in conclusion to show that RESPONDENT'S argument on bribery has no express legal basis under the law applicable to the contract. The broker's success fee and the other expenses “associated” with the Lease Contract are allowable items of damage. Then the burden of proof will shift to the RESPONDENT who will have the task of proving the bribery.

This is not intended as an exhaustive analysis of the problem, merely am indicative list of issues to be discussed in written submission by teams. One should appreciate reasoned and reasonable creativity and ideas beyond those in this limited analysis.

Date: 2015-12-11; view: 1173