Introduction1

According to the American Heritage Dictionary, the "nature" of something is its "essential characteristics and qualities". In this light, it is entirely understandable that a colloquium devoted to "Conservatory and Provisional Measures in International Arbitration" would commence with an analysis of the "nature" of these measures.

However, one quickly discovers the insightfulness of a leading expert in the field who observed, in the course of a consultation provided in the context of an international arbitration, that

the notion of "conservatory measure" is one of the most obscure that there can be. Etymologically, it is understood as a measure which tends to safeguard a right. But when one seeks to go more thoroughly into this concept, the certainties slip away because, in reality, the "conservatory measure" covers very disparate hypotheses.

Another commentator in the field reached much the same conclusion after a study of the French law and jurisprudence in the area. He stated (author's translation):

In studying these [conservatory] measures one after the other, one has always the impression of disparate elements which fall into place only for the needs of a particular case. All in all, they largely escape doctrinal analysis."2

In seeking the "nature" of these measures, may we then turn to the approach of Justice Stewart of the United States Supreme Court who once wrote, in a well-known decision, that while he could not define hard-core pornography, "I know it when I see it"3

The response must be negative, because the subject matter is too important to be left exclusively to the hormonal reactions of lawyers and judges.

What exactly is the importance of the subject matter?

One of the major advantages of arbitration over litigation is the relative rapidity by which an arbitral tribunal usually reaches a final decision.4 And yet, however efficient an [Page9:] arbitral tribunal (and however cooperative the parties insofar as the conduct of the arbitral proceedings is concerned), circumstances may still require that an arbitral tribunal, or a State court, order one or more conservatory or provisional measures in order to protect the interests of one or both of the parties pending a final award.

Thus, an effort to determine the "nature" of conservatory and provisional measures in the context of international arbitration must not be a mere academic exercise aimed at discovering some platonic ideal of conservatory and provisional measures which, if identified, would then be put behind glass and admired from a distance. Rather, the objective must be to try to identify, from judicial and arbitral decisions and other sources, the "essential characteristics and qualities" of these measures so as to facilitate the task of arbitral tribunals and State courts when they are called upon to decide whether or not (and when) to order an interim measure in the context of international arbitration.

The identification of such characteristics and qualities can also be of assistance to the parties in an international arbitration in deciding whether or not to request a particular interim measure, when to request it, and from whom. As shall be discussed below, errors by a party in shaping a request for provisional measures may result not only in failure to obtain the measures requested, but perhaps also the involuntary waiver of the arbitration clause itself.

It is generally recognized that interim measures (1) are temporary in nature and cannot exceed the legal protection requested by the parties, and (2) are restricted by the scope of the underlying dispute.5

However, for a fuller understanding of the nature of conservatory and provisional measures, we need to go further than these self-evident characteristics. This paper will therefore concentrate on the following four lines of inquiry to determine whether other characteristics of these measures may be discerned:

(a) the inter-relationship between these measures and the forum or situs State;

(b) the extent to which such measures need or need not be legally binding;

(c) the inter-relationship of such measures with the merits of the underlying case; and

(d) the circumstances in which such measures are sought (only in time urgent situations?).

But before addressing these matters, the function of "provisional and conservatory measures" will be briefly set out and a few classic examples of these measures will be described.

I. The function of "conservatory and provisional measures"

Parties involved in litigation before a national court almost always have the possibility of obtaining, in the circumstances appropriate to each jurisdiction, conservatory and provisional measures, i.e., measures intended to serve one or more of three basic objectives: (a) ensuring that the very purpose of the litigation is not frustrated while awaiting the pronouncement and enforcement of a final decision on the merits; (b) regulating the conduct of and the relations between the parties during the proceedings; and (c) conserving evidence and regulating its administration.6

Regarding the first of these objectives, as Advocate General Tesauro noticed in his opinion on a recent case brought before the European Court of Justice, one of the purposes of interim measures "is to achieve that fundamental objective of every legal system, the effectiveness of judicial protection".7 In this sense, in a dispute brought before either a national court or an arbitral tribunal, a provisional or conservatory measure may be needed, for example, to prevent a party from concealing or transferring beyond the reach of the relevant jurisdiction the property which is the subject-matter of the dispute or the assets from which the successful party may find satisfaction. [Page10:]

Secondly, there may be a need, in the course of the arbitral proceedings, for the parties to do or abstain from doing certain acts. An example would be an order or recommendation that a party suspend the calling under a bank guarantee, so that the status quo between the parties may be preserved until a final decision on the merits of the dispute.

Thirdly, a provisional or conservatory measure may be needed, for example, to preserve a piece of evidence that may otherwise become unavailable, either through an act of will of one of the parties or simply due to a routine course of events (e.g. completion of a construction project), or to acquire further evidence through the hearing of a witnesses or an expert.

The objectives sought by parties when seeking conservatory and provisional measures in the context of international arbitration would not appear to differ in any significant way from the objectives sought by parties when seeking these measures in the context of litigation before State courts. Indeed, there is every interest in ensuring that parties which have chosen to resolve their disputes through arbitration rather than litigation not forfeit any more than is absolutely necessary the rights they would have had in litigation w avail themselves of conservatory and provisional measures. While it is inevitable that litigation and arbitration each has certain advantages and disadvantages vis-à-vis the other, should parties consider that the quality of justice rendered or the obtaining of satisfaction on an arbitral award is substantially diminished by the selection of arbitration over litigation, it would obviously bode ill for the future of arbitration.

II. Some typical conservatory and provisional measures

Before listing a few typical measures of interim relief, it may be noticed that, while the expression "conservatory and provisional measures" is of general use, the distinction between "conservatory" measures and "provisional" measures is not always clear.8

In the context of arbitration (and of international arbitration), the distinction between conservatory and provisional measures may be important in certain respects. For example, under Article 818 of the Italian code of civil procedure, an arbitral tribunal cannot order "conservatory" measures.9 But this article would not preclude an arbitral tribunal from ordering an interlocutory payment or any other "provisional" measure.10

Be this as it may, for present purposes there is no need to dwell at length on this distinction, and the terms "interim", "provisional" and "conservatory" will, in general, be used interchangeably throughout this paper.

We may now briefly consider a few typical interim measures, many of which may be ordered by both State courts and arbitral tribunals, others of which may usually be ordered only by State courts. Given the multiple functions served by interim measures, as seen earlier, it is apparent that there exists a wide variety of provisional and conservatory measures, and it goes without saying that no attempt will be made here to provide an exhaustive list.

A number of examples are listed in the rules of various arbitral institutions. For instance, Article 13(1) of the Rules of the London Court of International Arbitration provides that, unless the parties agree otherwise and subject to the mandatory limitations under the applicable law, [Page11:] the arbitrators may order the parties to make certain things available for inspection, order the disposal of property under the control of either party and order the production of documents.

Likewise, Article 22 of the AAA International Arbitration Rules provides that interim measures include deposit of property with a third person or the sale of perishable goods. Article 38 of the Netherlands Arbitration Institute Rules establishes the power of an arbitral tribunal to order either party to provide security for costs related to an arbitration.

A typical measure for the purpose of preserving the utility of the award is the pre-award attachment. This is granted with a view to preserving the debtor's assets or keeping them in the jurisdiction where the enforcement of the arbitral award will be sought. In fact, there is always a risk that, while the arbitration proceedings are pending, the debtor may try to dispose of its assets, or remove them from the court's jurisdiction, with a view to (or in any event with the result of) frustrating the enforcement of the award by the successful creditor in the arbitration.11

By a sequestration, the claimant may request an order whereby the goods or chattels in dispute, while remaining in the defendant's possession, are noted in the records of the case and must be conserved by the defendant.

A preliminary injunction aims at protecting the rights of a party from the prejudice that may occur while the resolution of a dispute is pending. In particular, unlike attachment that would preserve the assets in a money damage claim, the preliminary injunction seeks to protect the rights in a dispute over non-money damages12 The circumstances under which an injunction may be ordered are extremely varied. It has been remarked that an injunction may have as a rule two functions: (a) protecting the property in dispute from abuse by one of the parties, or (b) providing a sort of interim specific performance of the contract (as when, for example, in a dispute relating to the termination of a charter party, the court prohibits any use of the vessel not in accordance with the charter).13

An order for security for the amount in dispute may be granted when the right to a specific amount is in dispute. In this case, a court or arbitral tribunal may order that the amount be paid into court or secured by other means.

When a court or an arbitral tribunal considers that a property in dispute should not be in either party's possession until the dispute is settled, it may appoint a receiver for the property in question and the fruits thereof.

When the subject of the reference for an interim measure are perishable goods, the detention, custody, preservation or sale of such goods may be ordered.

Among the measures for the protection of property for evidentiary purposes, there is the appointment of an independent expert. To the extent that the expert records the facts and does not give any opinion (like the "constatant" under French law),14 then this measure would undoubtedly be regarded as a conservatory one. When, on the other hand, the mission of the expert goes beyond the one just described, doubts may arise as to whether we are really in the presence of a measure which is merely conservatory.

Finally, an order for security for costs may be granted when the defendant requests that the claimant provide enough security to pay the defendant's costs should the action prove unsuccessful. This measure relates mainly to cases in which the plaintiff is resident abroad, and therefore the defendant may be unable to [Page12:] enforce the order that the claimant pay the defendant's costs for the arbitration.15

III. The links between conservatory and provisional measures and the forum or situs state

May an essential characteristic or quality of these measures be ascertained by considering the relationship between the granting of interim measures and the existence of any particular links with the forum or situs State? Two recent English decisions provide a useful introduction to the subject.

The first is the decision delivered by the Court of Appeal (Civil Division) on January 22, 1992, in the case Channel Tunnel Group Ltd. and Another v. Balfour Beatty Construction Ltd. and Others.16

This case related to a contract entered into by an employer (Eurotunnel) and a consortium of English and French contractors (Trans Manche Link) for the construction of a tunnel under the English Channel between England and France. The contract provided that disputes or differences between the parties would be referred in the first place to a panel of three experts and, failing resolution, would be finally settled by ICC arbitration in Brussels.

A dispute arose between the parties as to the correct price for the construction of a cooling system, which was not contemplated in the original contract but had been then added by a variation order. On October 3, 1991, the contractors threatened that they would suspend all work relating to the cooling system unless certain conditions were met. In response to this, on October 14 the employer sought an injunction from the Commercial Court in London to restrain the contractors from suspending work, as they had threatened. Two days later, on October 16, the contractors applied for a stay of the employer 's action, pending a decision by the panel of experts.

On December 4, Judge Evans dismissed the contractors' application for a stay, and added that there would be no order as requested by the employer because the contractors had undertaken that they would not suspend work without giving the employer 14 days notice.

The contractors appealed because Judge Evans, white making no order against them, was ready nevertheless to grant an injunction requiring the contractors to continue work on the cooling system and refrained from doing so only because of the contractors' undertaking.

One of the issues before the Court of Appeal was that of its jurisdiction to order an injunction to restrain the contractors from suspending work. The crucial point on this issue was expressed by Lord Justice Staughton in the following terms:

Does an English court have power to grant an injunction where the arbitration is to take place abroad, and if there is such a power, should it be exercised?

The Court of Appeal gave a negative answer to the first question, which mooted the second. As for the power to grant an injunction, the Court noted that, if a dispute is between two English companies and the seat of arbitration is in England, a court can certainly grant an injunction. But the present case was different, in that (a) some of the parties were French, and (b) the agreed situs of the arbitration was Brussels.

Lord Justice Staughton first considered the issue of jurisdiction under section 12(6)(h) of the English Arbitration Act 1950. After extensive discussion, he concluded that

the connecting factor for the application of section 12(6)(h) of the Arbitration Act 1950 to a case containing a foreign element is the place which the parties have chosen as the seat of the arbitration. If that is in England or Wales, our courts have jurisdiction; if not, they have none. It follows that the English court has no jurisdiction under section 12(6)(h) in the present case, since the seat of any arbitration is Brussels.

On similar grounds, Lord Justice Staughton concluded that an interim injunction should not be granted under section 37 of the Supreme Court Act 1981.

The second decision for consideration is that which Justice Hirst of the Queen's Bench [Page13:] Division (Commercial Court) of the High Court delivered on September 3, 1992 in the case Voest-Alpine Aktiengesellschaft v. Ken-Ren Chemicals and Fertilizers Limited (In Liquidation) .17

In that case, the respondent in an ICC arbitration applied to the court for security for costs. The plaintiff was an Austrian contractor, while the defendant (the claimant in the ICC arbitration) was a Kenyan company.

The dispute arose out of a supply contract which provided for any disputes to be settled under the ICC Rules. The applicable law would be Austrian law, and the seat of the arbitration would be London. In the arbitration clause, the parties expressly reserved their right to resort to court for interim protection.

In his judgment, Justice Hirst referred extensively to Bank Mellat v. Helliniki Techniki S.A.,18 a decision in which the Court of Appeal had spelled out the principles applicable to a request for security for costs in an international arbitration. In his conclusions in the Bank Mellat decision, Kerr L.J. had written that:

English courts should be slow in applying the jurisdiction to order security for costs in international arbitration unless, in the particular circumstances of each case, there is more specific connection with this country... than the mere fact that the parties have agreed that any arbitration is to take place in England.19

Among the relevant factors to take into account in deciding whether a court order for security for costs would be appropriate, Kerr L.J. had listed the applicable law, the link between the country of the forum and the parties and subject-matter of the agreement in question, as well as the applicable arbitration rules.

Justice Hirst remarked that the case before him was closely analogous with the Bank Mellat case. He noticed that the parties had no connection with England, the applicable law was Austrian law, and the supply contract related to goods manufactured in Austria for a Kenyan customer. In other words, the only connection with England was that, according to the agreement of the parties, the seat of the arbitration would be London. From these considerations, Justice Hirst drew the conclusion,

that it would be inappropriate in principle for the Court to exercise its statutory discretion in favor of an order for security for costs unless... [there were]... other special factors of sufficient magnitude to outweigh that very important principle.20

The common element between the two cases is the refusal of an English court w grant an interim measure unless there is a close link between the measure in question and the forum State. In the second case the arbitral situs was England but this was not considered, by itself, to constitute a sufficient link for the exercise of the Court's "statutory discretion". Why is it so? The reasons may be various, but one in particular is worth mentioning here, especially because it is explicitly stated in Lord Justice Staughton's decision in the Channel Tunnel case, when he remarked that:

the Channel Tunnel contract involves a delicate balance of power between the municipal law of two sovereign States. We should be careful not to exercise jurisdiction except where to do so is within the spirit as well as the letter of our laws.

In other words, the exercise of the power to grant an interim measure, when there are foreign elements, overlaps with the issue of State Sovereignty. A court, as an organ of a State, is likely to be especially sensitive to this issue.

That this is so is also confirmed by the decisions of national courts of other States21. For example, a judgment rendered by the [Page14:] Yokohama District Court on September 29, 196622 concerned a case where two vessels had collided off the Japanese coast. The plaintiff's representative applied to the Yokohama District Court for provisional attachment on the defendant's sister vessel, located in Japan. The Court held that it had jurisdiction and granted the attachment order requested. The majority of Japanese commentators apparently agree that it was the location in Japan of the vessel to be attached that conferred jurisdiction on the court.

In another case, a U.S. company commenced an action in a U.S. Court to compel arbitration against a Japanese company with which it had contracted, the contract containing an arbitration clause. The U.S. company also applied for preliminary injunctive relief against the Japanese company. The U.S. appellate court considered that it had jurisdiction to entertain the application for the injunctive relief but upheld the lower court's decision which dismissed the application on forum non conveniens grounds and considerations related to the enforceability of relief and the primacy of Japan's interest in the litigation. (The Court also required that the Japanese company make an adequate showing that the U.S. company had an alternative remedy in the Japanese courts.)

While the courts of different States may accord differing degrees of importance to the various possible "connecting factors", that some connection with the forum State is generally considered desirable or even necessary finds support in other examples.

Are arbitral tribunals as hesitant as courts when requested to grant interim measures in the absence of a strong connecting factor with the situs State of the arbitration?

Arbitral tribunals do not appear to be as concerned with such constraints,23 and there is good reason for this. Neutrality is the essence of international arbitration and one consequence of neutrality is that the situs of an arbitration, whether chosen by the parties themselves or an arbitral institution, is often a "third" country having no links whatsoever with the parties or the subject of the arbitration.

Should a consequence of this manifestation of neutrality be the abdication of the right of an arbitral tribunal to issue provisional orders, a serious dilemma would exist for parties opting for arbitration. They would be faced with the choice of either abandoning the notion of a neutral situs or else selecting such a situs but thereby stripping away much of the authority of the arbitral tribunal to issue interim orders.

That such a situation has not arisen is probably due in part to another inherent characteristic of arbitration, namely that an arbitral tribunal is not an emanation of the State.24 (The New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards would certainly not have been adhered to by some 89 States parties had it dealt with the recognition and enforcement of the decisions of State courts.) While this leads to the result that an arbitral tribunal generally lacks the imperium (the consequences of which will be examined below), it is precisely this absence of imperium which permits an arbitral tribunal to be largely free of concern about whether an order for interim measures which it issues is directed at parties and objects situated outside of the situs State.

In sum, it can be said that the "connective tissue" between a conservatory or interim measure and the situs or forum State is not a fixed characteristic independent of all relevant factors. Rather, a party considering to make a request for an interim measure must bear in mind whether the request is addressed to a State court or an arbitral tribunal and, if it is the former, whether sufficient connective elements are present to overcome the reticence that a [Page15:] State court might otherwise have to issue any such orders.25

IV. The extent to which conservatory and provisional measures are or are not legally binding

One of the considerations developed in the previous section is that State courts are reluctant to grant interim measures if there are not sufficient links between the case at hand and the forum State. It was added that part of the reason is that the assertion of jurisdiction overlaps with the issue of State sovereignty.

There are also aspects of State sovereignty at play in this particular context. A domestic court may be hesitant to grant an interim measure if by doing so it would run the risk of displeasing or antagonizing another sovereign by attempting to project the authority of one State into the territory of another.

So too, a domestic court may be reluctant to order an interim measure when there is a foreign element because one consequence of this is that it makes it more likely that the court's order will be ineffective and State courts do rot generally like to issue decisions which cannot be enforced.26

Therefore, the question of jurisdiction is interrelated with the question of the legally binding force of interim measures. In fact, they may be regarded as the two Bides of the same coin.

In the Channel Tunnel case discussed above, there surfaced the issue of the legally binding force of interim measures. Lord Justice Staughton examined the effect on jurisdiction of the parties' choice of a foreign situs accompanied by a choice of English procedural law. In this respect, Lord Justice Staughton quoted approvingly the following passage from Mustill & Boyd's work on commercial arbitration:

In this situation, the English court would be highly unlikely to assume jurisdiction to intervene in the reference or to set aside or remit the award.

Any attempt to exercise powers to appoint arbitrators or to give ancillary relief, such as orders for the inspection of property, would in fact present formidable difficulties of enforcement. Moreover the prospect of two courts exercising supervisory powers over the same reference at the same time would appear to be unacceptable.'27

Therefore, Lord Justice Staughton concluded that, under the English Arbitration Act, English courts have jurisdiction if the parties have agreed on arbitration in England or Wales, otherwise they do not.

Would the same considerations apply to interim measures ordered by arbitral tribunals? A partial award rendered by an ICC arbitral tribunal in a case between a French contractor. and an Iranian governmental organization is a useful point from which to begin consideration of this question.28

In this case, while the arbitral proceedings were under way, the Iranian party instructed a bank to make a call under a performance guarantee. The French party applied to the arbitral tribunal for a declaration that (a) the bank guarantee was null and unenforceable, (b) the call was fraudulent and unjustified, and (c) any call should be suspended until a decision on the merits has been made.

The arbitral tribunal did rot grant the declaration requested, but wrote in its partial award that:

the parties should in the same spirit of goodwill that they have already demonstrated in signing the Terms of Reference, refrain from any action likely to widen or aggravate the dispute, or to complicate the task of the Tribunal or even to make more difficult, one way or another, the observance of the final arbitral award.

In other words, the arbitral tribunal came to a conclusion which, while aiming at preserving the "status quo" between the parties, was devoid of any legally binding force. (Although contained in an award, it would appear that the interim measures discussed above were not phrased in a mandatory manner.) However, this did not deter the arbitral tribunal from rendering the decision that it did. [Page16:]

It can be argued that just as arbitral tribunals need not be as concerned as domestic courts about issues of State sovereignty, the fact that interim measures ordered by arbitral tribunals may Jack legally binding force does not seem to deter arbitral tribunals from granting such measures,29 although arbitrators are naturally reluctant to order measures which would be meaningless or contrary to the laws of the jurisdiction in which the measures would be carried out.

Of course, while arbitral tribunals cannot generally enforce their orders through direct legal sanctions, parties in practice are likely to comply voluntarily with such orders. The reason for this is not simply that parties have themselves chosen arbitration and are logically expected to comply with whatever decision an arbitral tribunal will make. Far more important is the realization by the parties that the arbitrators are able to draw adverse inferences from a party's failure to obey orders for certain interim measures, such as those for the preservation or production of evidence30 It is also a reality which cannot be ignored that parties are often concerned that arbitrators will, at least subconsciously, have in mind the conduct of the parties when deciding on the issues. That the grounds for setting aside or refusing the enforcement of an arbitral award are generally quite limited can only reinforce for the parties the importance of not unnecessarily antagonizing the arbitrators. Accordingly, parties are generally reluctant to ignore even a non-binding interim order.

To sum up, legally binding force does not seem to be an inherent characteristic of interim measures. But, once again, distinctions appear between national courts and arbitral tribunals in regard to the issue. In practice, domestic courts will be hesitant to order measures the effectiveness of which they cannot assure and, when there are no close links between the case and the forum State, there is an increased likelihood that an interim measure, if ordered, will be ineffective. In such a case, and absent urgency, a party may well be better advised to request the measure in question from an arbitral tribunal which may be less reluctant to order an interim measure that, while perhaps lacking legal force, would nonetheless be effective for the reasons stated above.

V. The inter-relationship of conservatory and provisional measures with the merits of the underlying case

That a provisional measure is not permanent would appear to be self-evident. However, misunderstandings about this point are not unknown and, as was said earlier, such a misunderstanding by a party may have the grave consequence of leading a State court or an arbitral tribunal to conclude that a party has waived its right to arbitration. A recent case concerning a request for an injunction illustrates this point.

The case in question led to a pronouncement by an ICC arbitral tribunal (adopted by a majority of the arbitrators) last year. There is now before the French courts a request to set aside the award. The case is a complex one and my law firm is involved. Therefore, only a brief description of the matter is appropriate for the present purposes.

The claimant (a contractor in a turnkey contract) had filed a suit before a Pakistani court against certain of the defendants (which were subcontractors involved in the contract). The suit was headed "Suit for permanent injunction". One of the questions before the arbitral tribunal was whether the claimant, in commencing and prosecuting a suit for a permanent injunction, had implicitly waived its right to arbitration.

The arbitral tribunal stated in its award on jurisdiction that the commencement of an action claiming a permanent injunction, absent a sufficient countervailing factor, is "almost irresistible objective evidence of an intention to repudiate or waive the arbitration agreement.""" On the other hand, according to the award, a request for a temporary (as opposed to a permanent) injunction would not have constituted such evidence.

After a detailed examination of temporary and permanent injunctions, the majority of the arbitrators concluded that, when a party is [Page17:] seeking a permanent injunction, it is seeking in effect the ultimate remedy itself, which differs from damages only in that it is preventive rather than compensatory.32 In other words, what the party seeks is really a judgment on the merits of the dispute and not just a temporary measure of protection. In this way, the request amounts to an implicit waiver of arbitration. (The tribunal also held that it was of no avail to the claimant to say that this was not its intention.)

An equally explicit expression of the need to separate the granting of an interim measure from a decision on the merits of the underlying dispute can be found in the case Behring International, Inc. v. Islamic Republic of Iran Air Force, Iran Aircraft Industries. and The Government of the Islamic Republic of Iran, brought before the Iran - U.S. Claims Tribunal.33

In that case, the Respondent had requested interim measures providing, inter alia, for the transfer of its property from the claimant's warehouse to a new warehouse. In this respect, the tribunal determined that:

the granting of the full interim relief requested by Respondents, in particular, the transfer to Respondents of possession, custody and control of the warehoused goods (Respondent's title to which is not disputed by Claimant), would be tantamount to awarding the Respondents the final relief sought in their counterclaim. The Tribunal decides that, under the circumstances of this particular case, it cannot award such relief prior to determining as a final matter that it has jurisdiction.34

The point is that an arbitral tribunal will not anticipate its decision on the merits under the guise of an order for a conservatory measure and will not countenance that a party sought before a national court do the same. The same point has been made by domestic courts, most recently by the Court of Appeal of Paris in a decision dated June 12, 1992.35 The facts of the case may be summarized as follows.

An American company had transferred by contract its rights to the distribution of a movie series, for the Francophone countries, w a company incorporated in Liechtenstein. The contract provided for the settlement of any disputes between the parties by arbitration, and for the possibility for each party to request from a court an interim measure if need be.

By a subsequent agreement, the parties agreed that the Liechtenstein company would have an exclusive option on the distribution of a color version of the movie series, and that this option should be exercised under certain conditions.

After this later agreement, the American company that was the holder of the distribution rights transferred all its rights and obligations to a French company.

A dispute arose as to the conditions for the exercise of the exclusive option. In this context, with no arbitral tribunal having yet been constituted, the Liechtenstein company sought what it denominated to be certain "interim measures" from the French courts and, in particular, the recognition of its rights concerning the exclusive option.

By an order en référé dated February 28, 1992, the Tribunal de Commerce of Paris concluded that the Liechtenstein company retained its rights with respect to the option. But, upon appeal, the Court of Appeal of Paris partially reversed the decision of the "Tribunal de Commerce".

The Court of Appeal observed that under French law the only conservatory or provisional measures available prior to the constitution of an arbitral tribunal are those that do not entail a decision of the merits of the dispute and that by having included in this agreement an arbitration clause, the parties had reserved all consideration of the merits of a dispute for the arbitral tribunal. The issue relating to the exclusive option required of necessity a decision on the merits, and this evidently went against the clear intention of the parties as embodied in the arbitration clause. For dis reason, no interim measure ordered by a court could validly provide that the Liechtenstein company retained its rights with respect to the exclusive option.

Does the need to keep the granting of an interim measure separate from a decision on the merits mean Mata domestic court or arbitral tribunal will not look [Page18:] into the merits of the case at all? To answer this question it should be kept in mind that a national court or arbitral tribunal will always decide, as a preliminary issue, whether the ordering of the measure requested is within its authority. This requires that the merits of the case must be examined at least to the extent necessary to establish a prima facie jurisdiction over the case.

For example, in the case of The Messianiki Floga,36 a charter had filed a notice of lien on a vessel (the "Messianiki Floga") to obtain security for its claim for reimbursement for certain costs against the owner of the Messianiki Floga. Upon default on its mortgage payments, the owner arranged for conveyance of the vessel to a first preferred mortgagee in lieu of foreclosure. To avoid foreclosure, the owner then commenced arbitration against the charterer, whose notice of lien was holding up the conveyance. The owner requested from the arbitral tribunal an order to rescind the notice of lien.

In considering whether the relief requested was appropriate and within its authority, the arbitral tribunal heard evidence as to the likelihood of success of the charterer's claims and the probability of irreparable harm resulting from the granting or the denying of the requested relief. On this, the arbitral tribunal concluded that

the harm to Owner is of sufficient magnitude to invoke this panel's authority... This case involves a financial injury that cannot be recompensed by a damage award. As the relative probability of success on the merits as to the issues discussed favors the party seeking equity relief, we feel an award is justified.37

In other words, the arbitral tribunal felt that it had to consider (without deciding) the merits,38 albeit to the limited extent of ascertaining the likelihood of success and the probability of irreparable harm.39

VI. Is it in the nature of conservatory and provisional measures to be suitable only for time urgent situations?

Conservatory and provisional measures, by definition, presuppose the existence of a dispute between the parties which, as a rule, will be settled by a final decision on the merits. It was seen in the previous section how it follows from this distinction between the granting of an interim measure and the decision on the merits that domestic courts and arbitral tribunals will not (or, at any rate, should not) grant a decision on the merits under the guise of interim relief.

There is another side to this aspect of the matter. If it is true that an interim measure presupposes by necessity a prospective decision on the merits, it is also true that there would be no need for interim protection if the final decision on the merits could, in and of itself, satisfy all the interests of the parties at stake in a dispute.40

Hence, there is no doubt that conservatory measures are time sensitive: if a party could wait until a final decision on the merits, there would be no need at ail to apply for interim relief. But does this mean that "urgency" is always required?

No general answer can be given, as much will depend on the particular measure that is being sought as on the applicable 1aw.41 For present purposes, it is interesting to note that "urgency" seems to play an especially important role when an interim measure is requested from a domestic court in that the courts must respect the will of the parties to settle their disputes by arbitration. Accordingly, resort to a domestic court for interim protection should logically be restricted to situations of such urgency that the interests of a party would be seriously prejudiced by being required to await the constitution of an arbitral tribunal or even the final award rendered in the arbitration. (Of course, situations also exist where it is evident that, [Page19:] even once constituted, an arbitral tribunal would lack the authority to order the necessary interim measure.) 42

In this context, one can only express agreement with the arbitral tribunal in ICC case No. 4156.43 A dispute had arisen between a French supplier and a French purchaser in regard of a contract for the supply of certain materials destined for Libya. The question before the arbitral tribunal, sitting in Geneva, was whether the parties, by requesting from domestic courts certain measures for the appointment of an expert, had waived their right to arbitration.

The arbitral tribunal considered that both parties had decided to resort to domestic courts because of the "urgency" to ascertain certain facts:

Therefore, they have both adhered to an urgent measure decided en référé by a judicial authority that specified that it was not its intention to decide on the merits.44

Accordingly, the arbitral tribunal found that the parties had not waived their rights to arbitration, and held that it had jurisdiction.

VII. Conclusions

If the nature of conservatory and provisional measures is not susceptible to definition and may not be found by instinct or intuition, are we reduced to saying simply that "an interim measure is an interim measure is an interim measure"?

Once again, the response must be negative because to do so would suggest misleadingly a unity which does not exist. As was noted at the commencement of this paper, it is clear that one of the essential characteristics of these measures is their disparity.

We arrive, therefore, at an approach which perhaps should have been evident from the very title of this paper: the nature of these measures is best described by resorting to "Nature" itself and the classification system mankind has devised for it. Provisional measures belong to a common genus and share a number of common elements, but the genus is itself divided into at least two species, the particular characteristics of each reflecting the extent to which it has adapted to the environment in which it is to be found, national courts or arbitral tribunals.

Thus, conservatory and provisional measures which are ordered in the context of State courts tend to be legally binding and therefore "effective", but are often restricted to a given territory, that of the forum State. They are very time sensitive, because they are generally ordered in circumstances where the parties have no alternatives, the arbitral tribunal not yet having been constituted. These measures must be applied with great sensitivity, lest they cross the line and become a decision on the merits in violation of the parties' agreement to resolve the dispute by arbitration, perhaps putting at risk the right of a party to avail itself of the arbitration clause.

On the other hand, conservatory and provisional measures in the context of an arbitral tribunal need not (and often may not) be legally binding. However, precisely by virtue of this seeming "weakness", such measures are frequently directed beyond the confines of the situs State and, for the reasons described above, these measures are nonetheless often accepted by the parties. Provisional measures ordered by an arbitral tribunal are not always "time sensitive", as they often involve those categories of measures aimed at regulating the administration of evidence. Care should be taken by an arbitral tribunal not to resolve the merits of a dispute in the guise of an interim measure, especially if this were to put into question the rights of the defense, but absent such an error, perhaps the consequences of an arbitral tribunal crossing the boundary line between provisional measures and the merits are less grave than in the case of a national court, as it is, after all, the arbitral tribunal that has the final responsibility to decide the merits.

As in Nature, the characteristics and qualifies of conservatory and provisional measures evolve, 45 although in a mariner determined by man rather than any other force. The general direction of this evolution may, I believe, be perceived. National courts and arbitral tribunals [Page20:] are increasingly sensitive to each other's strengths and weaknesses insofar as the ordering of interim measures is concerned and seek to act as complements to each other rather than as competitors.

At the same time, evolution in the nature of these measures should - indeed must - have as a pole star the conviction that parties which opt for arbitration need not thereby unnecessarily forfeit essential advantages which they would have had in opting for litigation.

This does not mean cross-breeding the different species so as to produce a hybrid, i.e. giving equal powers to state courts and arbitral tribunals.

It does mean, though, that national courts should abandon any false (and destructive) modesty, such as that displayed by a U.S. Court of Appeals46 which considered itself precluded ipso facto by the New York Convention from ordering a pre-award attachment. It also means, I would suggest, that those who would favour giving greater legal force to the interim orders of arbitral tribunals must take care to avoid unintentionally diminishing the present freedom of arbitral tribunals to reach beyond the situs State. Such could be the result if States consider that these orders, especially when not reduced to arbitral awards, constitute too great an interference in their sovereignty.

The alert party involved in a dispute subject to an arbitration clause should be aware that the nature of conservatory and provisional measures is neither indivisible nor constant, the most significant variations depending upon whether the interim measure is considered in the context of a State court or an arbitral tribunal.

Finally, it must be admitted that the multiplicity of jurisdictions, almost as great as the number of species of plant and animal life together, precludes the possibility that the present analysis of the nature of conservatory and provisional measures be all-encompassing. State courts, arbitral tribunals and parties (and the authors of papers) must remain ever alert to the unforeseen and unimagined provisional platypus.

1
The views expressed herein are personal to the author. The author acknowledges with appreciation the assistance of Dr. Maurizio Ragazzi, White & Case, in the preparation of this paper.

2
Mirbeau-Gauvin, "Réflexions sur les mesures conservatoires", Recueil Dalloz Sirey 39, 47 (1989, 7e cahier).

3
Jacobellis v. Ohio, 378 U.S. 184, 197 (1964).

4
For example, the average duration of an ICC arbitration is about 18-24 months. See (Craig, Park & Paulsson, International Chamber of Commerce Arbitration 20 (2d ed. 1990). This compares favorably with the length of time between the commencement of proceedings and judgment in EC member States. See the comparative table appearing in Civil Procedures in EC Countries. An Industry Report 11-12 (McIntosh & Holmes ed. 1991).

5
Knoepfler & Schweizer, "Les mesures provisoires et l'arbitrage", in Recueil de Travaux Suisses 225 (Reymond & Bucher ed. 1984). It may be interesting to note that, in a recent decision dated June 11, 1992, relating to a proceeding under Article 86 of the EC Treaty, the EC Commission wrote that any interim measure taken by the Commission must be of a "temporary and conservatory nature and restricted to what is required in the given situation" (Case No. IV/34174, B&I v. Sealink, unpublished).

6
See Knoepfler & Schweizer, op. cit. 223-4. This tripartition was originally developed in the German literature.

7
Case C-213/89, R. v. Secretary of State for Transport ex p. Factorame (Judgment of June 19, 1990), [1990] E.C.R. 2433, 2457.

8
Semantically, "conservatory" measures can be viewed as a subcategory of "provisional" or "interim" measures. For example, Article 22, paragraph 1, of the AAA International Arbitration Rules provides that an arbitral tribunal "may take whatever interim measures it deems necessary in respect of the dispute, including measures for the conservation of the goods which are the subject-matter in dispute..." (Emphasis added.) But, as was noted earlier in the text when discussing the objectives of interim measures, not all provisional measures are conservatory, because certain provisional measures may, for example, provide for a party to undertake an act - such as establishing an escrow account which evidently does more than simply maintaining the status quo pending a decision on the merits of a dispute. Of course, this distinction is only a general one, and the key consideration will be, in each concrete case, how conservatory and provisional measures are defined under the relevant law. See Lalive, Poudret & Reymond, Le droit de l'arbitrage interne et international en Suisse 363-4 (1989); de Boisséson, Le droit français de l'arbitrage interne et international 255-6 (1990); Blessing, "National Report Switzerland" 4-5 (unpublished paper delivered at the ICCA Conference on Interim Measures and Arbitration, Bologna, April 19, 1991).

9
For comment, see Broggini, "I provvedimenti cautelari nell'arbitrato intemazionale: analogie e differenze delle soluzioni italiana e svizzera", 1 Rivista dell' arbitrato 487, 495-7 (1991). The recent amendments to the Italian Code of Civil Procedure introduced by Law No. 353 of November 26, 1990, have not modified the situation. See Luiso, "Arbitrato e tutela cautelare nella riforma del processo civile", Ibid. 253 (1991).

10
See Carpi, "Les mesures provisoires et l'arbitrage dans le système juridique italien" 6 (unpublished paper delivered at the ICCA Conference on Interim Measures and Arbitration, Bologna, April 19, 1991). For a summary of the papers read at the Bologna Conference, see "Seminario su 'Le misure d'urgenza e l'arbitrato' Bologna, 19 aprile 1991", 1 Ibid. 475 (1991).

11
According to Hoellering, "Interim Measures and Arbitration: The Situation In the United States", Arbitration Journal 22, 25 (June 1991) (and articles cited in note 26 thereof), by a pre-award attachment the creditor acquires a lien on the personal property of the debtor, and once it is filed this remedy may give a priority over the claims on the same property by subsequent creditors. Compare this view with the decision of the French Cour de Cassation, dated February 4, 1992, in which the decision of a court of appeals which refused to set aside an arbitral award was overturned because the arbitral award would have created a priority for the award creditor and the Cour de Cassation considered that the "principle of equality of the unsecured creditors" is a principle belonging to international as well as domestic public policy.

12
See Reichert, "Provisional Remedies in the Context of International Commercial Arbitration", 3 International Tax & Business Lawyer 373 (1986).

13
Mustill & Boyd, The Law and Practice of Commercial Arbitration in England 330 (2d ed. 1989).

14
Article 249 of the New Code of Civil Procedure reads as follows:"The judge may order a permit appointed by him to undertake an investigation.The investigator may not give any opinion as to the factual or legal consequences to be drawn therefrom."English translation from de Vries, Galston & Loening, French Law. Constitution and Selective Legislation 7-47 (1983).

15
In certain jurisdictions, security for costs is not provided even if the plaintiff resides abroad. See Ughi, "Attachments and other court remedies in support of arbitration - ITALY", in Interim Court Remedies in Support of Arbitration 99, 109 (Shenton & Kuhn ed. 1987).

16
[1992] 2 All ER 609; [1992] 2 WLR 741; [1992] 2 Lloyd's Rep 7; 56 Build. LR 18.

17
The present discussion is based on the unpublished text of the judgment, as approved by the Judge.

18
[1984] QB 291.

19
Quoted at p. 9 of the unpublished transcription from the Official Court Tape Recording.

20
Ibid. 13.

21
See, for example, the Canadian decision in the case Elesguro Inc. v. SsangYong Shipping Company (1980), 117 D.L.R. (3d) 105 (Fed. Ct. T. D.) (briefly discussed in Cosman, "Attachments and Other Interim Court Remedies in Support of Arbitration", in Interim Court Remedies, op. cit. 191, 200-1), and the decision of the French Cour de Cassation dated May 27, 1970, Bulletin Civil, I, No. 176 (referred to in Buhart, "Attachments and Other Interim Court Remedies in Support of Arbitration - French Law" ibid. 163, 166-7). Commenting on the decision of the "Tribunal de Grande Instance" of Paris dated June 10, 1982, in the case of Société Eurodif cl République Islamique d'Iran, Moreau remarked that "le juge des référés devra justifier sa compétence ratione loci et qu'il ne pourra le faire qu'en fonction du domicile des parties, car on ne concevrait pas que la seule localisation en France de la procédure arbitrale en dehors de tout lien de rattachement des parties avec la France suffise à justifier cette compétence." (Revue de l'arbitrage 181, 189 (1983).)

22
See Yakukazu Hanamizu, "Attachments and Other Interim Court Remedies in Support of Arbitration - Japan", Interim Court Remedies, op. cit. 127, 138-9.

23
For example, in MINE v. Republic of Guinea 14 Yrbk. Com. Arb. 82 (1989), an ICSID tribunal sitting in New York recommended, among other things, that MINE dissolve all attachments in Europe, i.e. a measure devoid of any legally binding force relating to proceedings outside of the situs State of the tribunal. In other cases in which the arbitral tribunal refused to recommend or modify an interim measure, there was no reference whatsoever to the absence of links with the situs State. See, e.g., the decision in the ICSID case Amco Asia Corp. et al. v. Republic of Indonesia, 11 ibid. 159 (1986), and the partial award in the ICC case No. 4998, Journal du droit international 1139 (1986). From the published extracts of arbitral awards, it is not always evident whether or trot the link with the situs State was a consideration for the tribunal's decision. In any event, the apparent absence of discussion of the issue in arbitral awards is in itself meaningful.

24
"An arbitral tribunal is not an instrumentality of any particular State" (M. Bogdan, "Some Arbitration-Related Problems of Swedish Private International Law", Swedish and International Arbitration, pp. 70,76 (1990); "... an international arbitration tribunal is a non-national institution; it owes no allegiance to any sovereign State; it has no lex fori in the conventional sense" (J. Lew, Applicable Law in International Commercial Arbitration, p. 535 (1978).

25
An additional question, which cannot be developed here, is the incidence of bilateral treaties providing for the reciprocal enforcement of provisional measures. See Ramos Mendez, "Arbitrage international et mesures conservatoires", Revue de l'arbitrage 51, 65 (1985).

26
Sec discussion of the case referred to at footnote 23 above.

27
Mustill & Boyd, op. cit. 91-2.

28
Partial award dated December 23, 1982, Case No. 3896, 10 Yrbk. Com. Arb. 47 (1985). The French original appears in Journal du droit international 914 (1983).

29
The author, at least, has not found any decision suggesting that the opposite is true.

30
"[Arbitrators] can, of course, advise the parties that the tribunal will draw whatever inferences it deems appropriate from a failure to comply with an instruction to produce evidence." Von Mehren, "Rules of Arbitral Bodies Considered from a Practical Point of View", 9 Int'l Arb. 105, 111 (1992).

31
ICC Case No. 5896, Award, para. 44 (unpublished).

32
Ibid. para. 61.

33
8 Iran - United States Claims Tribunal Reports 44 (1985-I). For comment, see Van Hof, Commentary on the UNCITRAL Arbitration Rides. The Application by the Iran U.S. Claims Tribunal 179-80 (1991).

34
Ibid. 46. The tribunal then granted certain other interim measures requested by the respondent which it considered appropriate to preserve the rights of the parties.

35
The decision is unpublished.

36
Society of Maritime Arbitrators, Inc. New York, Interim Ruling Award No. 2015, Aug. 24, 1985. The Interim Ruling Award is partially reproduced in 11 Yrbk. Corn. Arb. 209 (1986).

37
Ibid. 210.

38
here is no need to discuss here whether an arbitral tribunal has a wider latitude than a domestic court to look into the merits when requested to grain an interim measure.

39
If the request for an interim measure must not entail a decision on the merits of a dispute, a fortiori the provisional relief sought, whether before a court or an arbitral tribunal, cannot go beyond the claims alleged.

40
See Ouakrat, "L'arbitrage commercial international et les mesures provisoires: étude générale", 14 Droit et pratique du commerce international 239, 243 (1988, No. 2).

41
See, for example, the French decisions and commentaries appearing in Revue de l'arbitrage 113 (1989), Journal du droit international 1032 (1989), Revue de l'arbitrage 633 (1990), Journal du droit international1004 (1990).

42
See Jarvin's commentary on the decision on the ICC Case No. 3896, Journal du droit international 914, 918 (1983).

43
Journal du droit international 937 (1984).

44
Ibid. 940 (Author' s translation).

45
"Since 'tis Nature's law to change, Constancy alone is strange." John Wilmot, Earl of Rochester.

46
McCreary Tire & Rubber Co. v. CEAT, 501 F.2d 1032 (3d Cir. 1974).