PCA CASE N° 2019-46
IN THE MATTER OF AN ARBITRATION
BEFORE A TRIBUNAL CONSTITUTED IN ACCORDANCE WITH THE
TRADE PROMOTION AGREEMENT BETWEEN THE REPUBLIC OF PERU AND THE
UNITED STATES OF AMERICA
- and -
THE UNCITRAL ARBITRATION RULES 2013
-between-
THE RENCO GROUP, INC.
-and-
THE REPUBLIC OF PERU
PROCEDURAL ORDER NO. 13
The Arbitral Tribunal
Judge Bruno Simma (Presiding Arbitrator)
Prof. Horacio Grigera Naón
Mr. J. Christopher Thomas KC
5 August 2024
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1.1 Pursuant to the agreement of the Parties, this arbitration (the “Treaty Case”) is being coordinated with The Renco Group, Inc. and Doe Run Resources Corp. v. Activos Mineros S.A.C., PCA Case No. 2019-47 (the “Contract Case”).
1.2 On 8 April 2024, the Tribunal issued Procedural Order No. 12 for the Treaty Case and Procedural Order No. 13 for the Contract Case (the “Post-Hearing POs”), making determinations and providing instructions for post-hearing matters, including the post-hearing briefs (the “PHBs”). The Tribunal included a list of questions to the Parties to be answered in their PHBs (the “Questions”), indicating the following:
4.2 The PHBs should focus primarily on answering the Questions appended to this Procedural Order as Annex 2, but the Parties may also address other matters they deem pertinent for both Cases. To that end, the Parties are free to answer the questions in whichever order they choose, but are requested to use separate headings for each question, clearly indicating which question they are replying to. Where the questions are only directed to one of the Parties, the other Party is nevertheless invited to comment, if it so wishes.
[...]
4.4 The Parties shall not submit any new evidence or legal authorities in their PHBs. They are invited to provide appropriate references to the record for each question, where necessary. If there is no record evidence to support an answer to any of the questions, this shall be noted by the Party when responding to such question(s).
1.3 On 21 June 2024, the Parties submitted their respective PHBs.
1.4 By letter dated 27 June 2024, the Tribunal granted the Parties an opportunity to respond to the opposing Party’s PHB and indicated the following:
The Tribunal notes that, contrary to paragraph 4.4 above, the Claimants submitted Exhibits 1 to 13 along with their PHB, and that the Respondents indicated in footnotes 3, 4, and 7 of their PHB their readiness to submit documents to substantiate specific points for which they allege there is no record evidence. Further, the Claimants have referred in footnote 71 to a news item and the Respondents in footnote 176 to the Public Works Information System where further documentation could be found, both of which also represent evidence that should be filed as factual exhibits if granted leave by the Tribunal.
Accordingly, in light of paragraph 4.4 of the Post Hearing Procedural Orders and paragraph 6.4 of Procedural Order No. 1 of both Cases, the Tribunal requests the Parties to submit any comments they may have regarding the admission of these documents into the record by Wednesday, 3 July 2024.
1.5 By respective letters dated 3 July 2024, the Parties submitted their comments on the admission of the documents.
1.6 The Claimant argued that (i) in its view, many of the Questions reflected an acknowledgment that the existing record did not provide sufficient guidance, thus, inviting the Parties to submit additional evidence, especially regarding the Missouri Litigations and the Inter-American Court of Human Rights (the “Inter-American Court”) Judgment; and (ii) submitting the exhibits related to both matters was more convenient for the Tribunal rather than including references to the publicly available documents. It requested the Tribunal to grant leave admitting both Parties’ exhibits and provide them with an opportunity to submit counter-evidence in their responses to the opposing Party’s PHB.
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1.7 The Respondent asserted that (i) the Claimant’s exhibits violated paragraph 4.4 of the Post-Hearing POs and many of them violate the rule that “a Party cannot make new arguments in a later submission that properly should have been made part of an earlier one;” (ii) some of the documents are already in the record and need not be readmitted; and, therefore, (iii) the Claimant’s conduct amounts to another instance of disregard for the procedural rules of the arbitration. Accordingly, it requested the Tribunal to refuse to admit all exhibits submitted with the Claimant’s PHB and reserved its rights to object to the Claimant’s “other violations” at the appropriate moment.
1.8 By letter dated 11 July 2024, the Tribunal invited the Respondent to submit any additional objections it had with respect to the Claimant’s PHB.
1.9 By letter dated 15 July 2024, the Respondent (i) argued that the Claimant submitted in its PHB “new arguments that they could have submitted earlier,” which “extend[ed] beyond a direct response to the specific question;”¹ (ii) clarified that except for the arguments on the substantive denial of justice Question, it did not object to arguments that directly responded to one of the Questions; and (iii) requested the Tribunal to strike the Claimant’s “extemporaneous arguments” raised in its PHB (the “Request to Strike”).
1.10 By letter dated 19 July 2024, the Claimant responded to the Respondent’s Request to Strike, arguing that (i) necessarily, new points emerge, new events occur, and facts are revealed over the course of a hearing calling upon parties to react and fashion new arguments; (ii) the Tribunal permitted generous post-hearing briefing to give the Parties a full opportunity to be heard by addressing their Questions and any other pertinent matters; (iii) the same rules should apply to both Parties, who submitted new arguments and exhibits; (iv) the Tribunal should allow the Parties to submit the best information available since they were already given an equal opportunity to be heard through their responses to each other’s PHBs; and (v) there is no denial of due process as the Respondent has enjoyed full opportunities to make its case.
2.1 The Claimant submitted 13 exhibits with its PHB and referred to a link in a footnote of its PHB, while the Respondent indicated its readiness to submit documents in three footnotes and referred to the Public Works Information System in a footnote. The Parties disagree on whether the Claimant should have submitted the exhibits and as to their admissibility, and agree that the Respondent’s documents should be admitted. Moreover, the Respondent submits that the Claimant raised extemporaneous arguments that must be stricken from the record, which the Claimant contests.
2.2 The Tribunal will address first the applicable standard to these matters and then turn to the analysis of the admissibility of the Parties’ documents and the Respondent’s Request to Strike.
2.3 Post-Hearing matters, including PHBs and additional evidence thereto, are governed by the Post-Hearing POs, which appended the Questions as Annex 2. Where necessary, the Tribunal will refer to other rules established in previous Procedural Orders and directions, which, as it indicated in its letter dated 7 February 2024, it intends to follow strictly.
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2.4 Regarding the admissibility of documents, given the nature of certain Questions, the Tribunal foresaw specific instances in which there might not be record evidence to support an answer. It instructed the Parties in paragraph 4.4 of the Post-Hearing POs to simply note the absence of record evidence when responding to such questions. The Tribunal emphasizes, however, that this instruction was given only in relation to the Questions and not to other matters that the Parties wished to address in their PHBs. On that basis, the Tribunal intended to decide whether to request the production and submission of documents indicated by the Parties that were related to the Questions, pursuant to Article 27(3) of the UNCITRAL Rules and paragraph 5.3 of Procedural Order No. 1 of both Cases.
2.5 Accordingly, contrary to the Claimant’s view, the Questions did not reflect “an acknowledgement that the existing record did not provide sufficient guidance for the Tribunal to complete its task,” allowing the Parties to submit new evidence or legal authorities. Not only did the Tribunal expressly prohibit the submission of “any new evidence or legal authorities in their PHBs”, but it also requested the Parties “to provide appropriate references to the record for each question, where necessary.” Therefore, as stated in the Tribunal’s letter dated 27 June 2024, the Claimant contravened the procedural rules when submitting 13 new exhibits and a link to a news item. This breach, however, does not preclude an assessment by the Tribunal of whether any documents should be produced and submitted based on what the Claimant noted in its PHB instead of the improperly submitted exhibits and news item. Against this backdrop, the Tribunal will conduct its analysis of the admissibility of documents indicated by the Parties.
2.6 Regarding the Request to Strike, the Tribunal reiterates the rule, as articulated in its letter dated 14 September 2023 and subsequently reaffirmed in Procedural Order No. 9 of the Treaty Case and Procedural Order No. 10 of the Contract Case, that “a Party cannot make new arguments in a later submission that properly should have been made part of an earlier one.” In this context, concerning the PHBs, the Tribunal notes that Annex 2 of the Post-Hearing POs affirmed that the Questions were “intended to enhance the Tribunal’s understanding of the dispute.” These Questions invited the Parties to clarify or further develop previously submitted arguments or to provide additional details not yet in the record, as mentioned above. Furthermore, paragraph 4.2 of the Post-Hearing POs allowed the Parties to “also address other matters they deem pertinent for both Cases,” which necessarily includes responding to issues that arose during the Hearing. Therefore, only arguments in the PHBs that are unrelated to the Questions or matters that arose during the Hearing, and that should have properly been made part of an earlier submission must be stricken.
2.7 The Tribunal also notes that, by its letter dated 27 June 2024, it provided the Parties with an opportunity to respond to the PHBs “in the interest of due process and to enhance its understanding of the dispute.” Accordingly, any concern a Party may have regarding their ability to respond to the arguments properly raised in the opposing Party’s PHB—including new arguments which both Parties contend were made²—has already been addressed by the Tribunal.
2.8 Having considered the exhibits and news item mentioned in the Claimant’s PHB and the Respondent’s objections, the Tribunal makes the following determinations:
2 Claimant’s Letter dated 19 July 2024, p. 2, fn. 2. See generally Respondent’s Letter dated 15 July 2024. ↩
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| Document | Analysis | Determination |
|---|---|---|
| Minutes of the Extraordinary General Shareholders Meeting for Doe Run Mining S.R. Ltda. Dated October 16, 1997 (Exhibit 1) | The Claimant asserts that this document is the one documenting the matters the Tribunal asked about in Question 3(a),³ which the Respondent was unable to find it in its records.⁴ Therefore, the Tribunal considers that the submission of the document into the record would benefit both Parties and the Tribunal’s understanding of the dispute. | The Tribunal requests the submission of this document as an exhibit. |
| Reid, ECF No. 1322 (Exhibit 2) | The Claimant states that this document shows the current status of one of the Missouri Litigations (the Reid case), regarding which the Tribunal asked in its Question 1(a). There appears to be no record evidence on this matter and, hence, the Tribunal considers that the document should be submitted into the record. | The Tribunal requests the submission of this document as an exhibit. |
| Reid, ECF No. 474 (Exhibit 3) | According to the Claimant, these documents relate to Question 1(b) concerning the causes of actions of the Missouri Litigation. Nevertheless, the Respondent argues that these documents are already in the record, specifically as R-18, R-292, R-294, and R-309.⁵ | The Tribunal requests the submission of these documents as exhibits subject to the Claimant’s review on their not duplicating exhibits already in the record. |
| Reid, ECF No. 949 (Exhibit 4) | ||
| Collins, ECF No. 1, Exs. 1&2 (Exhibit 5) | Although the Tribunal considers that these documents should be admitted, it invites the Claimant to first compare its documents with the already submitted exhibits, since the submission of the former would only be necessary to the extent that they are not already in the record. Since the Respondent considers that Exhibit 6 is already in the record, the Tribunal does not find it necessary to make any finding regarding the Respondent’s objection to it being used to support a “tardy and baseless argument”. | |
| Collins, Collins, ECF No. 296 (Exhibit 6) | ||
| A.A.Z.A., et al. v. Doe Run Resources Corporation, et al., Case No. 4:07-cv-01874-CDP, ECF No. 1-1 (Exhibit 7) | The Claimant indicates that this document relates to Question 1(e) regarding the type of contamination dealt with by the Missouri Litigation claims. The document, the Claimant quotes, mentions the types of emissions in discussion in the Missouri Litigation.⁶ Accordingly, the Tribunal considers that it is relevant for Question 1(e) for which there appears to be no record evidence and should be submitted into the record. | The Tribunal requests the submission of this document as an exhibit. |
| Reid, ECF No. 1232, Motion for Summary Judgment Under Missouri Law (Exhibit 8) | The Claimant mentions these documents as part of its answer to Question 1(e), specifically to refute that the Missouri Litigations concern contaminants other than lead. In particular, it states that these documents show that Renco and DRRC “have extensively briefed the absence of evidence supporting non-lead-based claims.”⁷ The Respondent objects to their inclusion, arguing that they are improperly used to submit a new argument over which the Tribunal lacks jurisdiction. | The Tribunal requests the submission of these documents as exhibits. |
| Reid, ECF No. 1233, Memorandum in Support re: Motion |
3 Claimant’s PHB, fn. 2. ↩
4 Respondent’s PHB, ¶¶ 76-79. ↩
5 Respondent’s Letter dated 3 July 2024, Annex A. ↩
6 Claimant’s PHB, pp. 13-14. ↩
7 Claimant’s PHB, p. 15. ↩
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| for Summary Judgment Under Missouri Law (Exhibit 9) | To the extent that these documents support the context provided by the Claimant in its answer to Question 1(e) for which there is no record evidence, the Tribunal considers that the documents should be submitted into the record. The Tribunal makes no assessment on the jurisdictional issues raised by the Respondent. Also, as addressed in paragraph 2.19, the Tribunal does not consider this argument to be extemporaneous. | |
| Reid, ECF No. 1301, Reply to in Support of Defendants’ Motion for Summary Judgment Under Missouri Law (Exhibit 10) | ||
| Reid, ECF No. 1225-1 (Matson Rept. 12/1/20) (Exhibit 11) | The Claimant refers to these documents as part of an argument unrelated to the Tribunal’s Questions, i.e., the standard of care relevant to the Missouri Litigations and its relation to the PAMA.⁸ Since the Tribunal only provided the opportunity to indicate the absence of record evidence in relation to the Questions, these documents shall not be submitted. | The Tribunal does not request the submission of these documents. |
| Reid, ECF No. 1225-6 (Matson Rept. 5/28/21) (Exhibit 12) | ||
| Report No. 76/09, August 5, 2009, IACHR (Exhibit 13) | The Tribunal notes that, according to the descriptions provided by the Parties,⁹ this document concerns the proceedings before the Inter-American Commission of Human Rights (the “Inter-American Commission”) and not the recent Judgment by the Inter-American Court. Therefore, the document is unrelated to the Questions and shall not be submitted. | The Tribunal does not request the submission of this document. |
| News article dated 29 May 2024 (Footnote 71) | In its comments to the Inter-American Court Judgment pursuant to Question 10, the Claimant argues that “Peru has done virtually nothing to improve the plight of La Oroya and its citizens”¹⁰ and that “even after the IACHR’s March 22, 2024 decision levels of sulphur dioxide emissions exceeded limits recommended by the Inter-American Court on 39 days.”¹¹ Hence, to the extent that the article effectively discusses the Judgment and Peru’s actions afterwards, the Tribunal considers that it should be submitted. | The Tribunal requests the submission of this document as an exhibit subject to it referring the Inter-American Court Judgment. |
2.9 Having considered the exhibits and database mentioned in the Respondent’s PHB and the Claimant’s agreement to their admission, the Tribunal makes the following determinations:
| Document | Analysis | Determination |
|---|---|---|
| (i) Docket Entry 1380, dated 5 | According to the Respondent, these documents are all related to Question 1(a) concerning the current status of the | The Tribunal requests the |
8 Claimant’s PHB, p. 33, fn. 33. ↩
9 Claimant’s PHB, p. 72; Respondent’s Letter dated 3 July 2024, Annex A. ↩
10 Claimant’s PHB, p. 73. ↩
11 Claimant’s PHB, fn. 71. ↩
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| September 2023, for case number 4:11-cv-00044-CDP in the Eastern District of Missouri | Missouri Litigations. In particular, they relate to the status of both the Reid and Collins cases. As stated above, there appears to be no record evidence on this matter and, hence, the Tribunal considers that the documents should be submitted into the record. | submission of these documents as exhibits. |
| (ii) Docket Entry 92, dated 9 January 2024, for case number 23-1625 in the United States Court of Appeals for the Eighth Circuit | ||
| (iii) Docket Entry 840, dated 30 April 2024, for case number 4:15-cv-01704-RWS in the Eastern District of Missouri | ||
| Documents in the Public Works Information System (INFOBRAS) | In response to Question 6(f) concerning any revegetation or soil remediation since the end of the plant’s operations and the liquidation of DRP, the Respondent argued that “[t]he company continues to undertake soil remediation and restoration efforts in La Oroya today” and that such activities were documented in the Public Works Information System (INFOBRAS). The Tribunal considers that the Respondent should submit documents that support its assertion within the timeframe provided in Question 6(f). | The Tribunal requests the submission of this (these) document(s) as exhibit(s). |
2.10 The Tribunal will analyze each of the sections from the Claimant’s PHB that the Respondent has requested to strike as follows. The Tribunal underscores that it makes no assessment on the weight or substance of any of the arguments.
2.11 The Respondent states that the argument related to the Claimant’s alleged consent to two assignments of contractual position¹² is extemporaneous because (i) it does not directly answer Question 8; (ii) the issue was raised in document production, pre-hearing pleadings, expert reports, and at the Hearing, and the Claimant had refused to respond to it until its PHB; (iii) the Claimant had never alleged that there were documents or evidence of its consent to the assignments; (iv) the Claimant supports its arguments with allegedly misleading references unrelated to the matter; and (v) the Respondent would need to present new legal authorities and
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an updated expert report by Dr. Varsi to rebut this new argument, which it is unable to do at this stage.¹³
2.12 The Claimant rejects the argument that its argument should be stricken since (i) the Parties were not limited to the Tribunal’s Questions; (ii) it was pertinent to refer to the effectiveness of the assignments vis-à-vis the Claimant’s standing in the context of Question 8; (iii) it is only the Respondent who has focused on documentary evidence, rendering it unnecessary for the Claimant to prove consent; and (iv) the argument is not extemporaneous, as it finds a basis in Dr. Payet’s reports and his testimony.¹⁴
2.13 As previously mentioned, the Tribunal must assess whether this argument and all arguments below are unrelated to the Questions or matters that arose at the Hearing and should have properly been made part of an earlier submission. Question 8 directly concerns hearing testimony from Dr. Payet, which the Claimant disputed in its PHB providing a different interpretation regarding the assignments. Therefore, the consent to assignment argument relates to a matter that arose at the Hearing and is related to Question 8. Moreover, the Respondent has an opportunity to reply to this issue in its response to the Claimant’s PHB. Considering that both Parties agree that the Respondent has consistently submitted arguments and evidence on this issue, it is not clear to the Tribunal why it would only be able to respond through new legal authorities and expert reports. Hence, the Tribunal rejects the Respondent’s Request to Strike regarding this argument.
2.14 According to the Respondent, the argument that Activos Mineros owed duties under Clauses 5 and 6 only to the Claimant¹⁵ is extemporaneous and contradicts the Claimant’s previous position given that (i) the Claimant and Dr. Payet had previously asserted that the Clauses encompassed anyone who could be sued; and (ii) its request for relief has been limited to indemnity being owed to only Renco and DRRC and not to the Renco Consortium members and related entities and individuals.¹⁶
2.15 The Claimant considers that its argument is not extemporaneous because (i) the Respondent has grounded this argument in the language of the STA throughout the proceedings; (ii) its position does not differ from its prior one or the testimony at the Hearing; and (iii) its argument reflects this arbitration dealing with claims only against Renco and DRRC.¹⁷
2.16 In the Tribunal’s view, narrowing the scope of an argument or request for relief cannot be understood as a “new argument”. It recalls that paragraph 4.3 of the Post-Hearing POs requested the Parties to “include in their PHBs a final articulation of their requests for relief for each Case.” Also, given that the Respondent has consistently contended that Clauses 5 and 6 of the STA do not grant a right to indemnity to the Claimant, it is not clear how an allegedly narrower argument by the Claimant affects due process or precludes the Respondent from replying in its response to the Claimant’s PHB. Consequently, the Tribunal rejects the Respondent’s Request to Strike regarding this argument.
13 Respondent’s Letter dated 15 July 2024, pp. 3-5, Annex A. ↩
14 Claimant’s Letter dated 19 July 2024, pp. 2-3. ↩
15 Claimant’s PHB, pp. 6-7. ↩
16 Respondent’s Letter dated 15 July 2024, pp. 5-7, Annex A. ↩
17 Claimant’s Letter dated 19 July 2024, pp. 3-4. ↩
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2.17 The Respondent asserts that the Claimant’s argument that the claims in the Missouri Litigations regarding substances other than lead are deficient¹⁸ is extemporaneous because (i) the Claimant abdicated its obligation to prove its case by not providing evidence or argument on the matter previously; (ii) it never replied to the Respondent’s argument on the impossibility of foreseeing the decision in the Missouri litigations; and (iii) it asks the Tribunal to interfere with two pending domestic litigations.¹⁹
2.18 In the Claimant’s view, the argument should not be stricken given that (i) whether the claims involve lead only or additional substances is irrelevant for purposes of the Respondent’s contractual responsibility; (ii) the Tribunal asked broadly about the claims in the Missouri Litigations; and (iii) the response to the Question was based directly on the Missouri Litigations pleadings.²⁰
2.19 The Claimant’s argument directly answers Question 1(e). Thus, the Tribunal rejects the Respondent’s Request to Strike regarding this argument.
2.20 The Respondent affirms that the Claimant’s argument that MEM was the only one that could find a breach of the PAMA²¹ is extemporaneous and should be stricken because (i) it was raised for the first time in the PHB; (ii) it is not linked to the Questions; and (iii) the Respondent would not have the opportunity to present rebuttal argument, supporting authorities, or expert reports.²²
2.21 According to the Claimant, the argument should be admitted given that (i) it is based on exhibits R-25 and R-201, which have long been in the record; (ii) Ms. Alegre was cross-examined on these exhibits and argument during the Hearing; (iii) the evidence was repeated during the closing statement; (iv) the Respondent replied to this argument in its PHB; and (iv) even if it were a new argument, the Respondent waived its complaint by allowing the evidence in the Hearing and its own briefing.²³
2.22 The Tribunal reiterates that an argument not being directly linked to a Question is not a motive to strike. At the very least, as indicated by the Claimant, this argument was raised at the Hearing without objection from the Respondent. Further, it notes that in its PHB, the Respondent already replied to this argument and also referred to a moment at the Hearing concerning it. Therefore, the Tribunal rejects the Respondent’s Request to Strike regarding this argument.
2.23 In the Respondent’s view, the Claimant’s request for the Tribunal to draw adverse inferences against it due to it not offering “any witness statement from any person with knowledge of Centromin’s standards and practices”²⁴ is extemporaneous since the Claimant never made this
18 Claimant’s PHB, pp. 13-16, fn. 22. ↩
19 Respondent’s Letter dated 15 July 2024, pp. 7-8, Annex A. ↩
20 Claimant’s Letter dated 19 July 2024, p. 4. ↩
21 Claimant’s PHB, pp. 19-21. ↩
22 Respondent’s Letter dated 15 July 2024, p. 8, Annex A. ↩
23 Claimant’s Letter dated 19 July 2024, pp. 4-5. ↩
24 Claimant’s PHB, fn. 48 (Claimant’s emphasis). ↩
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request before, even though it knew the identity of the Respondent’s witnesses and experts with every submitted pleading.²⁵
2.24 The Claimant rejects the Respondent’s position, arguing that it merely pointed out the failure to call witnesses and suggested that the Tribunal may draw adverse inferences, but that the Tribunal is free to decide on the matter.²⁶
2.25 Irrespective of whether the Claimant made a “suggestion” or a “request”, the Tribunal considers that it was made within the context of Questions 2(a), 4(a)-(e), and 5 related to the phrase “standards and practices” under the STA. Consequently, the Tribunal rejects the Respondent’s Request to Strike regarding this argument.
2.26 The Respondent states that the Claimant’s argument that its subrogation claim is not time-barred because it failed to effect payment²⁷ is extemporaneous since (i) it is the first time the Claimant makes this argument; (ii) it does not respond to Question 9; and (iii) the Claimant could have raised this argument in its Reply or in its Rejoinder on Jurisdiction, but did not.²⁸
2.27 The Claimant posits that this is “the clearest example of Respondents exalting their view of technical rules over the truth”, given that (i) the Respondent conceded the Claimant’s argument; and (ii) the Claimant and Dr. Payet have long asserted that any subrogation claim is timely.²⁹
2.28 The Tribunal reiterates that an argument not being directly linked to a Question is not a reason to strike. The Claimant’s argument, as understood by the Parties, is that the subrogation claim is not time-barred since it arises only once a claim is paid and the claim has not yet been paid. The Respondent noted that Dr. Payet had already mentioned in his second report that subrogation operates once payment has been effected and had mentioned, albeit for other reasons, that the subrogation claim could not be time-barred. In addition, the Respondent has acknowledged that the Claimant’s alleged “new argument” is “true as a matter of logic”. Given such acknowledgment, even if some parts of the argument were considered new, the Tribunal does not see any detriment it would cause to the due process rights of the Respondent, who in any event has an additional opportunity to respond. Therefore, the Tribunal rejects the Respondent’s Request to Strike regarding this argument.
2.29 According to the Respondent, the Claimant’s argument that MEM allegedly had an outsized and improper influence in the bankruptcy proceedings³⁰ is extemporaneous because (i) the Claimant had never made this argument in respect to its “substantive” denial of justice claim; and (ii) it would violate the Respondent’s due process if the Claimant were allowed to merge its denial of justice claims after representing that it would not pursue its procedural denial of justice claim.³¹
25 Respondent’s Letter dated 15 July 2024, p. 8, Annex A. ↩
26 Claimant’s Letter dated 19 July 2024, p. 5. ↩
27 Claimant’s PHB, p. 64. ↩
28 Respondent’s Letter dated 15 July 2024, p. 9, Annex A. ↩
29 Claimant’s Letter dated 19 July 2024, pp. 5-6. ↩
30 Claimant’s PHB, pp. 65-66, 68. ↩
31 Respondent’s Letter dated 15 July 2024, pp. 9-10, Annex A. ↩
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2.30 The Claimant considers that, since it was only summarizing the opinions of the first expert report of Mr. Schmerler, the Respondent cannot state that it was taken by surprise.³²
2.31 The Tribunal notes that the Claimant’s argument on MEM’s alleged influence was made in the context of Questions 6(a), (c)-(e). Additionally, at no point in those sections does the Claimant mention denial of justice. The Tribunal also recalls that the Claimant has raised arguments on MEM’s role in the bankruptcy proceedings regarding other claims, e.g., its FET claim. Finally, as pointed out by the Claimant, it directly cited Mr. Schmerler’s first expert report to substantiate its argument. Thus, the Tribunal rejects the Respondent’s Request to Strike regarding this argument.
2.32 The Respondent contends that the Claimant’s invocation of various judgments for its denial of justice claim (i.e., the 4th Transitory Administrative Contentious Court, the 8th Chamber of the Lima Superior Court, and the Supreme Court of Justice of Peru)³³ is extemporaneous, given that (i) even though the Tribunal asked in Question 7 about the judicial measures that were part of the substantive denial of justice claim, the Claimant had never mentioned the three judgments as part of it; and (ii) the Claimant merging its procedural denial of justice claims with its substantive denial of justice claim after representing that it would no longer pursue the former violates the Respondent’s due process rights.³⁴
2.33 In the Claimant’s view, the argument is a direct response to the Tribunal’s Question which also cites where in the record the Claimant’s arguments against the judgments can be found.³⁵
2.34 The Tribunal notes that, in its Memorial, as cited by the Respondent, and its Reply, the Claimant refers to “domestic courts”,³⁶ “decisions upholding the MEM’s [...] credit”,³⁷ “years of appeals to numerous higher courts”,³⁸ among others. This led the Tribunal to seek clarification through Question 7 of the specific judicial measures being disputed in the substantive denial of justice claim. As recognized by both Parties, the Claimant’s listing of the decisions in dispute was a direct answer to Question 7, which does not present any new information. Consequently, the Tribunal rejects the Respondent’s Request to Strike regarding this argument.
2.35 The Respondent affirms that the Claimant’s argument that Peru’s alleged admissions before the Inter-American Commission should be given weight³⁹ is extemporaneous considering that (i) Question 10 refers to the Inter-American Court’ 2024 Judgment and not the 2009 report concerning proceedings before Inter-American Commission; and (ii) the Claimant makes the arguments of the 2009 report for the first time in its PHB.⁴⁰ Additionally, the Respondent considers that the Claimant’s argument that Peru failed to conduct clean-up efforts⁴¹ should also
32 Claimant’s Letter dated 19 July 2024, p. 6. ↩
33 Claimant’s PHB, pp. 68-69. ↩
34 Respondent’s Letter dated 15 July 2024, pp. 10-11, Annex A. ↩
35 Claimant’s Letter dated 19 July 2024, p. 6. ↩
36 Treaty Memorial, ¶ 290. ↩
37 Treaty Memorial, ¶ 291. ↩
38 Reply, ¶ 142. ↩
39 Claimant’s PHB, pp. 72-73. ↩
40 Respondent’s Letter dated 15 July 2024, p. 11, Annex A. ↩
41 Claimant’s PHB, pp. 73. ↩
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be stricken because (i) it is irrelevant to the legal issues before the Tribunal; and (ii) was never raised before.⁴²
2.36 The Claimant asserts that its argument on the Inter-American Court Judgement should be admitted because (i) any argument regarding the Judgment would necessarily be new as the Inter-American Court proceedings were barely mentioned in the record before the Questions; and (ii) if the Tribunal were to strike the Claimant’s arguments it should also strike the Respondent’s.⁴³ The Claimant also argues, regarding the clean-up efforts, that (i) the Tribunal is interested in this topic, as indicated in its letter of 27 June 2024; and (ii) the Respondent addressed this matter in its PHB and the Claimant is entitled to do so too.⁴⁴
2.37 The Tribunal notes that Question 10 relates to the Judgment of the Inter-American Court and not the proceedings before the Inter-American Commission. Also, the Claimant’s argument on the latter does not respond to any issue that arose during the Hearing, constituting a new argument that should have been raised in a previous submission and that must, thus, be stricken. However, the Tribunal notes that the Claimant does appear to refer to the Judgment and related matters, such as the clean-up efforts, which shall not be stricken. Hence, the Tribunal strikes the paragraphs and corresponding citations of pages 72 and 73 of the Claimant’s PHB as follows:
While little or no weight should be accorded to the IACHR decision itself, the Tribunal should give weight to the positions taken by Peru in the proceeding. When faced with allegations that environmental contamination in La Oroya constituted violations of the American Convention on Human Rights, Peru defended its conduct by touting the measures that had been taken by Centromin and DRP to improve the environment. Peru argued in 2009 that “in keeping with its international obligations, it has been taking progressive, consistent, cross-cutting, and multisectoral measures to bring about optimal air quality levels, to counteract the health problems of the affected population, and to monitor the activities of the Doe Run Company.”⁶⁸
In the IACHR proceeding, Peru noted that water quality standards for various metals, including lead, had been brought within international standards.⁶⁹ It cited the 2008 Blacksmith report as evidence of “improvement stemming from measures taken by [DRP].”⁷⁰ It opposed the imposition of sanctions by IACHR as unwarranted. In short, Peru took positions before the IACHR directly inconsistent with the assertions made in this arbitration. Peru’s effort to convince this Tribunal that its standards and practices during Centromin’s operations were more protective of the environment and public health are disingenuous.
No one denies that the decades of Centromin’s operations created a public health and environmental crisis in La Oroya, or that even after the substantial efforts made by DRP that much work remains to be done. Perhaps the most salient conclusion to be drawn from the IACHR decision is that in the 15 years since DRP ceased operations, Peru has done virtually nothing to improve the plight of La Oroya and its citizens.⁷¹ We can all express regret at that unhappy circumstance, while acknowledging it answers none of the issues confronting this Tribunal.⁴⁵
3.1 Having considered the views expressed by the Parties and for the reasons given above, the Tribunal hereby decides to:
42 Respondent’s Letter dated 15 July 2024, p. 11, Annex A. ↩
43 Claimant’s Letter dated 19 July 2024, p. 6. ↩
44 Claimant’s Letter dated 19 July 2024, pp. 6-7. ↩
45 Claimant’s PHB, pp. 72-73. ↩
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3.1.1. request the Parties to submit the exhibits requested by the Tribunal in paragraphs 2.8 and 2.9 by Tuesday, 6 August 2024; and
3.1.2. reject the Respondent’s Request to Strike, except in relation to the Claimant’s argument on Peru’s alleged admissions before the Inter-American Commission, which shall be stricken as determined by the Tribunal in paragraph 2.37 above.
So ordered by the Tribunal.
Signature
Judge Bruno Simma
(Presiding Arbitrator)
On behalf of the Tribunal