Transcript STUDYING LAW AT ROME TRE INTERNATIONAL ARBITRATION …

STUDYING LAW AT ROMA TRE
FALL SEMESTER
INTERNATIONAL ARBITRATION
Domenico Di Pietro
18 October 2010
Article II(3)
3. The court of a Contracting State, when
seized of an action in a matter in respect
of which the parties have made an
agreement within the meaning of this
article, shall, at the request of one of the
parties, refer the parties to arbitration,
unless it finds that the said agreement is
null and void, inoperative or incapable of
being performed
RESISTING ENFORCEMENT
ARTICLE V(1)
1. Recognition and enforcement of the
award may be refused, at the request of
the party against whom it is invoked, only
if that party furnishes to the competent
authority where the recognition and
enforcement is sought, proof that: […]
RESISTING ENFORCEMENT
ARTICLE V(2)
2. Recognition and enforcement of an
arbitral award may also be refused if the
competent authority in the country where
recognition and enforcement is sought
finds that: […]
ARTICLE V(1)(A)
1.
Recognition and enforcement of the award may be
refused, at the request of the party against whom it is
invoked, only if that party furnishes to the competent
authority where the recognition and enforcement is
sought, proof that:
(a) The parties to the agreement referred to in article II
were, under the law applicable to them, under some
incapacity, or
the said agreement is not valid under the law to
which the parties have subjected it or, failing any
indication thereon, under the law of the country where
the award was made;
ARTICLE V(1)(B)
1. Recognition and enforcement of the award may be
refused, at the request of the party against whom it is
invoked, only if that party furnishes to the competent
authority where the recognition and enforcement is
sought, proof that:
(b) The party against whom the award is invoked was
not given proper notice of the appointment of the
arbitrator or of the arbitration proceedings or was
otherwise unable to present his case; or
ARTICLE V(1)(C)
1. Recognition and enforcement of the award may be
refused, at the request of the party against whom it is
invoked, only if that party furnishes to the competent
authority where the recognition and enforcement is
sought, proof that:
(c) The award deals with a difference not contemplated
by or not falling within the terms of the submission to
arbitration, or it contains decisions on matters beyond
the scope of the submission to arbitration, provided that,
if the decisions on matters submitted to arbitration can
be separated from those not so submitted, that part of
the award which contains decisions on matters
submitted to arbitration may be recognized and
enforced; or
ARTICLE V(1)(D)
1. Recognition and enforcement of the award may be
refused, at the request of the party against whom it is
invoked, only if that party furnishes to the competent
authority where the recognition and enforcement is
sought, proof that:
(d) The composition of the arbitral authority or the
arbitral procedure was not in accordance with the
agreement of the parties, or, failing such agreement,
was not in accordance with the law of the country where
the arbitration took place; or
ARTICLE V(1)(E)
1. Recognition and enforcement of the award may be
refused, at the request of the party against whom it is
invoked, only if that party furnishes to the competent
authority where the recognition and enforcement is
sought, proof that:
(e) The award has not yet become binding on the
parties, or has been set aside or suspended by a
competent authority of the country in which, or under the
law of which, that award was made.
ARTICLE V(2)
2. Recognition and enforcement of an arbitral
award may also be refused if the competent
authority in the country where recognition and
enforcement is sought finds that:
(a) The subject matter of the difference is not
capable of settlement by arbitration under the
law of that country; or
(b) The recognition or enforcement of the award
would be contrary to the public policy of that
country.
NULL AND VOID, INOPERATIVE AND
INCAPABLE OF BEING PERFORMED
• Null and Void
- identification of the relevant Law
• Inoperative
– arbitration agreement is conditional
– arbitration agreement is explicitly or implicitly revoked or
modified
– Res judicata
• Incapable of being performed
– Inconsistency (conflict with other contractual provisions)
– Uncertainty
– Deadlock clauses
PATHOLOGICAL CLAUSES
General Comments
• Not enough time devoted to the dispute
resolution clause
• Complexity of deal does not necessarily mean
complexity of clause
• Examples:
– Wrong name/no longer existing arbitral institution (Court
of Commercial Arbitration with seat in London)
– Appointment ad personam
– Conflicting jurisdictions (court vs. arbitration)
• Courts and arbitral institutions inclined to help?
Should they?
• What do you do in the presence of a defective
clause?
ICC MODEL CLAUSE
All disputes arising out of or in
connection with the present contract
shall be finally settled under the Rules of
Arbitration of the International Chamber
of Commerce by one or more arbitrators
appointed in accordance with the said
Rules.
CAM MODEL CLAUSE
Any dispute arising out of or related to
the present contract shall be settled by
arbitration under the Rules of the
Chamber of Arbitration of Milan (the
Rules), by a sole arbitrator / three
arbitrators, appointed in accordance with
the Rules.
(Seriously) Pathological Clauses
The Chairman of the Tribunal, in the
absence of agreement between the
parties, will be appointed by:
“… The President of the Court of
Castration in France…”
ANALYSING ARBITRATION CLAUSES I
“Any dispute or claim by one party against the other
shall be amicably resolved by the Parties’
representatives. Should the settlement negotiations
fail, any difference relating to the interpretation of
this agreement, shall be amicably resolved by
arbitration under the rules of the international
arbitration court. The arbitration shall be held in
London or Paris, at the exclusive choice of the
defendant. The parties submit to the exclusive
jurisdiction of the English courts”
ANALYSING ARBITRATION CLAUSES II
“In case of disputes, if any, arbitration, London”
LUCKY-GOLDSTAR INTERNATIONAL
LTD V. NG MOO KEE ENGINEERING
LTD
High Court of Hong Kong - 5 May 1993
THE ARBITRATION AGREEMENT
“Any dispute or difference arising out of this
contract shall be arbitrated in a 3rd Country,
under the rule of a 3rd Country and in
accordance with the rules of procedure of the
International Commercial Arbitration
Association.”
LUCKY-GOLDSTAR
PATHOLOGIES OF THE AGREEMENT
• The institution provided for in the clause, namely
the “International Commercial Arbitration
Association” did not exist.
• No seat of arbitration was specified
• The rather ambiguous reference to “a 3rd
Country” made no sense
• There was no indication which this “3rd Country”
might be
LUCKY-GOLDSTAR
HIGH COURT OF HONG KONG DECISION
• A common mistake do not nullified the agreement
to arbitrate.
• Clear intention of the parties to go to arbitration is
not nullified by the fact that the organisation for
settling such disputes does not exist.
• Arbitration agreement was not "inoperative or
incapable of being performed"
• Claimant could commence ad hoc arbitration at
any place other than in countries of the parties’
place of business.
LUCKY-GOLDSTAR
HIGH COURT OF HONG KONG DECISION
“the correct approach in this case is to satisfy
myself that the parties have clearly express the
intention to arbitrate any dispute which may
arise under this contract. As to the reference to
the non-existent arbitration institution and rules, I
believe that the correct approach is simply to
ignore it. I can give no effect to it and reject all
reference to it so as to be able to give effect to
the clear intention of the parties”
LUCKY-GOLDSTAR
CONCLUSION
Even if this case indicates that to name a
nonexistent arbitration association will not
prevent the parties from arbitrating, parties
intending to arbitrate should ascertain whether
the nominated arbitration association actually
exists. As a matter of fact, the parties eventually
lost time and money, as they had first to resort to
a national court before finally starting arbitration
proceedings.