Global developments brought to you monthly by the ITA Board of Reporters
General Editor: Roger Alford
Managing Editors: Elina Mereminskaya & Monique Sasson
Volume XV - Issue 1
February 2017
 
 
 
 
Recent Cases and Awards (13)
 
 
ECOM Agroindustrial Asia Pte Ltd. v. Qingdao Jinchangjiang Group Textile & Garments Co., Ltd. (Reply of the Supreme People's Court to a Request of the Shandong Higher People’s Court for Instructions on the Application for Recognition and Enforcement of an Arbitral Award of the International Cotton Association Filed by ECOM Agroindustrial Asia Pte Ltd.), Supreme People's Court of the People's Republic of China, , 24 September 2015
 
In the judicial review of the enforceability of a foreign arbitral award, the Supreme People's Court holds that the question on whether an arbitration agreement exists shall be determined as a question of fact by the court accepting the case rather than itself under the Prior Reporting Sytem. 
 
Author(s): Jingzhou Tao, Dechert LLP Beijing
 
Source: A contribution by the ITA Board of ReportersDate: 3 Feb 2017
 
Reporter for: China
 
China Full text Full text as PDF
 
 
 
 
 
Luntai Lvyuan Agroforestry Development Co., Ltd. v. Productos Agrovin, Sociedad Anonima (Reply of the Supreme People's Court to the Request for Instructions from Beijing High People’s Court on the Application for Setting Aside the [2014] China CIETAC Jing No. 526 Award by Luntai Lvyuan Agroforestry Development Co., Ltd.), Supreme People's Court of the People's Republic of China, , 28 October 2015
 
As for re-arbitration, under the PRC Arbitration Law (1995), PRC courts have discretion to decide the conditions for re-arbitration of a case, although in practice the courts usually consult the arbitration institutions before ruling for re-arbitration.
It is noteworthy that the PRC court would look into the fact finding of the Arbitral Tribunal before deciding whether to report the case under the Prior Reporting System, though the court is supposed to focus on examining procedural aspect of the arbitration in annulment proceedings.
 
 
Author(s): Jingzhou Tao, Dechert LLP Beijing
 
Source: A contribution by the ITA Board of ReportersDate: 3 Feb 2017
 
Reporter for: China
 
China Full text Full text as PDF
 
 
 
 
 
OLG Celle – 13 Sch 1/15, Higher Regional Court of Celle, 13 Sch 1/15, 14 October 2016
 
In a decision dated October 14, 2016, the Higher Regional Court of Celle held a court may fully review whether an arbitral body properly considered antitrust law, as the court’s public policy review may concern any public policy violation. A court generally will not set aside the award if the tribunal’s decision is justifiable.
 
Author(s): Richard H. Kreindler, Cleary Gottlieb Steen & Hamilton LLP
 
Source: A contribution by the ITA Board of ReportersDate: 3 Feb 2017
 
Reporter for: Germany
 
Germany Full text Full text as PDF
 
 
 
 
 
Insolvency Administrator of Walter Bau AG v. Kingdom of Thailand, Federal Court of Justice of Germany, I ZB 13/15, 06 October 2016
 
Claimant received a foreign arbitral award in violation of a contractual obligation with a third party. A court may not declare such an award to be uneforceable for violating the ordre public according to sec. 1061 para. 1 s. 1 of the German Code of Civil Procedure (Zivilprozessordnung or “ZPO”) in connection with Art. V para. 2 lit. b) of the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards.
 
Author(s): Richard H. Kreindler, Cleary Gottlieb Steen & Hamilton LLP
 
Source: A contribution by the ITA Board of ReportersDate: 3 Feb 2017
 
Reporter for: Germany
 
Germany Full text Full text as PDF
 
 
 
 
 
OLG München – 34 SchH 5/16, Higher Regional Court of Munich, 34 SchH 5/16, 24 November 2016
 
Under the European Convention on International Commercial Arbitration of 1961 (the “European Convention”), a national court proceeding concerning the admissibility of an arbitration proceeding pursuant to section 1032 para 2 of the German Code of Civil Procedure (Zivilprozessordnung or “ZPO”) must be suspended at a party’s request, without any final review of the existence of an arbitration agreement, unless a good and substantial reason hinders the suspension. In determining whether such a reason exists, the court must assess the validity of the arbitration agreement prima facie and consider the right to effective judicial protection. 
 
Author(s): Richard H. Kreindler, Cleary Gottlieb Steen & Hamilton LLP
 
Source: A contribution by the ITA Board of ReportersDate: 3 Feb 2017
 
Reporter for: Germany
 
Germany Full text Full text as PDF
 
 
 
 
 
Global Quality Foods Pvt. Ltd. v. Hardee's Food Systems, Inc., High Court of Sindh, Suit No. 838, 19 November 2015
 
The case related to request for stay by the Plaintiff on basis of alleged exclusive rights to develop the Hardee's restaurants in Sindh, Pakistan and by the Defendant on the basis of Section 34 of the Arbitration Act, read with Section 4 of the Foreign Awards Enforcement Act, 2011 and Section 29 of the Multi-Unit-License Agreement in view of the arbitration agreement contained in the Multi-Unit-License Agreement. It involved questions of applicability of choice of law and arbitration clause contained in the International Multi-Unit-License Agreement and the International Development Agreement. 
 
Author(s): Nudrat Piracha, Samdani & Qureshi, Inc.
 
Source: A contribution by the ITA Board of ReportersDate: 3 Feb 2017
 
Reporter for: Pakistan
 
Pakistan Full text Full text as PDF
 
 
 
 
 
ASG v. ASH [2016] SGHC 130, Supreme Court of Singapore, High Court, Originating Summons No. 288 of 2015, 22 July 2016
 
ASG v ASH [2016] SGHC 130 (“ASG”) is the latest in a long line of cases showcasing the approach taken by the Singapore courts when faced with allegations of breach of natural justice in setting aside proceedings. In ASG, Coomaraswamy J reiterated the position taken by the Singapore Court of Appeal in AKN v ALC [2015] 3 SLR 488 (“AKN”) that a court will not infer that a tribunal has failed to consider an important pleaded issue unless such an inference was shown to be “clear and virtually inescapable” (AKN at [46]). In addition, Coomaraswamy J held that the Singapore courts would “be slow to draw inferences about whether an arbitrator has applied his mind to the issues in an arbitration from the questions which the arbitrator asks” [ASG at [107]].
Apart from issues of natural justice, Coomaraswamy J also considered the status of a correction award and a separate costs award that had been issued by the arbitrator in an attempt to take back his original ruling on costs (which had been issued in error). Coomaraswamy J found that the correction award and separate costs award were invalid as the arbitrator had become functus officio on the issue of costs when he made the costs order in the principal award.
 
Author(s): Michael Hwang, Michael Hwang Chambers LLC
 
Source: A contribution by the ITA Board of ReportersDate: 3 Feb 2017
 
Reporter for: Singapore
 
Singapore Full text Full text as PDF
 
 
 
 
 
Rals International Pte Ltd v. Cassa di Risparmio di Parma e Piacenza SpA [2016] SGCA 53, Supreme Court of Singapore, Court of Appeal, Civil Appeal No. 75 of 2015, 05 September 2016
 
Does an assignee of promissory notes carry with it the obligation to arbitrate a dispute contained in an underlying contract? Should the assignee be considered a party within section 6(5)(a) of the International Arbitration Act (Cap 143A, 2002 Rev Ed) (the “IAA”)? Does an assignee’s claim for payment under the promissory notes fall within the scope of an arbitration agreement to which the assignee was not a party?
Under section 6 of the IAA, a stay in proceedings is mandatory if the applicant is found to have satisfied the criteria that the claimant is a party to an arbitration agreement and the subject matter of the proceedings is the subject of the arbitration agreement. The Court of Appeal in Rals International Pte Ltd v Cassa di Risparmio di Parma e Piacenza SpA [2016] 5 SLR 455 was asked to consider whether an assignee of a promissory note for payment under a separate agreement fell within the definition of a party to an arbitration agreement (which includes any person claiming through or under such party) in section 6(5)(a) of the IAA.
In its consideration of whether the assignee’s claim for payment fell within the scope of an arbitration agreement, the Court of Appeal examined the approach to the construction of arbitration clauses regarding disputes arising from bills of exchange (such as promissory notes in the present case). It also analysed the nature of such negotiable instruments and the commercial expectations of parties in their use of these instruments.
 
Author(s): Michael Hwang, Michael Hwang Chambers LLC
 
Source: A contribution by the ITA Board of ReportersDate: 3 Feb 2017
 
Reporter for: Singapore
 
Singapore Full text Full text as PDF
 
 
 
 
 
Jiangsu Overseas Group Co, Ltd v. Concord Energy Pte Ltd and another matter [2016] SGHC 153, Supreme Court of Singapore, High Court, Originating Summonses Nos 730 and 731 of 2015, 10 August 2016
 
In Jiangsu Overseas Group Co Ltd v Concord Energy Pte Ltd and another matter [2016] 4 SLR 1336, the Singapore High Court (Steven Chong J) was invited to find that two related arbitral awards ought to be set aside for the tribunal’s want of jurisdiction, because the relevant contracts containing the arbitration agreement were unsigned and hence uncompleted contracts.
The Court found the contracts to have been validly concluded on the basis of the party’s conduct. Consequently, the arbitration agreements were valid and the tribunal had jurisdiction to hear the disputes.
The interesting issue of whether a party which had elected to avoid arbitral proceedings should be precluded from adducing evidence - which could have been brought before the tribunal - to rebut the tribunal’s finding was raised. The Court noting that two High Court decisions took different positions, did not decide on the issue.
 
Author(s): Michael Hwang, Michael Hwang Chambers LLC
 
Source: A contribution by the ITA Board of ReportersDate: 3 Feb 2017
 
Reporter for: Singapore
 
Singapore Full text Full text as PDF
 
 
 
 
 
Dyna-Jet Pte Ltd v. Wilson Taylor Asia Pacific Pte Ltd [2016] SGHC 238, Supreme Court of Singapore, High Court, Suit No. 1234 of 2015 (Registrar’s Appeal No. 43 of 2016), 31 October 2016
 
Party A and Party B enter into a dispute-resolution agreement. The agreement confers the right to elect to arbitrate on Party A only. If Party A elects not to arbitrate and pursues litigation instead, can Party B stay the proceedings?
The scenario above arose squarely for the Singapore High Court’s determination in Dyna-Jet Pte Ltd v Wilson Taylor Asia Pacific Pte Ltd [2016] SGHC 238 (“Dyna-Jet”). The High Court analysed the case to see if it surmounted the two hurdles for a stay application to succeed: first, that the dispute-resolution agreement is an “arbitration agreement” and second, that the dispute-resolution agreement is not “null and void, inoperative or incapable of being performed”. In the process, the High Court provided clarification on the definitions of “arbitration agreement”, “null and void”, “inoperative” and “incapable of being performed”.
 
Author(s): Michael Hwang, Michael Hwang Chambers LLC
 
Source: A contribution by the ITA Board of ReportersDate: 3 Feb 2017
 
Reporter for: Singapore
 
Singapore Full text Full text as PDF
 
 
 
 
 
BBW v. BBX and others [2016] SGHC 190, Supreme Court of Singapore, High Court, Suit No. 689 of 2016 (Summons No. 3539 of 2016), 09 September 2016
 
In this judgment, the High Court (the “Court”) offered clarification on the scope of application of ss 23 and 23 of the International Arbitration Act (Cap 143A, 2002 Rev Ed) (the “IAA”) and the inherent power of the Court. The High Court explained why ss 22 and 23 of the IAA could not be relied upon in this instance for a sealing order. It also considered the question of whether the Court had an inherent power to grant sealing orders, given the lack of any statutory or judicial pronouncement on this issue. 
 
Author(s): Michael Hwang, Michael Hwang Chambers LLC
 
Source: A contribution by the ITA Board of ReportersDate: 3 Feb 2017
 
Reporter for: Singapore
 
Singapore Full text Full text as PDF
 
 
 
 
 
Nibulon SA v. Public Joint Stock Company "Rise" (enforcement of a GAFTA award with compound interest), Supreme Court of Ukraine, Case No. 759/16206/14-ц (Proceeding No. 6-1197цс16), 26 October 2016
 
The Supreme Court of Ukraine opined on recognition and enforcement of the arbitral award with compound interest formula.
 
Author(s): Yaroslav Petrov, Asters; Anna Tkachova, Asters
 
Source: A contribution by the ITA Board of ReportersDate: 3 Feb 2017
 
Reporter for: Ukraine; Ukraine
 
Ukraine Full text Full text as PDF
 
 
 
 
 
Essar Oilfields Services Limited v. Norscot Rig Mangament PVT Limited [2016] EWHC 2361 (Comm), High Court of Justice of England and Wales, Queen's Bench Division, Commercial Court, Case No. CL-2016-000188, 15 September 2016
 
1As a matter of language, context and logic,"other costs" in the context of s59(1)(c) of the Arbitration Act 1996 could include the costs of obtaining litigation funding. The expression should not be confined by some legal straightjacket imposed by reason of what a court might or might not be permitted to order. Litigation funding costs fall within the arbitrator's general costs discretion.2Section 68(2)(b) of the Act is engaged if an arbitrator acts in excess of his powers not when he erroneously exercises a power thatb he did have. An erroneous exercise of power itself could in theory almost always be re-described as an excess of power. However, there is a real and vital distinction to be made between the two.3The words of s.73 of the Act are plain, and the statutory waiver is not confined to cases where an earlier objection might have brought about a different course of action on the part of the arbitrator or indeed the other side at the time. There was no causal requirement in s.73, which should be applied strictly in order to give effect to the underlying aim which is that any intended objection based on irregularity or improper conduct of the arbitrator should be expressed by the party complaining about it in those terms at the time, so that there is no doubt about it.4Merely because a party has sought a corrected award pursuant to s.57(3), that did not without more extend time. The application to correct must be material to the issuebeing raised under s.68(2). A correction is material if it is necessary to enable the party to know whether he has grounds to challenge the Award or not. If the grounds of challenge were known and were not dependent on the outcome of the correction application, time runs from the date of the original Award.
 
Author(s): Nicholas Fletcher, Berwin Leighton Paisner LLP
 
Source: A contribution by the ITA Board of ReportersDate: 3 Feb 2017
 
Reporter for: United Kingdom of Great Britain and Northern Ireland
 
United Kingdom Full text Full text as PDF
 
 
 
 
 
Upcoming Events (3)
 
 
Bergisch Gladbach: 15th Petersberger Schiedstage (17-18 February 2017)
 
On February 17 and 18, 2017, the 15th Petersberger Schiedstage will be held at the Althoff Grandhotel Schloss Bensberg in Bergisch Gladbach. The over-arching topic this year is “IP Arbitration.” Speakers include Joachim Feldges, Clemens Heusch, Thomas Kutschaty, Stefan Kröll, Karim Nili, Günter Pickrahn, Stephan Simon, Matthias Schneider, Claudia Tapia, Axel Walz and Carsten Zülch.
 
Author(s): Richard H. Kreindler, Cleary Gottlieb Steen & Hamilton LLP
 
Source: A contribution by the ITA Board of ReportersDate: 3 Feb 2017
 
Reporter for: Germany
 
Germany Full text
 
 
 
 
 
Washington, DC: 14th Annual ITA-ASIL Conference: Third-Party Funding in International Arbitration: Legal and Ethical Considerations (12 April 2017)
 
The ½-day ITA-ASIL Conference is presented annually in Washington, D.C. by the ITA Academic Council with the American Society for International Law (ASIL) immediately preceding the ASIL Annual Meeting. Scholarship is the hallmark of this conference, the papers from which are published in the law journal World Arbitration and Mediation Review. The conference concludes with a networking luncheon.
 
Author(s): Reporter ITA
 
Source: A contribution by the ITA Board of ReportersDate: 3 Feb 2017
 
United States of America Full text
 
 
 
 
 
Plano, TX: 29th Annual ITA Workshop: Challenges to the Legitimacy of International Arbitration (14-16 June 2017)
 
The ITA Workshop, held in Dallas on the third Thursday in June every year since 1989, is widely recognized as the leading conference in the field in the United States. As one participant summarized succinctly, “It is the forum in which legitimate top practitioners gather annually. Thus, the topics are sophisticated, the networking is legitimate, and the social element is valuable.” The Workshop now begins on the preceding Wednesday afternoon, with membership activities continuing into the following Friday.
On Friday morning following the Workshop, members of the ITA Advisory Board, Academic Council, ITAAR Board of Reporters, WAMR Board of Editors, ITAFOR Moderators and Contributors, and the Workshop faculty reassemble for the annual ITA Forum and other membership activities.
 
Author(s): Reporter ITA
 
Source: A contribution by the ITA Board of ReportersDate: 3 Feb 2017
 
United States of America Full text
 
 
 
 
 
 
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