Arbitration Agreements

The International Swaps and Derivatives Association (ISDA) has released draft arbitration clauses to its members for consultation.

The US Court of Appeals for the Fourth Circuit ruled that the US Supreme Court's Concepcion decision, holding that the Federal Arbitration Act (FAA) preempted a state law dealing with arbitration, does not extend so far as to preempt a Maryland law that requires arbitration clauses in contracts to be supported by consideration. 

The US Court of Appeals for the Second Circuit has held that federal common law provides the meaning of "arbitration" under the Federal Arbitration Act (FAA) for the purpose of determining whether there is federal question subject-matter jurisdiction.

The Supreme Court of the State of Washington has voided an arbitration clause in an insurance contract based on a state law prohibiting insurers from requiring arbitration of insurance disputes. The court held that the McCarran-Ferguson Act shields the state law from pre-emption by the Federal Arbitration Act (FAA).

The Brazilian Superior Court of Justice (STJ) has overturned a decision rendered by the Court of Appeals of Mato Grosso (TJMT), and recognised the authority of the judiciary to conclude the terms of submission agreements when parties have only agreed on a "blank" arbitration clause.

We have published an article discussing the treatment of the "arbitration exclusion" in the recast of the Brussels Regulation.

The United States Court of Appeals for the Eighth Circuit has granted a motion to compel arbitration of a Fair Labor Standards Act claim by upholding a class action waiver in the arbitration agreement.

On 23 November 2012, the Swedish Supreme Court dismissed an appeal by the Moscow City Golf Club OOO relating to an SCC arbitral award issued on 11 May 2010. In the award, the Golf Club was ordered to repay Nordea Bank AB a bank loan originating from 1990, together with interest and costs. The court rejected arguments relating to arbitrability and the validity of the arbitration agreement.

In a landmark German-language decision of 16 October 2012, the Swiss Supreme Court ruled that the insolvency of the Portuguese respondent did not affect its capacity to be a party in an arbitration seated in Switzerland. In its detailed conclusions, the Supreme Court revisited its decision in Vivendi v Elektrim and addressed the criticism to which that decision gave rise.

The Supreme Court of the United States has vacated the Oklahoma Supreme Court’s decision declaring a non-competition agreement null and void because, under federal law, the determination should have been left to an arbitrator.

The High Court in Dublin has refused an application by a third party for a stay of proceedings under the UNCITRAL Model Law, as incorporated into Irish law by the Arbitration Act 2010, and under the court’s inherent jurisdiction. However, Mac Eochaidh J accepted that there may be circumstances in which a defendant may seek a stay in favour of arbitration where it is not itself a party to the arbitration clause it seeks to rely on.

We have updated our collection of ad hoc arbitration clauses to include a sample clause for Canada, with integrated drafting notes. (Free access).

We have updated our collection of ad hoc arbitration clauses to include a sample clause for France, with integrated drafting notes. (Free access).

We have updated our collection of waiver of sovereign immunity clauses to include a sample clause for Sweden, with integrated drafting notes. (Free access).

Abby Cohen Smutny (Partner) and Lee A. Steven (Counsel) and Daniel J. Hickman (Associate), White & Case LLP The United States Court of Appeals for the Fifth Circuit has held that a district court’s attempt to resolve an impasse over the selection of an arbitral panel, by disregarding the parties’ arbitration agreement requiring the constitution of a three arbitrator panel and ordering the parties to proceed to arbitration before five arbitrators, exceeded the district court’s appointment authority under the Federal Arbitration Act (FAA).

Abby Cohen Smutny (Partner) and Lee A. Steven (Counsel) and Daniel J. Hickman (Associate), White & Case LLP The United States Court of Appeals for the Second Circuit has affirmed a district court’s confirmation of an arbitral award, finding that the arbitration agreement’s incorporation of the UNCITRAL Arbitration Rules demonstrates that the parties "clearly and unmistakably" intended to leave the question of arbitrability to an arbitrator.

Abby Cohen Smutny (Partner) and Lee A. Steven (Counsel), Leah Witters (Associate) and Daniel Hickman (Associate), White & Case LLP The United States District Court for the Eastern District of Virginia has declined to recognise incorporation of the International Chamber of Commerce arbitration rules in an agreement to arbitrate as "clear and unmistakable" intent to let the arbitral panel decide threshold questions of arbitrability.

Stephan Wilske (Partner) and Stephan T. Meyer (Associated Partner), Gleiss Lutz In a decision dated 29 March 2012, but only recently published, the Higher Regional Court of Munich considered the validity and enforcement of an arbitration agreement contained in general trade terms and conditions which the parties had modified in a convoluted manner. Ultimately, the court was able to determine the parties’ intention and correctly decided to implement the clause even though one party alleged a lack of transparency.  

Joanne Greenaway (Professional Support Lawyer) and Dominic Kennelly (Associate), Herbert Smith LLP The English Commercial Court has provided guidance on the circumstances in which third parties seeking to enforce contractual provisions (pursuant to the Contract (Rights of Third Parties) Act 1999 (CRTPA) will be subject to an arbitration agreement in the relevant contract.  Essentially, Blair J finds that a party will be treated as a party to the arbitration agreement if they are seeking to enforce a substantive term of the contract.

Abby Cohen Smutny (Partner) and Lee A. Steven (Counsel), Leah Witters (Associate) and Daniel Hickman (Associate), White & Case LLP The United States District Court for the Southern District of New York has granted a motion to dismiss an action and to compel arbitration, finding that a broad arbitration clause in a business relationship and shareholder agreement covered a dispute over the parties’ corporate relationship and shareholder rights. 

Abby Cohen Smutny (Partner) and Lee A. Steven (Counsel), Leah Witters (Associate) and Daniel Hickman (Associate), White & Case LLP The United States Court of Appeals for the Fifth Circuit has reversed a district court’s confirmation of an arbitral award where the arbitrator authorised class arbitration. The court found that the arbitrator exceeded his authority by allowing class arbitration with no contractual basis for doing so.

PD Dr. Nathalie Voser (Partner) and Eliane Fischer (Associate), Schellenberg Wittmer (Zurich) In a German-language decision of 8 March 2012, published on 20 April 2012, the Swiss Supreme Court set aside an award in which an arbitral tribunal of the Court of Arbitration for Sports (CAS) had found that it had jurisdiction to hear a case opposing a third party beneficiary of a contract to one of the parties to the contract.

Natalia Belomestnova (Senior Associate) and Tatiana Zakharova (Paralegal), Goltsblat BLP On 19 June 2012, the Presidium of the Russian Supreme Commercial Court will consider the validity of so-called alternative hybrid arbitration clauses. In this particular case, the clause provides that only one party has the right to choose the dispute resolution forum.

Abby Cohen Smutny (Partner) and Lee A. Steven (Counsel), Leah Witters (Associate) and Daniel Hickman (Associate), White & Case LLP The Second Circuit has affirmed the denial of a motion to compel arbitration by a purported third-party beneficiary of the contract when the plain language of the arbitration agreement did not contemplate third-party participation.

Brendan Green (Associate), Herbert Smith LLP The Paris Court of Appeal has upheld the execution of an arbitral award rendered in Solingen, Germany.  The appellant had argued that the award should not be enforced because the arbitration clause was invalid and it was unable to fully participate in the proceedings as the language of the arbitration was German.

Natalia Belomestnova (Senior Associate), Goltsblat BLP On 27 February 2012, the public prosecution office in Saint Petersburg ordered a construction company to remove arbitration clauses from all of its contracts with its clients. The order was issued as a result of an investigation by the prosecution office into the construction company’s activity and its compliance with legislation, in particular consumer protection laws.

Abby Cohen Smutny (Partner) and Lee A. Steven (Counsel), Leah Witters (Associate) and Daniel Hickman (Associate), White & Case LLP Relying on the Supreme Court’s recent decision in AT&T Mobility LLC v Concepcion, the United States Court of Appeals for the Ninth Circuit has held that the Federal Arbitration Act (FAA) preempts state substantive unconscionability laws from invalidating class action waivers in arbitration clauses.

PD Dr. Nathalie Voser (Partner) and Aileen Truttmann (Associate),  Schellenberg Wittmer (Zurich) In a French-language decision dated 4 January 2012 and published on 23 February 2012, the Swiss Supreme Court ruled that a waiver in an arbitration clause of the right to apply to the Supreme Court to set aside an award does not affect the right to a fair trial granted by Article 6 of the European Convention on Human Rights.

Abby Cohen Smutny (Partner) and Lee A. Steven (Counsel), Leah Witters (Associate) and Daniel Hickman (Associate), White & Case LLP The United States District Court for the Southern District of New York has granted a motion to compel arbitration, finding that an arbitration clause was part of a revised offer made during contract negotiations and accepted by both parties.

Abby Cohen Smutny (Partner) and Lee A. Steven (Counsel), Leah Witters (Associate) and Daniel Hickman (Associate), White & Case LLP The United States Court of Appeals for the Second Circuit has held that a class action arbitration waiver is unenforceable because individual claims to vindicate federal statutory rights, rather than a class action, were shown to be financially unfeasible.

Stephan Wilske (Partner) and Claudia Krapfl (Associated Partner), Gleiss Lutz In a decision dated 4 April 2011, but only recently published, the Higher Regional Court of Frankfurt am Main held that a party who, in court proceedings, raises the objection of a valid arbitration agreement is barred from objecting to the jurisdiction of the arbitral tribunal in arbitration proceedings. This behaviour is contradictory and is in violation of the principle of good faith.

Stephan Wilske (Partner) and Claudia Krapfl (Associated Partner), Gleiss Lutz In a decision dated 11 July 2011, but only recently published, the Higher Regional Court of Munich held that the burden of proof to show that an arbitration agreement constitutes collusion and is therefore invalid lies with the party resisting enforcement of an arbitral award.

PD Dr. Nathalie Voser (Partner) and Hannah Boehm (Associate), Schellenberg Wittmer (Zurich) In a German-language decision dated 7 November 2011 and published on 29 December 2011, the Swiss Supreme Court held that a panel of the Court of Arbitration for Sport (CAS) had rightly interpreted a pathological arbitration clause contained in an agreement between a football club and a football agency in order to assume its jurisdiction to decide on the dispute regarding transfer fees.

Brendan Green (Associate), Herbert Smith LLP The Versailles Court of Appeal has referred a dispute to arbitration, dismissing objections that the case raised issues of public policy  barring the parties from having recourse to arbitration, and that one of the parties had waived its right to do so by litigating several related disputes before French courts.

Abby Cohen Smutny (Partner) and Lee A. Steven (Counsel), Leah Witters (Associate) and Daniel Hickman (Associate), White & Case LLP The United States District Court for the Southern District of New York has stayed an action pending arbitration based on its inherent power to manage its docket, where a choice of law issue made it uncertain whether two of the three defendants in the action, who were non-signatories to the arbitration agreement, could compel arbitration of claims against them.

Abby Cohen Smutny (Partner) and Lee A. Steven (Counsel), Leah Witters (Associate), White & Case LLP The US Supreme Court has vacated a Florida Court of Appeal decision that upheld a trial court’s denial of a motion to compel arbitration because the Court of Appeal found that two of the four claims at issue were non-arbitrable and so failed to address the remaining two claims.

In BNP Paribas SA v Open Joint Stock Company Russian Machines and another [2011] EWHC 308 (Comm), Blair J considered various issues relating to the service out of the jurisdiction of an arbitration claim form seeking anti-suit injunctive relief.

Abby Cohen Smutny (Partner) and Lee A. Steven (Counsel), Leah Witters (Associate), White & Case LLP The United States District Court for the Middle District of Florida has found that an arbitrator, and not the court, must decide whether the actions of the parties prior to filing in court were sufficient to fulfill the conditions precedent to arbitration included in the parties’ arbitration agreement.

Abby Cohen Smutny (Partner) and Lee A. Steven (Counsel), Leah Witters (Associate), White & Case LLP The Eleventh Circuit Court of Appeals has reversed a district court decision and found that when a plaintiff amends a complaint to unexpectedly expand the scope of litigation, the defendant may compel arbitration, even if the defendant previously waived that right.

Andrew Robertson (Partner) and Ryan Kuss (Law Clerk), Piper Alderman In a decision dated 22 June 2011, the Queensland Supreme Court has considered the circumstances in which an arbitral award can give rise to an issue estoppel in subsequent proceedings.

PLC Magazine has published an article on the UK Supreme Court decision in Jivraj v Hashwani [2011] UKSC 40, written by Kieron O'Callaghan and Ben Hornan of Hogan Lovells International LLP. (Free access).

Priyanka Gandhi (Associate) and Neha Samant (Trainee), Juris Corp In a recent decision, the Supreme Court of India has held that if an instrument is not registered, but is required to be mandatorily registered, an arbitration clause in the instrument is valid and enforceable. However, if the instrument is not duly stamped, the arbitration clause in the instrument cannot be enforced.

Natalia Belomestnova (Senior Associate), Goltsblat BLP In a decision of 24 May 2011, which only recently became available, the Russian Supreme Commercial Court has issued its final ruling in Sberbank v Business-Lada, Lada-Forward LLC et al (case N A55-11220/2010). The court annulled the judgments of the lower courts that enforced the arbitral awards and rejected the claimant’s request for enforcement because of the suspicion of partiality.

Abby Cohen Smutny (Partner) and Lee A. Steven (Counsel), Leah Witters (Associate), White & Case LLP The Second Circuit Court of Appeals has held that an arbitrator did not exceed her authority when deciding that an arbitration agreement in an employment contract permitted plaintiffs to try to certify a class in an employment discrimination dispute.

Andrew Robertson (Partner), Piper Alderman In a speech at the Chartered Institute of Arbitrators' (CIArb) Asia Pacific Conference, retiring New South Wales Chief Justice Spigelman suggested that parties should consider incorporating into their arbitration clauses the adoption of a particular law of contractual interpretation to be applied to the construction of the arbitration clause and the contract.

Abby Cohen Smutny (Partner) and Lee A. Steven (Counsel), Leah Witters (Associate), White & Case LLP The US Supreme Court will decide whether a statute that grants a right to sue in its disclosure provision, enforceable through its civil liability provision, provides a right to sue or only a right to go to arbitration.

Abby Cohen Smutny (Partner) and Lee A. Steven (Counsel), Leah Witters (Associate), White & Case LLP In response to the Supreme Court’s decision in AT&T Mobility v Concepcion (see Legal update, Supreme Court holds that Federal Arbitration Act preempts California State rule on unconscionability: full update), US Congressmen have introduced the Arbitration Fairness Act 2011, which is intended to amend the Federal Arbitration Act (FAA) to prohibit enforcement of certain mandatory pre-dispute arbitration agreements.

Abby Cohen Smutny (Partner) and Lee A. Steven (Counsel), Leah Witters (Associate), White & Case LLP The Southern District of New York has denied a motion to compel arbitration, finding that an agreement to arbitrate cannot be implied from the parties' prior course of dealing when there is no written agreement to arbitrate.

Abby Cohen Smutny (Partner) and Lee A. Steven (Counsel), Leah Witters (Associate), White & Case LLP The District Court for the Southern District of New York has refused a party's petition for the court to appoint a replacement arbitrator when the arbitration agreement was silent on replacement. The court refused because the clear intent of the parties was that each be allowed one party-appointed arbitrator.

The article, Joint venture disputes: resolving deadlock through arbitration, has been updated by Bird and Bird and re-published for PLC Arbitration and PLC Dispute Resolution subscribers. (Free access).

Eduardo Damião Gonçalves (Partner), Flávio Spaccaquerche Barbosa (Associate) and Débora Auler de Almeida Prado (Associate), Mattos Filho Advogados In a decision dated 16 February 2011, the Superior Court of Justice overruled a preliminary injunction suspending the recognition of a foreign judgment that acknowledged the validity of an arbitration clause. This was on the ground that an ongoing lawsuit in Brazil challenging the validity of the same arbitration clause is not enough to prevent the recognition and enforcement of the foreign judgment.

Abby Cohen Smutny (Partner) and Lee A. Steven (Counsel), Leah Witters (Associate), White & Case LLP The Fifth Circuit Court of Appeals has found no grounds for injunctive relief where two sophisticated commercial entities entered an investment agreement for payment of international arbitration fees that required arbitration outside the US where one entity was incorporated.

Abby Cohen Smutny (Partner) and Lee A. Steven (Counsel), Leah Witters (Associate), White & Case LLP The Second Circuit Court of Appeals has found that a class action waiver in a commercial arbitration provision cannot be enforced when plaintiffs demonstrate that the waiver precludes them from enforcing statutory rights.

Stephan Wilske (Partner) and Claudia Krapfl (Associated Partner), Gleiss Lutz The Higher Regional Court of Dresden in its decision dated 26 July 2010, just recently published, held that an arbitration agreement providing for the application of the rules of the "International Chamber of Commerce in Dresden" is to be interpreted as pointing to the Arbitration Rules of the International Chamber of Commerce (ICC) in Paris.

Abby Cohen Smutny (Partner) and Lee A. Steven (Counsel), Lauren Mandell (Associate), Leah Witters (Associate), White & Case LLP A US District Court has found that equitable estoppel requires a signatory of an arbitration agreement to base its claims on the terms of the agreement and involve the other signatory before a non-signatory can compel arbitration.

Stephan Wilske (Partner) and Claudia Krapfl (Associated Partner), Gleiss Lutz The Federal Court of Justice, the highest German court dealing with arbitration matters, ruled in a decision dated 16 December 2010, that a party can rely on the objection of lack of a valid arbitration agreement in enforcement proceedings in Germany even if it did not initiate setting aside proceedings at the seat of arbitration within the relevant time limits.

Eduardo Damião Gonçalves (partner) and Flávio Spaccaquerche Barbosa (associate), Mattos Filho, Veiga Filho, Marrey Jr. e Quiroga Advogados In a decision published on 3 December 2010, the Brazilian Superior Labour Court (TST) overruled a lower court decision recognising the UN’s immunity from jurisdiction and the arbitrability of disputes arising out of a labour contract on the ground that individual labour disputes can only be settled by the judiciary. The TST found that an arbitration clause in the contract was a breach of the constitutional right of full access to the judiciary.

Joe Kelly (Partner) and Siobhán Kirrane (Associate), A&L Goodbody In one of its first decisions under the Irish Arbitration Act 2010 (2010 Act), the Irish High Court has refused to grant an application which sought to stay High Court proceedings on the basis that a dispute was subject to an arbitration agreement. 

Eduardo Damião Gonçalves (Partner) at Mattos Filho Advogados and Flavia Foz Mange (Associate), Mattos Filho Advogados In a decision dated 2 September 2010 but only recently published, the Superior Court of Justice reaffirmed that the Brazilian Arbitration Law (Law. N. 9.306/97) applies to contracts signed before its enactment. In doing so, and applying the Geneva Protocol on Arbitration Clauses to international agreements, the Superior Court of Justice overruled a lower court decision and dismissed court proceedings based on the existence of an arbitration agreement.

Abby Cohen Smutny (Partner) and Lee A. Steven (Counsel), Lauren Mandell (Associate), Leah Witters (Associate) ,White & Case LLP The Southern District of Texas has held that a third-party defendant cannot remove an action to a federal court based on a contract with a mandatory foreign arbitration clause subject to the New York Convention. 

PD Dr. Nathalie Voser (Partner) and Anya George (Associate), Schellenberg Wittmer (Zurich) In a German-language decision dated 25 October 2010 and published on 19 November 2010, the Swiss Supreme Court dismissed a petition to set aside a judgment of the Appeals Court of Zug which held an arbitration clause to be inoperative within the meaning of Article II(3) of the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards.

An Ask the team article considering whether a judgment, obtained in breach of an arbitration clause, can be enforced in England.

New article by Angeline Welsh and Andrew Pullen, Allen & Overy LLP, in which the authors analyse the Court of Appeal's decision in Jivraj v Hashwani [2010] EWCA Civ 712 and explain the common misconceptions surrounding the case.

Andrew Robertson (Partner), Piper Alderman The New South Wales Supreme Court has refused to stay court proceedings in favour of arbitration where one of the parties to the dispute was not a party to the arbitration agreement. The court found that there was a risk of inconsistent findings and increased costs.

Abby Cohen Smutny (Partner) and Lee A. Steven (Counsel), Lauren Mandell (Associate), White & Case LLP The Ninth Circuit Court of Appeals has ruled that the court must decide the validity of an arbitration agreement (as distinguished from the validity of the contract as a whole) whenever the plaintiff raises the issue, even if the argument is not presented in the complaint.

Nicholas Peacock (Partner) and Chris Ross (Senior Associate), Herbert Smith LLP The Singapore High Court has set aside an ICC arbitral award where the tribunal acted in excess of the powers granted to it in the arbitration agreement.

Abby Cohen Smutny (Partner) and Lee A. Steven (Counsel), Lauren Mandell (Associate), White & Case LLP The Second Circuit has affirmed the dismissal of a complaint in a contract dispute on the basis of a forum selection clause referring the matter to arbitration in St. Petersburg, Russia. 

Valeria Galíndez (Partner) and Patrícia Kobayashi (Associate), Barretto Ferreira, Kujawski, Brancher and Gonçalves (BKBG) In a decision of 12 May 2010, the Court of Appeal of the State of São Paulo (TJSP) once again recognised the negative effect of arbitration agreements. In so doing, the TJSP affirmed the first instance decision which had dismissed the action filed by the claimant (Back) for the payment by the respondent (Unibanco) of certain monies for services rendered under the subject contract. The TJSP took this view, regardless of the alleged pathological character of the arbitration agreement.

Publication of a new resource on standard arbitration clauses for the AAA, ICDR, ICC and UNCITRAL.

Abby Cohen Smutny (Partner) and Lee A. Steven (Counsel), Lauren Mandell (Associate), Stephanie Early (Associate), White & Case LLP The Third Circuit has affirmed a district court ruling that the enforceability of a class action waiver in an arbitration agreement is a gateway question of arbitrability for the court to decide, not the arbitrator.

Kamal Shah (Partner) and Jonathan Morton (Trainee), Stephenson Harwood  The Supreme Court of India has held that, once an arbitration clause has been invoked, it does not negate the possibility of future use of the same clause. In its judgment dated 17 February 2010, the court held that neither the onerous financial cost of multiple arbitrations, nor the time involved, would prevent multiple actions being brought through one arbitration clause. The court went on to suggest ways to draft such a clause so as to avoid such "highly expensive and time-consuming" actions.

Andrea Ogier (Associate), Stephenson Harwood The Supreme Court of India has ruled that the absence of a signed arbitration agreement between the parties did not prevent a dispute between those parties being resolved by way of arbitration.

PD Dr. Nathalie Voser (Partner) and James Menz, J.D. (Associate), Schellenberg Wittmer (Zurich) In a decision dated 20 January 2010 and published on 10 February 2010, the Swiss Federal Tribunal rejected a petition to set aside an award by a panel of the Court of Arbitration for Sport (CAS). The petitioner had signed no relevant agreement to submit the dispute to arbitration and had specifically objected to the applicability of the dispute resolution mechanism of the sports bodies that dealt with the underlying complaint. Nevertheless, the Federal Tribunal determined that the player's conduct was sufficient to subject him to CAS jurisdiction.

Andrew Robertson (Partner), Piper Alderman The Honourable Justice Byrne, Senior Judge Administrator of the Supreme Court of Queensland, has refused an application for a stay of proceedings to allow for the domestic arbitration of a dispute despite the presence of an arbitration agreement between the parties.  His Honour held that "there is no reason to suppose that arbitration offers a better way" for resolving the dispute. While the decision in question relates to a domestic arbitration agreement which is governed by State legislation rather than Commonwealth legislation based on the Model Law, it nevertheless provides a useful insight into some of the attitudes of the Australian courts towards arbitration.

PD Dr. Nathalie Voser (Partner) and Christopher Boog (Associate), Schellenberg Wittmer (Zurich) In a recent decision dated 6 November 2009 and published on 24 December 2009, the Swiss Federal Tribunal set aside an award by the Court of Arbitration for Sport (CAS) in Lausanne. The Federal Tribunal held that, although it generally adopted a liberal approach to the validity of arbitration agreements, in the present case the mere fact that the appellant had signed an entry form for a specific tournament was not sufficient to constitute a valid arbitration agreement for disputes outside the scope of such tournament.

Alejandro López Ortiz (Senior Associate) and Silvia Martínez (Junior Associate), Lovells LLP In its Order 38/2009 of 27 January, the Court of Appeal of Madrid has considered whether a letter amounted to a waiver of an arbitration agreement.

Daniel J. Leffell (Partner), Marc Falcone (Partner) and Jeffrey D. Kleinman (Associate), Christopher P. DeNicola (Law Clerk), Paul, Weiss, Rifkind, Wharton & Garrison LLP The Colorado Supreme Court has held that a person possessing a power of attorney may lawfully sign an arbitration agreement on behalf of an incapacitated patient.  

Elena Trusova (Head of group), Goltsblat BLP The Presidium of the High Arbitration Court of the Russian Federation has given an interesting interpretation of an arbitration clause which contained a misdescription of the arbitral institution.

Daniel J. Leffell (Partner), Marc Falcone (Partner) and Jeffrey D. Kleinman (Associate), Christopher P. DeNicola (Law Clerk), Paul, Weiss, Rifkind, Wharton & Garrison LLP On 6 October 2009, the Eighth Circuit held that a credit card agreement with an arbitration clause inserted by amendment was not unconscionable. 

Daniel J. Leffell (Partner), Marc Falcone (Partner) and Jeffrey D. Kleinman (Associate), Paul, Weiss, Rifkind, Wharton & Garrison LLP The California Fourth District Court of Appeal has held that an arbitration clause in contracts between an investment company and its customers requiring a three-arbitrator panel was unconscionable and therefore unenforceable where the company failed to justify it. 

Alejandro López Ortiz (Associate) and Sonia Pérez (Associate), Lovells LLP In a decision published in June 2009, the Spanish Supreme Court ruled that breach of a choice of court clause contained in a contract may give right to damages in favour of the non-breaching party. The judgment reversed a previous ruling of the Court of Appeal of Barcelona, which rejected the claim for damages.

An update on Nurdin Jivraj v Sadruddin Hashwani [2009] EWHC 1364 (Comm), in which the court considered whether the requirement in an arbitration clause for all the arbitrators to be members of the Ismaili community was unlawful. NB that this judgment has been overturned in part on appeal, see Jivraj v Hashwani (Rev 2) [2010] EWCA Civ 712 (22 June 2010).

Ruth Byrne (Solicitor Advocate), Herbert Smith LLP In National Navigation Co v Endesa Generacion SA [2009] EWHC 196 (Comm), Gloster J held that a dispute was referable to arbitration in London notwithstanding the existence of a Spanish court decision to the contrary. The decision contains a detailed analysis of the impact of the ECJ ruling in the West Tankers case.

The National Association of Pension Funds (NAPF) and the Association of British Insurers (ABI) have indicated their concern about the introduction or maintenance of certain dispute resolution provisions in articles of association of publicly traded companies. However, the position of the NAPF and the ABI is potentially controversial, and is not necessarily substantiated when the empirical record is examined.

Publication of Practice note, Hybrid, multi-tiered and carve out dispute resolution clauses.

In Verity Shipping SA v NV Norexa & ors [2008] EWHC 213 (Comm), Teare J refused to continue an anti-suit injunction which had been granted to the claimant shipowners to restrain proceedings which had been commenced against them in the Antwerp commercial court by cargo interests. The injunction was originally granted without notice on the grounds that the Antwerp proceedings had been commenced in breach of arbitration clauses contained in bills of lading. The case is a reminder that careful thought needs to be given to the timing of any application for anti-suit relief, and the forum in which any third party indemnity claims are commenced. Here, it was the shipowners' own decision to advance indemnity claims in the Antwerp court which ultimately precluded the continuation of anti-suit injunctive relief in the English court.

As we recently highlighted (see Legal update: ICC to publish guidelines for reducing time and costs in arbitration) the ICC Commission on Arbitration has published a document entitled "Techniques for Controlling Time and Cost in Arbitration". The document, which was officially approved on 12 March 2007, was discussed and debated at an ICC UK conference on 27 March 2007, which was co-chaired by Chris Newmark (co-chair of the ICC Task Force on Arbitration) and Peter Wolrich (chair of the ICC Commission on Arbitration). The conference was attended by over 100 delegates, including barristers, solicitors, arbitrators and users of arbitration.

In Svenska v Government of Lithuania [2006] EWCA Civ 1529, the Court of Appeal interpreted a joint venture agreement (JVA) to determine whether the Lithuanian government was bound to refer disputes to ICC arbitration. Notwithstanding the deletion of an arbitration clause from an earlier draft, the Court held that there was a common intention that the government should submit disputes to arbitration, and "interpreted" the JVA accordingly. It followed that the ICC tribunal appointed pursuant to the JVA had jurisdiction to make an award against the government, and that the award was enforceable. The case is of interest because the Court of Appeal recognised that it was, effectively, rectifying the agreement under the guise of interpreting it under Lithuanian law. This highlights the differing approach to construction of an arbitration agreement which may apply where there is a foreign proper law. The judgment of the Court also contains analysis of lines of international authority on state parties to arbitration agreements and recognition of foreign awards.