Tuesday Law Report: Enforcement of foreign arbitration award
2 February 1999 Minmetals Germany Gmbh v Ferco Steel Ltd Queen's Bench Division, Commercial Court (Mr Justice Colman) 20 January 1999
Tuesday 02 February 1999
An application to set aside leave to enforce two arbitration awards made under the auspices of the China International Economic and Trade Arbitration Commission of Peking (CIETAC) was refused.
A dispute had arisen out of a contract which contained a Chinese arbitration clause. In January 1998 the plaintiff obtained leave under s 101 of the Arbitration Act 1996 to enforce awards in an initial arbitration and in a resumed arbitration conducted under the auspices of CIETAC.
It was common ground that the awards were New York Convention awards, and that unless the Peking court ordered a retrial and revocation of the awards they were, as they stood, final and enforceable under Chinese law.
On the defendant's application to set aside leave to enforce the awards, the following issues, inter alia, arose: whether the defendant had been prevented from presenting its case; whether the awards had been arrived at by an arbitral procedure not in accordance with the agreement of the parties, in breach of the CIETAC rules; and whether the defendant had established that the awards had been arrived at by means which were contrary to the requirements of substantial justice contained in English law as explained in Adams v Cape Industries  1 Ch 433, so that enforcement would be contrary to public policy.
Duncan Matthews (Sinclair Roche & Temperley) for the plaintiff; Michael Swainston (Ince & Co) for the defendant.
Mr Justice Colman said that the effect of Art V of the New York Convention was that, where the tribunal was procedurally entitled to conduct its own investigation into the facts, enforcement of an award based on findings of fact derived from such investigations would be avoided if the enforcee had not been given any reasonable opportunity to present its case in relation to the results of such investigations.
That contemplated at least that the enforcee had been prevented from presenting his case by matters outside his control. In the present case, however, the enforcee had, due to matters within his control, not provided himself with the means of taking advantage of an opportunity given to him to present his case.
Article 53 of the CIETAC Rules was clearly and expressly applicable to the conduct of the arbitrators in making their award, and there was no doubt that, as regards the first award, they had not acted in accordance with "international practices and the principle of fairness and reasonableness". Nothwithstanding that, following the Peking court's order for a resumed hearing, the evidence relied on by the arbitrators at the first hearing was open to challenge, but no such challenge had been advanced. The defendant had thus, by Art 45 of the Rules, waived its right to object.
In international commerce a party who contracted into an agreement to arbitrate in a foreign jurisdiction was bound not only by the local arbitration procedure but also by the supervisory jurisdiction of the courts of the seat of the arbitration.
Where, therefore, an enforcee alleged that a New York Convention award should not be enforced because enforcement would lead to substantial injustice and would thus be contrary to English public policy, the following considerations would normally be relevant: the nature of the procedural injustice; whether the enforcee had invoked the supervisory jurisdiction of the seat of the arbitration; whether a remedy was available under that jurisdiction; whether the courts of that jurisdiction had conclusively determined the enforcee's complaint in favour of upholding the award; and, if the enforcee had failed to invoke that remedial jurisdiction, his reason for, and whether he had acted unreasonably in, failing to do so.
In the present case the enforcement of the awards would not lead to substantial injustice.
- 2 Disney heiress Abigail disowns her share of family profits in West Bank company
- 3 The secret report that helps Israel hide facts
- 4 Israel's propaganda machine is finally starting to misfire
- 5 'Hello mum, this is going to be hard for you to read ...'
Sally Farmiloe dead: Howards' Way actress, and former mistress of Jeffrey Archer, dies aged 60
Justin Bieber posts Instagram photo of Orlando Bloom crying after Ibiza fight 'over Miranda Kerr'
Sabina Altynbekova, the girl branded 'too good looking' for volleyball, says social media obsession with her is a 'bit much'
Disney heiress Abigail disowns her share of family profits in West Bank company
Australian model Robyn Lawley stages naked protest against huge coal mine seven times the size of Sydney Harbour
The secret report that helps Israel hide facts
Land for gas: Merkel and Putin discussed secret deal could end Ukraine crisis
Woman and two children killed by mob in riots over 'blasphemous' Facebook post in Pakistan
A day in the life of Vladimir Putin: The dictator in his labyrinth
Putin is 'thuggish, dishonest and reckless', says British ambassador to US
Richard Dawkins tweets: 'Date rape is bad, stranger rape is worse'
- < Previous
- Next >
£350 - £400 per annum + competitive: Orgtel: Project Manager (specializing in ...
£30000 - £34000 Per Annum 25 days holiday, Private healthcare: Clearwater Peop...
Unpaid: Cancer Research UK: If you’re a professional in project management, lo...
£85 - £140 per day: Randstad Education Cheshire: We require a teacher of Geogr...