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Judicial Recourse Against the Arbitral Award: A Comparative Synthesis

Published online by Cambridge University Press:  21 May 2009

D. Kokkini-Iatridou
Affiliation:
Professor of Conflict of Laws and Comparative Law, Utrecht University.
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Extract

‘S'il est un problème irritant, c'est Men celui des voies de recours en matière d' arbitrage’. These are the opening words of R. Perrot's magnificent report from 1980 on ‘Les voies de recours en mati`re d'arbitrage’. He continues with the observation that the expansion, diversity and fragmentation of the ever-increasing number of means of recourse lead to post-arbitral disputes which negate all of the positive aspects of arbitration. This all works to the advantage of the losing party who can use this maze of recourses to vent his dissatisfaction. These remarks refer to the French legislation on arbitration which was in force at that time. Moreover, a similarly pessimistic view can be found in a comparative study by P. Schlosser on the setting aside of arbitral awards published in the same year.

Type
Research Article
Copyright
Copyright © T.M.C. Asser Press 1991

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References

** I would like to express my appreciation to J.A. Freedberg, head of the Department of International Commercial Arbitration of the T.M.C. Asser Instituut, for preparing the English translation of this contribution.

1. Rev. arb. (1980) p. 268.

2. ‘L'arbitrage et les voies de recours’, Rev. arb. (1980) pp. 286309.Google Scholar

3. The provisions on arbitration are codified as follows—Austria: ss. 577–599 ZPO; Belgium: Arts. 1676–1723 JC; Germany:ss. 1025–1048 ZPO; France: Arts. 1442–1507 NCCP; Greece: Arts. 867–903, 905(1) and 1906 CCP; The Netherlands: Arts. 1020–1076 COP; Portugal: Law no. 31/1986 on Voluntary Arbitration; Spain: Law no. 36/1988 on Arbitration and Switzerland: Arts. 1–46 Intercantonal Arbitration Convention (Concordat) and Arts. 176–194 Federal Private International Law Act (PILA).

4. These countries, nonetheless, have enacted certain provisions aimed at international arbitration, but there is no consistent partem as to their number or subject-matter.

5. France and Switzerland employ the dualistic system. In both Switzerland (Art 176(2) PILA) and France (Art 1495 NCCP), the sections regulating international arbitration may be excluded by die parties.

6. The reason for this, or at least the principal reason, is that both countries for many years were subject to a dictatorial government that isolated mem from the international arbitration community. See Kokkini-Iatridou, D., ‘Twee recente arbitrageregelingen: Portugal en Spanje’Google Scholar [Two recent statutes on arbitration: Portugal and Spain], in Kokkini-Iatridou, D. and Grosheide, F.W., eds., Molengrafica Eenvormig en ver gelijkend privaatrecht 1990 [Uniform and comparative private law], (1990) pp. 357358Google Scholar, including references to literature.

7. The former law on arbitration (pre-1 December 1986) allowed appeal on the merits to the courts. According to P. Sanders, in practice, parties only made sporadic use of this possibility; see Het nieuwe arbitragerecht [The new law on arbitration], 2nd edn. (1991) p. 275.Google Scholar

Art III(2) of the transitional law provisions reads:

‘Cases in which, before the date on which this Act enters into force, an appeal to a court was reserved, shall continue to be governed by articles 646 and 647 of the Code of Civil Procedure as in force before mat date, provided mat upon the expiry of a period of five years after that date me reservation of appeal shall be extinct’ (Emphasis added.)

Appeal was only totally abolished on 1 December 1991.

8. See infra, section 3.

9. Art 1481 NCCP. For the provisions regulating appeal, see, in particular, Arts. 1482, 1483, 1485 and 1486 NCCP.

10. Art 1495 NCCP. Title TV that regulates the means of recourse for domestic: arbitration does not apply for international arbitrations.

11. See, e.g., Court of Paris 12 December 1989. D. (1990), 3e Cahier-Jurisprudence, p. 9Google Scholar; and Rev. arb. (1990) p. 863, with a note by P. Level.

12. The definition given in Art 32 of the Portuguese Law no. 31/1986 arbitration legislation is based on the definition given in Art 1492 of the French NCCP. According to this definition, arbitration is international if it implicates international commercial interests. For more details see Vicente, D. Moura, ‘L'evolution récente du droit de l'arbitrage au Portugal’, Rev. arb. (1991) pp. 419445.Google Scholar

13. For the provisions regulating appeal, see Arts. 27(3), 29 and 34, Law no. 31/1986.

14. See, concerning this provision, in particular, Storme, M. and Demeulenaere, B., International arbitration in Belgium (1989) pp. 83, 8890Google Scholar and the references to literature contained therein and De Ly, F., ‘Internationale arbitrage in Belgi¨’ [International arbitration in Belgium], TvA (1989) pp. 135142Google Scholar, and the extensive references to literature contained therein. See also, De Ly, F., ‘The Place of Arbitration in the Conflict of Laws of International Commercial Arbitration: An Exercise in Arbitration Planning’, 12 Nw. J. Int. L. & Bus., no. 1, pp. 72 and 73Google Scholar. The author cites, besides Belgian and Swiss arbitration law, a decision of the Supreme Court of Sweden dated 18 April 1989 which also recognized the validity of exclusion agreements between non-Swedish parties.

15. In several countries, this ground cannot lead to the setting aside of the award if the parry relying on it took part in me arbitral proceedings without raising an objection to the composition of the arbitral tribunal. See, e.g., Belgium (Art 1704(4) CJ); The Netherlands (Art 1065(3) CCP) and Portugal (Art 27(2) Law no. 31/1986).

16. Belgium (Art 1704(2)(j) CJ); Greece (Art 897(7) CCP) and Switzerland (Art 36(h) Concordat).

17. Belgium (Art. 1704(2)(i) CJ); The Netherlands (Art 1065(1)(d)); Portugal (Art 27(1)(d) Law no. 31/1986); Greece (Art 897(5) CCP) where the parties may agree mat the arbitral award shall not contain reasons (Art. 892(2) CCP), thus setting aside will only be possible if the parties have not made use of this possibility; and Germany (s. 1041(1)(5) ZPO) where the award cannot be set aside if the parties agreed mat the award should not contain reasons.

18. Under the Concordat, parties may agree that the award shall not contain reasons (Art 33(e)); see Poudret, J.-F. in Lalive, P. et al. , Le droit de l'arbitrage interne et international en Suisse (1989) p. 216.Google Scholar

19. See, respectively, s. 595(1)(7) ZPO; Art 1704(3) CJ; Art. 897(8) CCP and s. 1041(1)(6) ZPO.

20. For more details concerning the question of time-limits for applying to set aside the award, see Samuel, A., ed, Jurisdiction Problems in International Commercial Arbitration: A Study of Belgian, Dutch, English, French, Swedish, Swiss, U.S. and West German Law (1989) pp. 262276.Google Scholar

21. See, respectively, s. 596(3) ZPO; Art. 1707(3) CJ, s. 1043(2) ZPO and Art. 897(8) in conjunction with Art. 545(5) CCP.

22. Not included in this comparison are the courts which might have jurisdiction over an application to set aside an award made in response to a request for enforcement of die award.

23. In the Netherlands, Belgium and Portugal, appeal and cassation are possible from a decision in setting aside proceedings. In Greece and France, cassation is possible. In Austria and Germany, the normal means of recourse are available. In Spain, there is no recourse against the decision of the Audiencia Provincial. The Swiss PILA offers the parties the choice of two fora; if it is the cantonal court that is to decide, mis decision is d´finitief (Art 191(2) PILA). Under the Concordat, the decision of the cantonal court can be challenged by a public law appeal for violation of certain provisions of the Concordat. According to J.-F. Poudret, the federal recours en nullité is also available for violation of the federal provisions on jurisdiction that are applicable to arbitration; see this author in Lalive, et al. , op. cit n. 18, pp. 205206.Google Scholar

24. See, respectively, Art 582 CCP (court of first instance); Art 1717 (1, 2 and 3) CCP (court of first instance) and s. 1046 in conjunction with s. 1045(1) ZPO (Amtsgericht or Landgerichf).

25. In eight of the countries studied, die partial setting aside of an award is possible either as provided by law or as established in case law. I have not been able to determine precisely if partial setting aside is possible in Portugal.

26. See, e.g., Beck' sche kurz Kommentare, vol. 1 (1989) p. 2158.Google Scholar

27. Huys, M. and Keutgen, G., L'arbitrage en droit belge et international (1981) p. 369.Google Scholar

28. See, e.g., Fouchard, Ph., ‘L'arbitrage international en France après le décret du 12 mai 1981’, JDI (1982) p. 412Google Scholar; Robert, J. and Moreau, B., Guide Judicaire Dalloz, loose-leaf, p. 46–3Google Scholar. See also Court of Appeal Paris 8 January 1982, Rev. arb. (1982) p. 62.

29. See, on this topic, Kokkini-Iatridou, D., ‘Enkele aspecten van het Griekse arbitragerecht in rechtsvergelijkend perspectief’Google Scholar [Some aspects of Greek arbitration law as seen from a comparative perspective], in Kokkini-Iatridou, D. and Grosheide, F.W., eds., op. cit. n. 6, p. 457.Google Scholar

30. For details, see Poudret, , op. cit. n. 18Google Scholar under Art. 40(4) Concordat and Art 191(1) PILA.

31. See Exposicâo de motivos, Diário da Assembleia da Republica [Explanatory Report, Journal of the Assembly of the Republic], II Series (2 07 1986) ss. 15, p. 3199.Google Scholar

32. See Boletin Official del Estado [Official State Bulletin] (6 and 7 12 1988) p. 5766Google Scholar, first column.

33. See. Kerameus, K.D., ‘Einschränkungen der Klage auf Aufhebung von Schiedssprüchen’, in Festschrift für Hans W. Fasching zum 65. Geburtstag (1988) pp. 266268Google Scholar, with references to court decisions.

34. See Storme, and Demeulenaere, , op. cit. n. 14, pp. 8384Google Scholar, with extensive references to literature and court decisions.

35. See, e.g., the decision of 12 February 1989, Rev. arb. (1989) p. 713.

36. According to Poudret (with reference to A. Bucher) Art. 192 PILA entails ‘la renonciation anticip´e au recours’; after the award has been made, parties may waive the setting aside of the award even if the requirements of Art 192(2) PILA are not fulfilled. See, this author in Lalive, et al. , op. cit. n. 18, p. 449.Google Scholar

37. Ibid.

38. In the earlier arbitration legislation in the Netherlands (pre-1 December 1986) the grounds for revocation were included among the grounds for setting aside.

39. Sanders, , op. cit. n. 7, p. 244.Google Scholar

40. Arts. 1495 and 1507 NCCP.

41. See, e.g., Bellet, P. and Mezger, E., ‘L'arbitrage international dans le nouveau code de procédure civile’, Rev.crit.dr.int.priv. (1986) p. 654.Google Scholar

42. See, e.g., Fouchard, , loc. cit. n. 28, p. 413.Google Scholar

43. See his Note under Cour de cassation Civ. ler, 8 03 1988Google Scholar, D. (1989), 41e Cahier-Jurisprudence, p. 579.Google Scholar

44. Bucher, A., Le nouvel arbitrage international en Suisse (1988) p. 133.Google Scholar

45. See Lalive, P., ‘The New Swiss Law on International Arbitration’, Arb. Int'l (1988) p. 16, ftn. 44Google Scholar; Poudret, J.-F., ‘Les voies de recours en matière d'arbitrage international en Suisse selon le Concordat et la nouvelle loi fédérale’, Rev. arb. (1988) p. 615Google Scholar; the same author in Lalive, et al. , op. cit n. 18, pp. 443444Google Scholar; Habscheid, J., ‘Das neue schweizerische Recht der internationalen Schiedsgerichtsbarkeit nach dem Bundesgesetz über das Internationale Privatrecht’, RIW/AWD (1988) p. 772.Google Scholar

46. See Santos, A. Marques Dos, ‘Nota sobre a nova lei portuguesa relativa à arbitragem voluntária’ [Note on the new Portuguese arbitration statute concerning voluntary arbitration], Rev. CEA (1987) pp. 4546Google Scholar, with references to literature.

47. Authors from the countries studied claim mat revocation occurs rarely, if ever, in practice.

48. See Poudret, in Lalive, et al. , op. cit n. 18, p. 234.Google Scholar

49. In France and in the Netherlands, cassation is possible against the decision in revision proceedings; in Switzerland, die public law appeal to ttw Federal Supreme Court is possible on the ground of violation of the Concordat or of Art 4 of die Constitution. In Spain, there is no means of recourse available against die decision of the court regarding revocation (Art. 1810 of the Ley de Enjuiciamento Civil).

50. Partial setting aside of the award as a result of revocation is specifically provided for the legislation of France, The Netherlands and Spain. The Swiss Concordat does not regulate mis question. A number of authors take the position that such partial setting aside is possible. See Poudret, in Lalive, et al. , op. cit. a 18, p. 240Google Scholar with references to literature including authors with differing opinions.

51. As expressed by Snijders, H J. in van den Berg, A.J. et al. , Het Arbitragerecht [The arbitration law] (1988) p. 128Google Scholar. See Art. 1068(2) and (3) in conjunction with Art. 394(1) CCP.

52. Art. 34 concerns the encumbered rights of third parties which have been acquired in good faith.

53. Bellet, and Mezger, , loc. cit n. 41, p. 654Google Scholar write mat the appeal ‘est un fossile hérit´ de l'ancien droit qui est resté par inadvertance dans le d´cret du 12 mai 1980’.

54. See Kokkini-Iatridou, D., op. cit n. 6, p. 408.Google Scholar

55. E.g., Sanders, (op. cit n. 7, p. 232)Google Scholar wrote regarding the new arbitration legislation of die Netherlands as follows:

‘The legislator expects that thanks to the introduction of the possibility of a supplementary award, setting aside proceedings due to die arbitrators' “omission” will be limited and may even become a thing of the past.’

56. Concerning die former French arbitration legislation, see, e.g., the report by Perrot, , loc. cit n 1Google Scholar and Fouchard, , loc. cit. n. 28, pp. 408409 and 411.Google Scholar

57. In Spain, cassation was possible on certain grounds. Cassation because of violation of die law involved a review of the law applied.

58. The Spanish arbitration law of 1988 is based on the Iberian-American Model Law on Arbitration; see Cremades, B., ‘L'Espagne étrenne une nouvelle loi sur l'arbitrage’, Rev. arb. (1986) pp. 191192Google Scholar. See on this Model Law, Kokkini-Iatridou, D. and Vecido, I. Benavent, ‘De Iberisch-Amerikaanse Modelwet inzake de arbitrage als harmonisatie-instrument’Google Scholar [The Iberian-American Model Law on arbitration as an instrument of harmonization], in Kokkini-Iatridou, D. and Grosheide, F.W., eds., Molengrafica. Eenvormig en vergelijkend privaatrecht 1991 (1991) pp. 3770.Google Scholar

59. In Germany, the support for the adoption of die Model Law is limited to international arbitration. See the 1989 publication of the German Arbitration Institute entitled Übernahme des UNCITRAL Modellgesetzes über die intemationale Handelsschiedsgerichtsbarkeit in das deutsche Recht [The Adoption into German law of die UNCITRAL Model Law on International Commercial Arbitration] (1989). The text of the draft law is included in tins booklet on pp. 45–63.

60. See also, Gaillard, E., ‘The UNCITRAL Model Law and Recent Statutes on International Arbitration in Europe and Norm America’, 2 ICSID Rev.-FILJ (1987) p. 426.Google Scholar