Fifth edition of our Legal Guide on Dispute Resolution and Governing Law Clauses in India-related Commercial Contracts

Herbert Smith Freehills has published a new edition of its well-regarded guide on dispute resolution and governing law clauses in India-related commercial contracts. The Guide is intended to assist in-house counsel who handle India-related commercial contracts on behalf of non-Indian companies and who need to have a practical understanding of the nuances of drafting dispute resolution and governing law clauses in the Indian context.

To access an extract of the guide please click here. If you would like to request a copy please email asia.publications@hsf.com.

For further information, please contact Nicholas Peacock, Head of India Arbitration Practice, Alastair Henderson, Managing Partner-SE Asia, Donny Surtani, Senior Associate, or your usual Herbert Smith Freehills contact.

Nicholas Peacock
Nicholas Peacock
Partner
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+44 20 7466 2803
Alastair Henderson
Alastair Henderson
Partner
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+65 6 868 8000
Donny Surtani
Donny Surtani
Senior Associate
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+44 20 7466 2216

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Filed under Arbitration clauses, India, News

NSW Supreme Court refuses indemnity costs on successful application for referral to arbitration

Justice Hammerschlag of the New South Wales Supreme Court (the Court) has refused to award indemnity costs to parties which successfully obtained a stay of proceedings in favour of arbitration: John Holland Pty Ltd v Kellogg Brown & Root Pty Ltd (No 2) [2015] NSWSC 565. 

The decision was made in the context of a domestic arbitration regulated by the Commercial Arbitration Act 2010 (NSW), although, as his Honour noted in the course of the judgment [t]he International Arbitration Act and the suite of State and Territory Commercial Arbitration Acts enacted since 2010 are generally intended to give effect to the UNCITRAL Model Law on International Commercial Arbitration.  Good policy suggests that absent clear legislative intent to the contrary, construing them so as to result in incongruent outcomes should be avoided. 

In rejecting the application for indemnity costs, the Court declined to follow the approach taken in other regional jurisdictions.

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Filed under Australia, Costs

The LCIA provides guidance notes to the LCIA Rules 2014 – the pertinent points

On 29 June 2015, the London Court of International Arbitration (“LCIA“) published guidance notes designed to facilitate the “diligent and timely conduct of arbitrations” under the LCIA Rules 2014 (the “Rules“). There are three separate notes: (i) for the parties to the proceedings; (ii) for arbitrators; and (iii) focussing on emergency procedures. A good example of the LCIA’s user-friendly approach to arbitration, the notes provide helpful advice which allows both arbitrators and parties to assist the LCIA Secretariat in ensuring arbitrations run smoothly. They provide a fascinating insight into the operation and approach of the LCIA to a number of important issues. It is likely that the notes will be referred to frequently in proceedings.

Below is a brief comment on each of the three notes; summarising the purpose and highlighting areas of particular interest.

To read the notes in full, please click here. Herbert Smith Freehills has produced a Step by Step Guide to Arbitration under the LCIA Rules 2014. To request a copy, please contact Arbitration.Info@hsf.com.

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Filed under Arbitration rules

First enforcement of an Emergency arbitrator award against a state in investment treaty case

It has been announced in Global Arbitration Review that Ukraine has been the first state to have an emergency arbitrator award enforced against it (albeit that enforcement is currently stayed pending appeal). The Pechersk District Court in Kiev upheld an application by London-listed JKX Oil & Gas and two subsidiaries to enforce a Stockholm Chamber of Commerce award issued in January under the SCC’s 2010 Rules emergency arbitrator procedure.

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Filed under Awards

English High Court considers the proper construction of an arbitration clause to determine whether the ICC has jurisdiction to arbitrate the dispute

In Hashwani v OMV Maurice Energy Ltd [2015] EWHC 1811 (Comm), the English High Court (the Court) dismissed an application by reference to section 72 of the English Arbitration Act 1996 (the Act) challenging the jurisdiction of the International Chamber of Commerce (ICC) to arbitrate the dispute.

The Court considered two arbitration provisions contained within two transaction documents, the Joint Operating Agreement and the Farmout Agreement (both defined further below). The Joint Operating Agreement, on its face, appeared to only apply to two of the parties to the arbitration that was the subject of the reference. The Court held that the ICC arbitration provision in this Agreement was valid and binding on two of the parties and that, in spite of an inconsistent arbitration provision contained in the Farmout Agreement which was subsequently entered into between all three parties to the dispute providing for domestic arbitration, such provision did not oust the former nor render it invalid. The Court then proceeded to take a purposive approach to the arbitration provision in the Joint Operating Agreement, looking at the intention of the parties. The Court expressed the view that the Joint Operating Agreement clearly contemplated that there would be further parties to the Agreement in future and, as such, the arbitration provision should be construed to allow the resolution of disputes between all such future parties. If such an approach were followed, the third party to the dispute would therefore also have been bound by that provision.

However, the Court did not reach a ruling on this point, stating that when a court cannot be sure of jurisdiction but there would in any event be an arbitration between closely-related parties as to the same matters in issue, the sensible course would be to leave the question of jurisdiction in relation to the claim to be finally decided by the arbitrators in question.

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Filed under Arbitration Act 1996, Arbitration clauses, Europe, Jurisdiction

Singapore Court of Appeal decision on the enforceability of “Interim Awards”

In the case of PT Perusahaan Gas Negara (Persero) TBK v CRW Joint Operation (Indonesia), the Singapore Court of Appeal (the Court) considered the issue of enforceability of interim awards. The background to the case is more fully explained in our blog post, but in short the Contractor (CRW) had referred a number of contractual variation claims against the Employer (PGN) to a dispute adjudication board (DAB), and sought to enforce the DAB’s decision to promptly pay the adjudicated sum by way of an arbitration. The majority of the arbitral tribunal issued an interim award which CRW sought to enforce in Singapore in the manner of a judgment.

The majority of the Court found that an interim award which disposed of a preliminary issue was enforceable, in contrast to a provisional award, which was issued only to protect a party from damage during the course of an arbitration (which award was not capable of being enforced). The Interim Award made a final decision on PGN’s obligation to pay promptly to CRW the sums indicated in the DAB’s decision.

The Court’s decision is helpful in looking beyond terminology to the characterization of the types of tribunal decision which are enforceable and those which, despite being couched in the nomenclature associated with enforceability, are not enforceable. There is also considerable guidance given on the interpretation of the dispute resolution provisions in the FIDIC form of contracts which is discussed in more detail in our Construction Ebulletin.

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Filed under Asia, South East Asia

The changing landscape of Investment Treaty arbitration – Herbert Smith Freehills comments on recent developments and the future of investment arbitration

As the US Senate is poised to pass legislation granting President Obama the trade promotion authority which will facilitate the passing of the Trans-Pacific Partnership Agreement (TPP), the future of the most controversial parts of the TPP and many other recent trade agreements – investment protection and investor-state dispute settlement (or ISDS) – remains uncertain.

In our 23 June 2015 webinar, “The changing landscape of Investment Treaty arbitration”, four of our Investment Treaty arbitration specialists looked at the ongoing debate surrounding investment protection and ISDS, focusing on the TTIP and TPP and the current approaches being adopted in their negotiation. They considered what the future looks like for ISDS if these two treaties form a “blueprint” for the future of investment protection. The webinar also provides an update on recent developments in the sphere of investment arbitration, including the EU’s developing position on Intra-EU claims, provisional measures, arbitrator challenges and the annulment process.

To access a recording of this webinar, please contact Jane Webber.

Speakers:

Isabelle Michou, Partner, International Arbitration, Paris (Chair)

Christian Leathley, Partner, International Arbitration, London

Andrew Cannon, Partner, International Arbitration, Paris

Iain Maxwell, Of Counsel, International Arbitration, London

Isabelle Michou
Isabelle Michou
Partner
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+33 1 53 57 74 04
Christian Leathley
Christian Leathley
Partner
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+44 20 7466 2532
Andrew Cannon
Andrew Cannon
Partner
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+44 20 7466 2852
Iain Maxwell
Iain Maxwell
Of Counsel
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Filed under Investment Arbitration, News

Corporations Act ‘matters’ and the scope of a ‘pathological’ arbitration agreement: Robotunits Pty Ltd v Mennel [2015] VSC 268

Justice Croft of the Victorian Supreme Court handed down judgment on 22 June 2015 in an application for a stay of proceedings and referral to arbitration pursuant to the International Arbitration Act 1974 (Cth) (IAA). Continue reading

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Filed under Arbitration laws, Australia, Stays

Upcoming webinar: The changing landscape of Investment Treaty arbitration – Tuesday 23 June 2015 – 12.45pm BST

There has never been a time of greater public engagement in the whole system of Investment Treaties and the Investor State Dispute Settlement (ISDS) provisions contained within them. The ongoing negotiation of both the Trans-Pacific Partnership and the Transatlantic Trade and Investment Partnership has provoked very heated legal and political debate from both sides of the globe. Yet, while the debate rages over the provisions contained within these treaties, arbitral tribunals continue to produce arbitral awards which raise interesting new issues in this ever developing area of international law.

In this webinar, four of our Investment Treaty arbitration specialists will look at the ongoing debate surrounding investment protection and ISDS, focusing on the TTIP and TPP and the current approaches being adopted in their negotiation. They will consider what the future looks like for ISDS if these two treaties form a “blueprint” for the future of investment protection. They will also provide an update on recent developments in the sphere of investment arbitration, including the EU’s developing position on Intra-EU claims, provisional measures, arbitrator challenges and the annulment process.

Speakers:

Isabelle Michou, Partner, International Arbitration, Paris (Chair)

Christian Leathley, Partner, International Arbitration, London

Andrew Cannon, Partner, International Arbitration, Paris

Iain Maxwell, Of Counsel, International Arbitration, London

 

If you would like to register for this event please contact Jane Webber.

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Filed under EU Law, Investment Arbitration, Public International Law, Uncategorized

Madrid court sets aside awards on grounds of public order after reviewing merits

Under the Spanish Arbitration Law,[1] an arbitral award is final and binding and can only be challenged on six specific grounds, including that the award is contrary to public order.[2] Up until now, when considering challenges to arbitral awards, Spanish courts have held that an award cannot be appealed or reviewed on its merits[3] and that it is not the role of the Spanish courts to correct hypothetical deficiencies in the merits (fact and law) of the award. The concept of “public order” has also been very narrowly interpreted, requiring a violation of a fundamental constitutional right or, more recently, a breach of competition and antitrust principles as required under European Union law.[4]

Three recent decisions of the Tribunal Superior de la Justicia, Madrid (the “Court“)[5][6] have apparently changed, or at least cast doubt, on this past approach. In all three cases, the Court has set aside arbitral awards after reviewing the merits of the decision taken by the relevant arbitral tribunals and finding the incorrect application of the law to be contrary to Spanish public order[7]. In so doing, the Court has arguably exceeded the scope of its formal functions of the judicial supervision of arbitration, adopting a new and extended definition of public order as a basis for setting aside the award.

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Filed under Awards, EU Law, Europe