Jurisdiction and Enforcement of Arbitration Agreements

1. Jurisdiction and Enforcement of Arbitration Agreements

2. New York Convention • Article II • (1) “Each Contracting State shall recognize an agreement in writing. . .” • (3) “The court of a Contracting State, when seized of an action in a matter in respect of which the parties have made an agreement within the meaning of this article, shall . . . refer the parties to arbitration unless it finds that the said agreement is null and void, inoperative or incapable of being performed.”

3. Locations of Jurisdictional Challenges • Arbitral Institution • Arbitral Tribunal • Court • Which court? • What is the effect of Article II of the New York Convention? • Pros/cons of each approach

4. Law Governing Jurisdictional Issues • Three types of law • Law governing the merits • Law governing procedure • Law governing the validity of the arbitration agreement • Each of these may be different • Identifying the third can be difficult

5. Separability • Concept of the “container contract” Substantive Contract Arbitration Clause

6. Doctrine of Separability • An arbitration clause is presumed to be independent (separate) from the substantive contract • As a result, the validity of the arbitration clause is not affected by the invalidity or termination of the underlying agreement • The effect is to preserve the arbitration agreement

7. Kompetenz-Kompetenz • Alternate spelling: compètence-compètence • Translation is “jurisdiction to decide jurisdiction” • Effect is that arbitrators have the power to rule on the existence or non-existence of their own jurisdiction • Scope varies in different countries

8. Negative Compètence-Compètence • Reverse of “standard” compètence-comptence • States that courts should generally avoid considering jurisdictional matters before the arbitrators have done so • Scope varies in different countries

9. Bases for Jurisdictional Challenges • Lack of consent to arbitration • Non-signatory • Agent not authorized • Equitable estoppel • Implied consent • Group of Companies/Veil Piercing/Alter Ego • Void arbitration clause • Defective or “pathological” arbitration clause • Dispute involves claims outside of the scope of arbitration clause • Failure of a condition precendent to clause • Dispute involves claims that are not arbitrable • Failure of form requirements (writing requirement)

10. Procedural Options for Challenging Jurisdiction • Refuse to participate in arbitral proceedings • Raise jurisdictional objection with arbitral institution • Raise jurisdictional objection with the arbitral tribunal • Raise jurisdictional objection with a national court • Defensively (opposing a motion to dismiss in favor of arbitration) • Offensively (seeking an anti-arbitration injunction) • Raise jurisdictional objection in effort to annul award at the seat • Raise jurisdictional objection in opposing recognition and enforcement of the award

11. Questions?