LL202 Commercial Contracts

1. LL202 Commercial Contracts Chris von Csefalvay

2. Agenda for today • Session 4: ADR and internationalisation • ADR • Arbitration • Internationalisation of commercial law • Choice of law • Harmonisation

3. Recap • 1 thing you remember from the lecture. • 1 thing you did not understand about what was said in the lecture.

4. ADR • History • Internal governance of a contract

5. LCIA standard clause • In the event of a dispute arising out of or relating to this contract..., and if the dispute cannot be settled through negotiation, the parties shall first seek settlement of that dispute by mediation in accordance with the [...] Mediation Procedure... • If the dispute is not settled by mediation within [ ] days of the appointment of the mediator, or such further period as the parties shall agree in writing, the dispute shall be referred to and finally resolved by arbitration under the [...] Arbitration Rules.

6. LCIA standard clause • In the event of a dispute arising out of or relating to this contract..., and if the dispute cannot be settled through negotiation, the parties shall first seek settlement of that dispute by mediation in accordance with the [...] Mediation Procedure... • If the dispute is not settled by mediation within [ ] days of the appointment of the mediator, or such further period as the parties shall agree in writing, the dispute shall be referred to and finally resolved by arbitration under the [...] Arbitration Rules.

7. Judicial support of arbitration • Statutory ADR • Pre-trial ADR period • S9 Arbitration Act 1996 • Injunctions &c. brought in support of an arbitration

8. Arbitration: myth and reality • The myth: • Cheap • Competent • Flexible • Confidential

9. Arbitration: myth and reality • The myth: • Cheap <- No. • Competent <- If you can afford it. • Flexible <- Depends. • Confidential <-Yes.

10. International arbitration • Benefit: NY Convention • Enforceability worldwide (Art II(1) and (3)) • No double exequatur • Presumption of validity • No review of merits (usually...)

11. Lexarbitri/arbitral seat/location • Arbitral seat != place of arbitration • Default law • Place of setting aside • Place of enforcement • Public policy • Institutitional rules

12. Internationalisation • Primary conflicts principle: party choice • Art.3 Rome I: free choice • However, overriding mandatory provisions of the lexforicannot be ‘internationalised away’: Art.9 Rome I • Wholesale refusal of application only for reasons of ordre public: Art.21 Rome I

13. Non-state law • Art.3 Rome I: “A contract shall be governed by the law chosen by the parties.” – Do you think this includes non-state law?

14. Non-state law • Treatment by arbitral tribunals: • s46 AA: any set of rules? • Art.22 LCIA Rules: ‘rules of law which it considers appropriate’ – does that include non-state law?

15. Harmonisation and uniformisation • Uniform global commercial law? • CISG: successful • ULISA: not so much... • Cape Town Convention: brilliant – but largely ignored

16. Model laws • UNCITRAL on cross-border insolvency • UNIDROIT model franchise disclosure • INCOTERMS • UCP600 (documentary credit) • GPCL: Unidroit Principles

17. European developments • PECL • Draft Common Frame of Reference (please check the video)

18. Classroom discussion of questions • Please discuss each question in your group for five minutes. • Please present your findings.

19. End of session 3 See you tomorrow morning in the same place. – Please do the recommended readings and think about the questions.