International Commercial Arbitration

1. International Commercial Arbitration Lec2: Arbitration Agreement

2. Readings • Zhao, Xiu-wen, • International Commercial Arbitration Law, 2004, • Chapter 3 • Redfern & Hunter, • Law & Practice of International Commercial Arbitration, 2005, • Chapter 3

3. Definition of Arbitration • Existence of Dispute • What is dispute? • Hayter v. Nelson (1990) • Existed dispute • Future dispute • Consensus on Reference of Dispute to a Third Person • Binding Decision to Be Given

4. Forms of Arbitration • Ad hoc Arbitration • Submission of a dispute to an arbitral tribunal formed for this special case by selected arbitrator(s) under the rules selected by the parties • Institutional Arbitration • Submission of a dispute to an institution administrating arbitration; case to be decided by a tribunal formed for this special case under the rules of the institution as a default choice or rules selected by the parties; arbitrators to selected by the parties or by the institution where no selection made by the parties

5. Definition of “Agreement” • NY Convention: • Each Contracting State shall recognize an agreement in writing under which the parties undertake to submit to arbitration all or any differences which have arisen or which may arise between them in respect of a defined legal relationship, whether contractual or not, concerning a subject matter capable of settlement by arbitration.

6. Forms of Arbitration Agreement • Arbitration Clause • A clause set in the Contract • All disputes arising out of or in connection of this contract shall be submitted to CIETAC for arbitration in accordance with its Arbitration Rules for a final and binding decision. • Arbitration Agreement • An agreement materially separated from but in relation to the Contract

7. Forms of Arbitration Agreement • Agreement in Writing • Zambia Steel & Building Supplies Ltd v James Clark & Eaton Ltd [1986] • It was a dispute arising out from an oral contract. However, a written draft of the contract, within which there was an arbitration clause, was sent to the buyer during the negotiation. No objection from the buyer has ever been made. Both parties performed their obligations under the oral contract before a dispute occurred. The buyer sued the seller in a court, saying that there was no arbitration agreement in writing…

8. Forms of Arbitration Agreement • Agreement in Writing • 圣.玛赛尔航运有限公司、圣.罗哲斯行运有限公司申请承认和执行伦敦临时仲裁裁决请示案 • 申请执行人向被申请执行人定购船舶若干艘，签订书面合同，合同规定伦敦LMAA仲裁。合同同时规定前者选择权，即在一定时期内，有权以与该合同相同条件定购另一艘船舶。选择权行使后未另行签订合同。后就该选择权下船舶质量产生争议，LMAA作出有利于前者的裁决。后者主张不存在仲裁协议，要求拒绝承认执行。

9. Forms of Arbitration Agreement • Agreement in Writing • 《中华人民共和国仲裁法》 • 第十六条　仲裁协议包括合同中订立的仲裁条款和以其他书面方式在纠纷发生前或者纠纷发生后达成的请求仲裁的协议。

10. Forms of Arbitration Agreement • Agreement in Writing • 《最高人民法院关于适用〈中华人民共和国仲裁法〉若干问题的解释》: • 第一条　仲裁法第十六条规定的“其他书面形式”的仲裁协议，包括以合同书、信件和数据电文（包括电报、电传、传真、电子数据交换和电子邮件）等形式达成的请求仲裁的协议。

11. Contents of Arbitration Agreement • Dispute, Consent, Submission • Clause giving a choice • William Co v Chu Kong Agency Co Ltd & Anor [1993] • A B/L contained a clause saying all disputes under the B/L shall be resolved by arbitration or litigation in PRC in accordance with Chinese law. The plaintiff brought a claim against the defendant in the High Court of HK. The defendant then request a stay…

12. Contents of Arbitration Agreement • Dispute, Consent, Submission • Clause giving a choice • 《最高人民法院关于适用〈中华人民共和国仲裁法〉若干问题的解释》: • 第七条　当事人约定争议可以向仲裁机构申请仲裁也可以向人民法院起诉的，仲裁协议无效。

13. Defective Arbitration Agreement • 详见杨良宜、莫世杰、杨大明著：《仲裁法——从1996年英国仲裁法到国际商务仲裁》，第一章，2 • 合约解释规则 （Rules of Construction） • 合理性原则 • 完整性原则 • 符合合约目的原则 • 特别条款或附加条款优于一般条款原则 • 修订条款优于原始条款原则 • 不应使违约方从中不当获利原则

14. Defective Arbitration Agreement • Arbitration Agreement without “Arbitration” • David Wilson Homes Ltd v Survey Services Ltd 7 David Jonathan Marshall (2001) • “Any dispute or difference arising hereunder between the Assured and the Insurers shall be referred to a Queen’s Counsel of the English Bar to be mutually agreed between the Insurers and the Assured or in the event of disagreement by the Chairman of the Bar Counsel.”

15. Defective Arbitration Agreement • Uncertainty in Appointment of Arbitrator(s) • Downing v Al Tameer Establishment (2002) • “In case the difference cannot be settled through mutual consultation, the matter shall be submitted for arbitration by three arbitrators to be appointed by each of the parties hereto whose award shall be final and binding.”

16. Defective Arbitration Agreement • Choosing Both Arbitration and Court Proceedings • “Arbitration in Hong Kong before the Court.”

17. Defective Arbitration Agreement • Choosing Both Arbitration and Court Proceedings • Smith Ltd v H & S International [1991] • “13. Settlement of Dispute: If any dispute or difference shall arise between the parties hereto concerning the construction of this Agreement or the rights or liabilities of either party hereunder the parties shall strive to settle the same amicable but if they are unable to do so the dispute or difference shall be adjudicated upon under the Rules of Conciliation and Arbitration of he ICC by one or more Arbitrators appointed in accordance with those Rules.” • “14. Language and Law: This Agreement is written in English and shall be interpreted according to English law. The Court of England shall have exclusive jurisdictions over it to which jurisdiction the parties hereby submit.”

18. Defective Arbitration Agreement • Choosing Both Arbitration and Court Proceedings • The “Nerano” (1994) • A written clause in the B/L reads: • “The conditions as per relevant charterparty dated 02.07.1990 are incorporated in this bill of lading and have precedence if there is a conflict, English law and jurisdiction applies.” • A printed clause in the B/L reads: • “All terms and conditions liberties exceptions and arbitration clause of the Charterparty, dated as overleaf, are herewith incorporated.”

19. Defective Arbitration Agreement • Conflict between Section Title and Section Contents • Cott UK Ltd v F E Barber Ltd [1997] • “Arbitration • Any dispute or difference arising from the construction or performance of the agreement shall be referred to the decision of a person to be appointed by the Director General of the British Soft Drinks Association. The person chosen or appointed shall be an independent consultant and shall act as an expert and not as an arbiter and his decision shall be final and binding on the parties.”

20. Defective Arbitration Agreement • Two Seats, One Arbitration • Lovelock Ltd v Exportles [1968] • “Any dispute shall be submitted to arbitration in London; any other dispute shall be arbitrated in Moscow.”

21. Defective Arbitration Agreement • Floating Arbitration Agreement • The “Star Texas” [1993] • “Any dispute arising under the charter to be referred to arbitration in Beijing or London in defendant's option.”

22. Defective Arbitration Agreement • Non-Existence of the Arbitral Institution Selected • Lucky-Goldstar International v Ng Moo Kee Engineering Limited [1993] • “Claims: Any dispute or difference arising out of or relating to this contract, or the breach thereof which cannot be settled amicably without under delay by the interested parties shall be arbitrated in the 3RD COUNTRY, under the rule of the 3RD COUNTRY and in accordance with the rules of procedure of the International Commercial Arbitration Association. The award shall be final and binding upon both parties.”

23. Defective Arbitration Agreement • 《最高人民法院关于适用<中华人民共和国仲裁法>若干问题的解释》： • 第三条　 仲裁协议约定的仲裁机构名称不准确，但能够确定具体的仲裁机构的，应当认定选定了仲裁机构。第四条　 仲裁协议仅约定纠纷适用的仲裁规则的，视为未约定仲裁机构，但当事人达成补充协议或者按照约定的仲裁规则能够确定仲裁机构的除外。

24. Defective Arbitration Agreement • 《最高人民法院关于适用<中华人民共和国仲裁法>若干问题的解释》： • 第五条　 仲裁协议约定两个以上仲裁机构的，当事人可以协议选择其中的一个仲裁机构申请仲裁；当事人不能就仲裁机构选择达成一致的，仲裁协议无效。第六条　 仲裁协议约定由某地的仲裁机构仲裁且该地仅有一个仲裁机构的，该仲裁机构视为约定的仲裁机构。该地有两个以上仲裁机构的，当事人可以协议选择其中的一个仲裁机构申请仲裁；当事人不能就仲裁机构选择达成一致的，仲裁协议无效。

25. Arbitrability • Subjective Arbitrability • Art. 2060 of the New Code of Civil Procedure (France) provides: • “(D)ispute concerning public collectivities and public establishments” cannot be referred to arbitration.

26. Arbitrability • Objective Arbitrability • Art. 2060 of the New Code of Civil Procedure (France) provides: • “(o)ne may not submit to arbitration questions of personal status and capacity, or those relating to divorce or to judicial separation or disputes …. and more generally in all areas which concern public policy.”

27. Separability • Autonomy of Arbitration Agreement • The status of the main contract does not necessarily affect the arbitration agreement. • Heyman v. Darwins Ltd (1942)

28. 《中华人民共和国仲裁法》： • 第十九条　仲裁协议独立存在，合同的变更、解除、终止或者无效，不影响仲裁协议的效力。 • 《最高人民法院关于适用<中华人民共和国仲裁法>若干问题的解释》： • 第十条　 合同成立后未生效或者被撤销的，仲裁协议效力的认定适用仲裁法第十九条第一款的规定。当事人在订立合同时就争议达成仲裁协议的，合同未成立不影响仲裁协议的效力。

29. Separability • Autonomy of Arbitration Agreement • The arbitration agreement may be governed by a law different from the governing law of the main contract. • 《最高人民法院关于适用<中华人民共和国仲裁法>若干问题的解释》： • 第十六条　 对涉外仲裁协议的效力审查，适用当事人约定的法律；当事人没有约定适用的法律但约定了仲裁地的，适用仲裁地法律；没有约定适用的法律也没有约定仲裁地或者仲裁地约定不明的，适用法院地法律。

30. Non-Signatory Party to Arbitration Agreement • Incorporation by Reference • Assumption • Agency • Am. Bureau of Shipping v Tencara Shipyard S.P.A. (1999) • Veil-Piecing • Carte Blanche (Singapore) Pte., Ltd. v Diners Club Int'l, Inc. (1993) • Estoppel

31. Non-Signatory Party to Arbitration Agreement • 《最高人民法院关于适用<中华人民共和国仲裁法>若干问题的解释》： • 第八条　 当事人订立仲裁协议后合并、分立的，仲裁协议对其权利义务的继受人有效。当事人订立仲裁协议后死亡的，仲裁协议对承继其仲裁事项中的权利义务的继承人有效。前两款规定情形，当事人订立仲裁协议时另有约定的除外。

32. Non-Signatory Party to Arbitration Agreement • 《最高人民法院关于适用<中华人民共和国仲裁法>若干问题的解释》： • 第九条　 债权债务全部或者部分转让的，仲裁协议对受让人有效，但当事人另有约定、在受让债权债务时受让人明确反对或者不知有单独仲裁协议的除外。

33. Enforcement of Arbitration Agreement Decline of Jurisdiction Dismiss of Court Action Stay of Court Proceedings (Common Law Jurisdiction)