International Arbitration

Streamlining, While Competition Heats Up

Case law

Recent Swedish case law has suggested that the courts are becoming more supportive of the arbitration process; for example:

Arbitrators’ fees. The SCC rules provide that the costs of the arbitration, including the arbitrators’ fees, are to be decided finally by the SCC institute. However, the Swedish Supreme Court has held that a party did not lose the right to appeal such a decision to the district court under section 41 of the Swedish Arbitration Act (Soyak International Construction & Investment Inc v Hober, Kraus and Melis, NJA 2008 p. 1118). The case was remanded to the district court but, since the arbitrators accepted the reduction claimed, no decision was made on the merits.

Reasons for award. An arbitration agreement may require the arbitral tribunal to provide reasons for the award. In Soyak International Construction & Investment Inc v Hochtief AG, the Swedish Supreme Court considered whether an arbitral tribunal had fulfilled its obligation to provide reasons under the SCC rules (NJA 2009 p. 128). The court found that only if the award completely lacked reasons or included reasons which were so incomplete that they corresponded to a complete lack of reasons, could this constitute a challengeable procedural error.

Seat of arbitration. In Titan Corporation v Alcatel CIT SA, the Svea Court of Appeal held that it lacked jurisdiction in challenge proceedings on the basis that, although the agreed seat of arbitration was Stockholm, there was insufficient connection between the arbitration and Stockholm (RH 2005:1).

Not only did the dispute concern a contract that had no connection to Sweden, it was an ICC arbitration involving French and American parties, hearings had taken place in London and Paris and the arbitrator, who was from the UK, had, presumably, done his work in London.

However, in RosInvestCo UK Ltd v Russian Federation, the Swedish Supreme Court clearly rejected this reasoning (NJA 2010 p.508). It held that, if the parties have agreed that the seat of arbitration will be in Sweden, it is irrelevant that the parties or the arbitrators have chosen to hold meetings abroad, that the arbitrators were not from Sweden, that they had done their work abroad or that the dispute concerned a contract which, in other respects, has no connection to Sweden.

After RosInvestCo UK Ltd, the heavily criticised appeal court ruling in Titan would appear no longer to carry any precedential value.

Matthew Secomb and Christophe von Krause are partners, and Paul Giraud is an associate, in the Paris office; David Goldberg and Michael Turrini are partners, Anthony Lavers is Counsel, and Julia Zagonek and Dipen Sabharwal are associates, in the London office; Dr Patricia Nacimiento is a partner, and Christian M Theissen is an associate, in the Frankfurt office; Aloke Ray is a partner, Nandakumar Ponniya is a local partner, and Matthew Shaw is an associate, in the Singapore office; Ola Nils-son is Counsel in the Stockholm office; and Heather Clark is an associate in the New York office of White & Case LLP.

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