Tag Archives: arbitration law

The law governing an arbitration clause

By Prof Jonathan Hill, Professor of Law (University of Bristol Law School).

A leading commentator has observed that ‘[t]he choice of the law applicable to an international commercial arbitration agreement is a complex subject’ (Born, International Commercial Arbitration (2nd edn, 2014) p 472). This complexity is reflected by the case law illustrating that the courts of different countries adopt different approaches to certain common scenarios. One area of divergence is the case where parties to a contract containing an arbitration clause choose state A as the seat of arbitration, but the law of state B as the law governing the matrix contract: which law governs the arbitration clause – the law of the seat or the law of the country chosen to govern the substantive contract?

Some legal systems, influenced in part by the doctrine separability (according to which a contractual arbitration clause is, conceptually, treated as a contract separate and independent from the matrix contract) and article V.1.a of the New York Convention of 1958, take the view that, in the absence of an express choice by the parties of the law applicable to the arbitration clause, the law of the seat should govern questions of material validity. English law, however, has never taken this view – although, arguably, the Court of Appeal came close to doing so in C v D [2007] EWCA Civ 1282. Continue reading

Conflicting jurisdiction and arbitration agreements: Exmek Pharmaceuticals SAC v Alkem Laboratories Ltd

By Prof Jonathan Hill, Professor of Law (University of Bristol Law School).

© Investment News, 2013.

© Investment News, 2013.

A previous blog addressed certain problems surrounding the interpretation of arbitration clauses, particularly in relation to a lack of transparency concerning the parties’ choice of the seat of arbitration. This blog continues the same theme – albeit in the context of different interpretative questions.

Although the notion of the ‘pathological’ arbitration clause has been part of the international arbitration literature for nearly half a century, difficulties generated by poor drafting continue to bedevil both arbitral tribunals and the courts. Notwithstanding the availability of a wealth of clear and helpful advice (see, for example, Born, International Arbitration and Forum Selection Agreements: Drafting and Enforcing (4th edn, 2014), a surprising number of those who draft commercial contracts seem to be either unaware of the available advice or incapable of heeding it. Continue reading

The interpretation of arbitration clauses: where is the seat of arbitration?

By Prof Jonathan Hill, Professor of Law (University of Bristol Law School).

© http://wordstodeeds.com/

© http://wordstodeeds.com/

It is a truism that arbitration clauses are often poorly drafted, not infrequently agreed at the 11th hour or lifted (inappropriately) from unrelated contracts. As a consequence, courts often have to try to make sense of clauses which are unclear or potentially inconsistent. In Shagang South-Asia (Hong Kong) Trading Co Ltd v Daewoo Logistics [2015] EWHC 194 (Comm), [2015] 1 All ER (Comm) 245 the parties had agreed that arbitration was to be ‘held in Hong Kong’, but that ‘English law [was] to be applied’. After the tribunal had rendered its award, the claimant applied to the English court for setting aside of the award under section 67 of the Arbitration Act 1996. As in Dubai Islamic Bank v Paymentech [2001] 1 Lloyd’s Rep 65, the English court’s setting aside jurisdiction depended on England being the seat of arbitration (see Arbitration Act 1996, s 2(1)). Continue reading