Introduction

¹ See Chapter 1, paragraph 1.40.

² As discussed later in this chapter, consent can be deemed by conduct or found in more than one document.

³ Except for arbitrations conducted under the ICSID Convention. For further discussion of delocalised arbitration, see Chapter 3, paragraphs 3.76–3.77.

⁴ Compulsory arbitration does exist. Nationally, it is used as a supposedly cheap and informal method of resolving disputes in particular areas. Internationally, the most striking example of compulsory arbitration was in the socialist countries of Central and Eastern Europe, where it was employed as the method of settling disputes under the provisions of the Convention on the Settlement of Arbitration of Civil Law Disputes Arising from Relations of Economic, Scientific and Technical Co-operation (Moscow Convention) of 1972. However, compulsory arbitration is outside the scope of this book, which is concerned with the mainstream of international arbitration—that is, with arbitration as a consensual process, taking place pursuant to an arbitration agreement.

⁵ This is not a universal rule. A submission agreement may take the form of a brief agreement to submit an existing dispute to the procedures of an arbitral institution. Conversely, an arbitration clause providing for ad hoc arbitration could identify the procedure to be followed in detail, as well as the means of establishing the arbitral tribunal, filling vacancies, and so forth.

⁶ It should be noted, however, that, in some Latin American states, e.g. Argentina and Uruguay, a clause to submit future disputes to arbitration is not operative until a submission agreement (or compromiso) has also been executed. (The same is also true of Brazil unless the arbitration clause incorporates a mechanism to constitute the arbitral tribunal, which it may do by reference to a set of institutional rules.) In these jurisdictions, the ICC Rules may be preferred because they provide for a functional equivalent to the compromiso (the terms of reference), which are not included in other institutional rules. See Blackaby, Lindsey, and Spinillo, International Arbitration in Latin America (Kluwer Law International, 2002), pp. 12, 31–32, and 73; Naón, ‘Arbitration and Latin America: Progress and setbacks—2004 Freshfields Lecture’ (2005) 21 Arb Intl 127; Blad (ed.), International Comparative Legal Guide to International Arbitration (5th edn, Global Legal Group, 2008), pp. 281 and 295.

⁷ For a step-by-step guide to drafting arbitration clauses, see Paulsson, Rawding, and Reed (eds) The Freshfields Guide to Arbitration Clauses in International Contracts (3rd edn, Kluwer Law International, 2010).

⁸ See, e.g., the Bustamante Code of 1928 and the European Convention of 1961.

⁹ The New York Convention replaces the Geneva treaties between states that have become bound by it: Art. VII(2).

¹⁰ New York Convention, Arts II(1) and II(3).

¹¹ The Model Law follows a similar pattern.

¹² It too recognises the validity of an agreement that submits existing and future disputes to arbitration: Panama Convention, Art. 1.

¹³ Its formal title is ‘The Convention on the Settlement of Civil Law Disputes Resulting from Economic, Scientific and Technological Cooperation’. The text of the Convention appears in (1978) III YBCA 15.

¹⁴ Such as the European Convention of 1961 and the ICSID Convention.

¹⁵ As in Botticelli’s painting The Birth of Venus (c. 1486).

¹⁶ Wetter, ‘The present status of the International Court of Arbitration of the ICC: An appraisal’ (1990) 1 Am Rev Intl Arb 91, at 93.

¹⁷ Mustill, ‘Arbitration: History and background’ (1989) 6 J Intl Arb 43, at 49. See also Schwebel, ‘A celebration of the United Nations’ New York Convention’ (1996) 12 Arb Intl 83.

¹⁸ The first three are also contained in the Model Law, Art. 7(1) and (2), and the fourth in Arts 34(2)(b) and 36(2)(b)(i). More recently, however, the UN Commission on International Trade Law (UNCITRAL) formulated and adopted a recommendation regarding the interpretation of Arts II(2) and VII(1) of the New York Convention on 7 July 2006, by which it recognised that Art. II(2), which defines the way in which the ‘writing’ requirement must be fulfilled, must be applied ‘recognizing that the circumstances described therein are not exhaustive’. See paragraphs 2.13ff.

¹⁹ They are also to be found in the Model Law, Arts 34(2)(a) and 36(1)(a)(i).

²⁰ Although it should be noted that the burden of proof is on the party opposing recognition or enforcement, who must prove lack of capacity or invalidity.

²¹ See the discussion in Chapter 1, paragraph 1.39.

²² In this regard, see Landau, ‘The requirement of a written form for an arbitration agreement: When “written” means “oral” ’, Sixteenth ICCA Congress, London, 12–15 May 2002.

²³ See, e.g., the cases cited in Cohen, ‘Agreements in writing: Notes in the margin of the Sixth Goff Lecture’ (1997) 13 Arb Intl 273. This article is a response to the earlier Kaplan, ‘Is the need for writing as expressed in the New York Convention and Model Law out of step with commercial practice?’ (1996) 12 Arb Intl 27. More recently, see also Kanematsu USA Inc. v ATS—Advanced Telecommunications Systems do Brasil Ltda, SEC 885, 18 April 2012, in which the Brazilian Supreme Court of Justice held that a signature is required where a party seeks to incorporate into a contract an arbitration clause contained in a set of standard terms and conditions.

²⁴ See Obergericht of Basle, 3 June 1971, (1979) IV YBCA 309; Miserecchi v Agnesi, Judgment No. 3620, Corte di Cassazione, 13 December 1971, (1976) I YBCA 190, with comment by Barone in [1972] Riv di Dir Internaz, Priv e Proc 563.

²⁵ On 7 July 2006, UNCITRAL issued a recommendation that Art. II(2) of the New York Convention be applied ‘recognizing that the circumstances described therein are not exhaustive’. Subsequently, on 4 December 2006, the Model Law was amended pursuant to General Assembly Resolution 61/33 to include notable changes to Art. 7 on the writing requirement.

²⁶ Option 1 has been adopted by, e.g., Singapore in its 2012 revision to the Singapore International Arbitration Act, s. 2A.

²⁷ Arab African Energy Corporation Ltd v Olieprodukten Nederland BV [1983] 2 Lloyd’s Rep 419; however, such a form is not recommended. See also Jianxi Provincial Metal and Minerals Import and Export Corporation v Sulanser Co. Ltd [1996] ADRLJ 249, in which an exchange of communications between a party to the contract and a third party, copied to the other party, could constitute an agreement in writing.

²⁸ Netherlands Arbitration Act 1986, s. 1021; see the commentary on this article in Sanders and van den Berg, The Netherlands Arbitration Act 1986: Text and Notes, English (Kluwer, 1987), p. 12, where it is said that the Act abolishes the possibility, which existed under the old Act, that an arbitration agreement could be concluded orally, but that an arbitration agreement is deemed to be concluded if the parties appear before the arbitral tribunal without invoking the lack of an agreement prior to raising any defence.

²⁹ Similar wording is contained in s. 7 of the Indian Arbitration and Conciliation Act 1996. See Great Offshore Ltd v Iranian Offshore Engineering and Construction Co. (2008) 14 SCC 240 for an analysis of the Indian law position.

³⁰ See Sanders, ‘Arbitration’, in Cappelletti (ed.) Encyclopedia of International and Comparative Law, Vol. XVI (Brill, 1987), ch. 12, para. 106.

³¹ See, e.g., the English Arbitration Act 1996, s. 5(43)ff. The ‘implied consent’ provisions of the Model Law are also to be found in s. 5(5). In Heifer International Inc. v Christiansen [2007] EWHC 3015 (TCC), the court held that an arbitration agreement was validly concluded by reference to a written arbitration clause contained in another contract.

³² See, e.g., Liebscher, ‘Interpretation of the written form requirement Art. 7(2) UNCITRAL Model Law’ (2005) 8 Int ALR 164 and the cases cited therein.

³³ In recent revisions to their respective arbitration laws, Belgium and Scotland have adopted the Option 2 wording. See art. 1681 of the Code Judiciaire and s. 4 of the Arbitration (Scotland) Act 2010, respectively.

³⁴ See also the New Zealand Arbitration Act 1996, s. 7(1), which provides that ‘an arbitration agreement may be made orally or in writing’.

³⁵ See, e.g., the decision of the Second Circuit Court of Appeals in Kahn Lucas Lancaster Inc. v Lark International Ltd 186 F.3d 210 (2nd Cir. 1999). This decision has been applied by a number of other US courts, which have arrived at varying interpretations (some liberal; others less so) of an ‘exchange of letters and telegrams’. See, e.g., the US District Court of the Southern District of California decision in Chloe Z Fishing Co. Inc. v Odyssey Re (London) Ltd 109 F.Supp.2d 1048 (SD Cal. 2000); the US District Court of the Western District of Washington decision in Bothell Bothell v Hitachi Zosen Corporation 97 F.Supp. 2d 1048 (WD Wash. 2000); the Third Circuit Court of Appeals decision in Standard Bent Glass Corporation v Glassrobots Oy 333 F.3d 440, 449 (3rd Cir. 2003). Most recently, the District Court of the Southern District of New York has affirmed the Kahn Lucas approach, but found that email exchanges between the parties ‘comfortably satisf[ied] the standard set by the [New York] Convention’: Glencore Ltd v Degussa Engineered Carbons LP 848 F.Supp.2d 410 (SDNY 2012).

³⁶ See the discussion in Chapter 3 on the law governing the arbitration agreement.

³⁷ Decision of the Halogaland Court of Appeal (Norway), 16 August 1999, (2002) XXVII YBCA 519.

³⁸ Including, particularly, the requirement in some jurisdictions, e.g. Paraguay, that an arbitration clause is not operative until a submission agreement has also been executed: see n. 6.

³⁹ (1992) 87 DLR (4th) 129, (1994) XVII YBCA 346.

⁴⁰ The Court held that a dispute ‘arises out of or in connection with a contract’ if the ‘existence of the contract is germane either to the claim or the defence’: ibid., at 295–297.

⁴¹ Courts around the world have adopted even wider interpretations of similar clauses, although the underlying principles are similar. The Chinese courts have held that ‘all disputes arising out of or in connection with the contract’ will capture tortious claims: see the view of the Supreme People’s Court (SPC) in SPC, The Second National Foreign-related Commercial and Maritime Trial Work Meeting Minutes (26 December 2005), art. 7. See also Decision No. 506/2010 of the Greek Supreme Court of 10 February 2010, in which the Court held that tortious claims were within the scope of a standard ICC arbitration clause. See also ABI Group Contractors Pty v Transfield Pty Ltd (1999) 14 Mealey’s Intl Arb Rep G1, summarised in (1999) XXIV YBCA 591; Multistar Leasing Ltd v Twinstar Leasing Ltd, Civil Action Case No. 98-1330, US District Ct, Eastern District of Louisiana, 28 August 1998, summarised in (2000) XXV YBCA 871; American Bureau of Shipping v Tencara SpA, Judgment No. 8744, Italian Corte di Cassazione, Plenary Session, 26 June 2001, summarised in (2002) XXVII YBCA 509. See also the commentary by van den Berg, ‘Scope of the arbitration agreement’ (1996) XXI YBCA 415. Finally, see also the decision of the Federal Court of Australia in Walter Rau Neusser Oel Und Fett Ag v Cross Pacific Trading Ltd [2005] FCA 1102, discussed in Morrison, ‘Defining the scope of arbitrable disputes in Australia: Towards a “liberal” approach?’ (2005) 22 J Intl Arb 569.

⁴² The decision of the English House of Lords in Fiona Trust and Holding Corporation v Privalov [2007] UKHL 40 offers further guidance. Lord Hoffmann considered the prior case law concerning the construction of arbitration clauses and the precise meaning of wording such as ‘arising out of’, and opined that ‘the distinctions which they make reflect no credit upon English commercial law’: at [12]. He continued, at [13]:

[T]‌he construction of an arbitration clause should start from the assumption that the parties, as rational businessmen, are likely to have intended any dispute arising out of the relationship into which they have entered or purported to enter to be decided by the same tribunal. The clause should be construed in accordance with this presumption unless the language makes it clear that certain questions were intended to be excluded from the arbitrator’s jurisdiction.

⁴³ New York Convention, Arts II(1) and V(2)(a); Model Law, Arts 34(2)(b)(i) and 36(1)(b)(i).

⁴⁴ See paragraphs 2.211ff.

⁴⁵ For example, in the recognition and enforcement of the award.

⁴⁶ New York Convention, Art. II(3); Model Law, Art. 8(1).

⁴⁷ New York Convention, Art. V(1)(a); Model Law, Art. 36(1)(a).

⁴⁸ Otherwise, the agreement will be regarded as invalid and accordingly unenforceable: see the provisions of the New York Convention and the Model Law cited above.

⁴⁹ Regulation (EC) No. 593/2008 of the European Parliament and of the Council of 17 June 2008 on the law applicable to contractual obligations (Rome I), OJ L 177/6, 4 July 2008. The uniform rules of this Regulation do not apply to questions involving the status or legal capacity of natural persons, except as stated.

⁵⁰ See, e.g., within the European Union, Directive 2009/101/EC of the European Parliament and of the Council of 16 September 2009 on coordination of safeguards which, for the protection of the interests of members and third parties, are required by Member States of companies within the meaning of the second paragraph of Article 48 of the Treaty, with a view to making such safeguards equivalent, OJ L 258/11, 1 October 2009.

⁵¹ In 2007, the Labetoulle Report proposed to abolish the prohibition contained in art. 2060 and a draft law was prepared in order to ‘broaden the possibility for recourse to arbitration for public bodies and to clarify the procedural regime of arbitrations involving public law’: Groupe de travail sur l’arbitrage en matière administrative, Rapport, 13 March 2007, available online at http://www.justice.gouv.fr/art_pix/Rapport_final.pdf (in French). At the time of writing, no amendments have yet been made to art. 2060.

⁵² See the decision of the Paris Cour d’Appel in INSERM v Fondation F. Saugstad, Paris Cour d’Appel, 13 November 2008. See also the decision of the Conseil d’État Libanais, Etat Libanais v Societe FTML (Cellis) SAL, 17 July 2001, in which the Lebanese State Council, with reference to French law, held that public entities could submit to international arbitration only those contracts that do not involve the exercise of the state’s prerogatives of public power. This ruling was heavily criticised in Lebanon and resulted in a new Law No. 40 being enacted by the Lebanese Parliament establishing the validity of arbitration agreements in all contracts of the state and public entities, with the exception of administrative contracts being effective only after approval of the Council of Ministers. However, it is now generally accepted that, under French law, public entities cannot rely on provisions of French law to evade obligations contained in an international arbitration agreement that they have signed: Hanotiau and Olivier, ‘Arbitrability, due process, and public policy under Article V of the New York Convention: Belgian and French perspectives’ (2008) 25 J Intl Arb 721, at 724.

⁵³ The arbitration agreement must relate to the settlement of disputes regarding the formation or the performance of an agreement: see Code Judiciaire, art. 1676(3).

⁵⁴ See Companhia Paranaense de Gas (‘Compagás’) v Carioca Passarelli Consortium (‘Consortium’), Appeal No. 247.646-0, Paraná Court of Appeals, 11 February 2004; Copel v Energetica Rio Pedrinho S.A., Agravo de Instrumento No. 174.874-9, Paraná Court of Appeals, 11 May 2005; Companhia Estadual de Energia Eléctrica (‘CEEE’) v AES, Recurso Especial No. 612.439-RS, Paraná Superior Court of Justice, 14 September 2006.

⁵⁵ For example, in Venezuela, s. 4 of the Commercial Arbitration Act 1998 provides that when one of the parties to the arbitration agreement is a state entity (or an entity in which the state holds a stake of at least 50 per cent), the arbitration agreement must be specifically approved by the relevant minister. Similar restrictions are contained in art. 139 of the Iranian Constitution and s. 10 of the Saudi Arabian Law of Arbitration (Royal Decree No. M/34 of 16 April 2012).

⁵⁶ It would also be advisable to ensure that, under the relevant state law, the subject matter of the contract is ‘arbitrable’ in the sense discussed later.

⁵⁸ Swiss PIL, s. 177(2). Presumably, however, the state concerned might try to rely on its own law to defeat recognition or enforcement outside Switzerland of any arbitration award against it.

⁵⁷ European Convention of 1961, Art. II(1) and (2).

⁵⁹ See, e.g., Benteler v State of Belgium, Ad Hoc Award, 18 November 1983; Award in ICC Case No. 4381, 113 J du Droit Intl 1102 (1986); Gatoil International Inc. v National Iranian Oil Co., High Court of Justice, Queen’s Bench Division, 21 December 1988, (1988) XVII YBCA 587; Buques Centroamericanos SA v Refinadora Costarricense de Petroleos SA US Dist. LEXIS 5429 (SDNY 1989). See also the 1989 Resolution of the Institut de Droit International, which provides that ‘[a]‌ State, a state enterprise, or a state entity cannot invoke incapacity to arbitrate in order to resist arbitration to which it has agreed.’

⁶⁰ See, e.g., Paulsson, ‘May a state invoke its internal law to repudiate consent to international commercial arbitration?’ (1986) 2 Arb Intl 90.

⁶¹ It is interesting to note in this context that the Swiss PIL, s. 177(2), refers both to ‘capacity’ and to ‘arbitrability’, so that—at the very least—the two concepts may merge.

⁶² See paragraph 2.13.

⁶³ See generally Derains, ‘L’extension de la clause d’arbitrage aux non-signatories: La doctrine des groupes de sociétés’ (1994) 8 ASA Special Series 241; Jarosson, ‘Conventions d’arbitrage et groupes de sociétés’ (1994) 8 ASA Special Series 209; Derains and Schaf, ‘Clauses d’arbitrage et groupes de sociétés’ [1985] RDAI 231; Fadlallah, ‘Clauses d’arbitrage et groupes de sociétés’ [1984–85] Travaux du Comité Français de Droit International Privé 105; Gaillard and Savage (eds) Fouchard Gaillard Goldman on International Commercial Arbitration (Kluwer Law International, 1999), paras 500ff.

⁶⁴ Sandrock has argued that all of the cases usually discussed in connection with the ‘group of companies’ theory ought to be regarded (or to have been decided) on theories of agency, such as the theory of the undisclosed principal (or, in some legal systems, indirect representation), the reverse construction of mandat apparent, or principles of good faith and estoppel: Sandrock, ‘Arbitration agreements and groups of companies’, in Dominice, Patry, and Reymond (eds) Études Pierre Lalive (Helbing & Lichtenhahn, 1993), p. 625; Sandrock, ‘The extension of arbitration agreements to non-signatories: An enigma still unresolved’, in Baums, Hopt, and Hom (eds) Corporations, Capital Markets and Business in the Law: Liber Amicorum Richard M Buxbaum (Kluwer Law International, 2000), p. 461.

⁶⁵ ICC Case No. 4131/1982 (Interim Award) in Dow Chemical France v ISOVER Saint Gobain (France) (1983) 110 J du Droit Intl 899, noted by Derains in (1984) IX YBCA 131.

⁶⁶ ICC Case No. 11405/2001.

⁶⁷ See ICC Case No. 4504/1985–86 (1986) 113 J du Droit Intl 1118; Peterson Farms Inc. v C & M Farming Ltd [2004] EWHC 121; City of London v Sancheti [2008] EWCA Civ 1283.

⁶⁸ Hanotiau, ‘Consent to arbitration: Do we share a common vision?’, 2010 Annual Freshfields Lecture, London, 21 October 2010. See also Ferrario, ‘The group of companies doctrine in international commercial arbitration: Is there any reason for this doctrine to exist?’ (2009) 26 J Intl Arb 647.

⁶⁹ Derains, n. 65, at 135 (emphasis added).

⁷⁰ Dow Chemical, n. 65, at 904. The tribunal looked carefully at the parties’ intentions in concluding the relevant arbitration clauses and said that the negotiating record showed that ‘neither the “Sellers” nor the “Distributors” attached the slightest importance to the choice of the company within the Dow Group that would sign the contracts’, and further (Derains, n. 65, at 132) that:

[T]‌he arbitration clause expressly accepted by certain of the companies of the group should bind the other companies which, by virtue of their role in the conclusion, performance, or termination of the contracts containing said clauses, and in accordance with the mutual intention of all parties to the proceedings, appear to have been veritable parties to these contracts or to have been principally concerned by them and the disputes to which they may give rise.

⁷¹ Société Isover-Saint-Gobain v Société Dow Chemical France, Paris Cour d’Appel, 22 October 1983, [1984] Rev Arb 98, at 100–101, n. Chapelle.

⁷² See, e.g., Chloro Controls (I) P Ltd v Severn Trent Water Purification Inc. and ors, Supreme Court of India, 28 September 2012. The Court referred repeatedly to ‘the real intention of the parties’ to support its conclusion that an arbitration clause contained in a shareholders’ agreement should be extended to a non-signatory company.

⁷³ See, e.g., Sponsor AB v Lestrade, Court of Appeal of Pau, 26 November 1986, [1988] Rev Arb 153 (the Court emphasised that Sponsor AB played an important role in the conclusion and execution of the contract, and in fact was ‘the soul, inspirer and, in a word, the brains of the contracting party’); ICC Case No. 5103/1988 [1988] J du Droit Intl 1206; Société Orthopaedic Hellas v Société Amplitude, No. 11-25.891, Cass. Civ. 1ere, 7 November 2012.

⁷⁴ See, e.g., Trelleborg do Brasil Ltda v Anel Empreendimentos Participações e Agropecuária Ltda, Apelação Cível No. 267.450.4/6-00, 7th Private Chamber of São Paulo Court of Appeals, 24 May 2004.

⁷⁵ Khatib Petroleum Services International Co. v Care Construction Co. and Care Service Co., Case No. 4729 of the Judicial Year 72, Egypt’s Court of Cassation, June 2004; Chaval v Liebherr, Recurso Especial No. 653.733, Brazilian Superior Court of Justice, 3 August 2006.

⁷⁶ Hanotiau, ‘Consent to arbitration: Do we share a common vision?’ 2010 Annual Freshfields Lecture, London, 21 October 2010.

⁷⁷ See Prest v Petrodel [2013] UKSC 34, at [22] per Lord Sumption.

⁷⁸ See, e.g., Wm Passalacqua Builders v Resnick Developers 933 F.2d 131 (2nd Cir. 1991). The alter ego doctrine has also been successfully applied in respect of states and state entities: see Bridas SAPIC, Bridas Energy International Ltd et al. v Government of Turkmenistan and Turkmennneft 345 F.3d 347 (5th Cir. 2006), discussed in the news section of [2006] Int ALR N3334; cf. ICC Case No. 9151, Joint Venture Yashlar and Bridas SAPIC v Government of Turkmenistan, Interim Award of 8 June 1999.

⁷⁹ Contracts (Rights of Third Parties) Act 1999, s. 1.

⁸⁰ See Contracts (Rights of Third Parties) Act 1999, s. 8. See also Nisshin Shipping Co. Ltd v Cleaves & Co. Ltd [2003] EWHC 2602 (Comm), in which the English High Court held that brokers seeking to enforce the terms of charterparties that conferred benefits on them (the payment of commissions) were bound by the arbitration clause therein. However, see Fortress Value Recovery Fund I LLC v Blue Skye Special Opportunities Fund LP [2013] EWCA Civ 367, in which the English Court of Appeal held that a third party joined as defendant in a contract claim in the English courts could not invoke the arbitration clause in the contract to obtain a stay of proceedings under s. 9 of the English Arbitration Act 1996.

⁸¹ Banque populaire Loire et Iyonnais v Société Sangar, Cour de Cassation (1ere Ch. Civ.), 11 July 2006.

⁸² See, e.g., Assicurazioni Generali SpA v Tassinari, Judgment No. 2384, Corte di Cassazione, 18 March 1997; L’Italia SpA v Milani, Judgment No. 3207, Corte de Cassazione, 1 April 1994.

⁸³ See Cargill International SA v M/T Pavel Dybenko 991 F.2d 1012, 1019 (2nd Cir. 1993); American Bureau of Shipping v Société Jet Flint SA 170 F.3d 349, 353 (2nd Cir. 1999); Avila Group Inc. v Norma J of California 426 F.Supp. 537, 542 (DCNY 1977) (‘To allow [a plaintiff] to claim the benefit of the contract and simultaneously avoid its burdens would both disregard equity and contravene the purpose underlying enactment of the Arbitration Act’); Astra Oil Co. Inc. v Rover Navigation, Ltd 344 F.3d 276, 279, n. 2 (2nd Cir. 2003); Birmingham Associates Ltd v Abbott Laboratories 547 F.Supp.2d 295 (SDNY 2008), 2008 US Dist LEXIS 30321.

⁸⁴ See Bundesgerichtshof decision (1978) 71 BGHZ 162, 164–165, and (2000) 53 NJW 2346. Traditionally, French law required explicit consent to transfer the arbitration agreement on assignment of the main contract (arts 1166 and 1275 of the Code Civil make a distinction between perfect and imperfect novation, of which only the former discharges the original debtor of its obligations, but requires the original creditor’s consent to that effect). However, recent case law has confirmed that transfer of the arbitration agreement is automatic on assignment of the main contract, whether domestic or international: Sté Alcatel Business Systems et Alcatel Micro Electronics c/v and ors, Cass. Civ. 1ere, 27 March 2007, (2007) 1 Bull Civ 129, (2007) 3 J du Droit Intl 18. For the English law position, see West Tankers Inc. v RAS Riunione Adriatica di Sicurta SpA (The Front Comor) [2005] 2 All ER (Comm) 240.

⁸⁵ There was a common law principle in New York law that arbitration was an ‘obligation’ not assumed by an assignee of a contract: see United States v Panhandle Eastern Corporation et al. 672 F.Supp. 149 (D. Del. 1987); Gruntal & Co., Inc. v Ronald Steinberg et al. 854 F.Supp. 324 (DNJ 1994); Lachmar v Trunkline LNG Co. 753 F.2d 8, 9–10 (2nd Cir. 1985); cf. Banque de Paris v Amoco Oil 573 F.Supp. 1465, 1472 (SDNY 1983). However, according to GMAC Commer Credit LLC v Springs Indus 171 F.Supp.2d 209 (SDNY 2001), 2001 US Dist LEXIS 5152, 44 UCC Rep. Serv. 2d 708 (6th Cir. 2001), this principle was superseded by New York’s adoption of the Uniform Commercial Code (UCC) § 9-318 in 1964 (now § 9-404 after the UCC was revised in 2000). In GMAC, the Court held that ‘the adoption of the Article 9 of the U.C.C. means that a finance assignee suing on an assigned contract is bound by that contract’s arbitration clause unless it secured a waiver from the signatory seeking to arbitrate’: GMAC, at 215.

⁸⁶ Ms Emja Braack Shiffahrts KG v Wärtsilä Diesel AB, Supreme Court of Sweden, 15 October 1997, [1998] Rev Arb 431, at 433, n. Hansson, Lecoanet, and Jarvin.

⁸⁷ See Reiner, ‘The form of the agent’s power to sign an arbitration agreement and Art. II(2) of the New York Convention’ (1999) 9 ICCA Congress Series 82.

⁸⁸ ICC Case No. 5832/1988 (1988) 115 J du Droit Intl 1198. Applying Austrian law, which requires authorisation to be given in writing by a principal to an agent in order for the latter validly to conclude an arbitration agreement (‘to provide clear and simple evidence and to protect the parties against the waiver of procedural guarantees’), the tribunal refused to regard the principal as bound by the purported arbitration agreement. The conflict-of-laws rules on these different aspects of agency are notoriously complex. See further Dicey, Morris, and Collins, The Conflict of Laws (15th edn, Sweet & Maxwell, 2012), pp. 2109ff.

⁸⁹ On Austrian law, see s. 1008 of the Civil Code and n. 88; on Swiss law, see art. 396(3) of the Swiss Federal Code of Obligations.

⁹⁰ See Rocco Giuseppe e Fli v Federal Commerce and Navigation Ltd, Judgment No. 6915, Corte di Cassazione, 15 December 1982, (1985) 10 YBCA 464.

⁹¹ See Code Civil, art. 1985; Code de Commerce, art. L1103 (formerly art. 109) (in respect of the contract of mandate or mandat); Total v Achille Lauro, Judgment No. 361, Corte di Cassazione, 25 January 1977, (1977) 17 Rassegna dell’Arbitrato 94, at 95. However, under art. 1989 of the Code Civil, the conclusion of an arbitration agreement requires specific authorisation.

⁹² See Landesgericht Hamburg, Judgment of 19 December 1967, [1968] Arbitrale Rechtspraak 138, at 140 (in respect of a commercial broker or Handelsmakler, under s. 75h(2) of the German Commercial Code). In Sandrock, ‘The extension of arbitration agreements to non-signatories: An enigma still unresolved’, in Baums, Hopt, and Hom (eds) Corporations, Capital Markets and Business in the Law: Liber Amicorum Richard M Buxbaum (Kluwer Law International, 2000), p. 467, the author expresses a belief that an arbitration agreement concluded by an agent or representative without the principal’s written authorisation would bind that principal only if, in the circumstances, third parties’ legitimate expectations were to require protection.

⁹³ On natural persons, see s. 8(1) of the English Arbitration Act 1996: ‘Unless otherwise agreed by the parties, an arbitration agreement is not discharged by the death of a party and may be enforced by or against the personal representatives of that party.’

⁹⁴ See, e.g., Interim Award in ICC Case No. 7337 (1999) 24 YBCA 149; Fyrnetics Ltd v Quantum Group Inc. 293 F.3d 1023 (7th Cir. 2002).

⁹⁵ See Award in ICC Case No. 6223/1991 (1997) 8 ICC Bulletin 69. See also AT&S Transportation LLC v Odyssey Logistics & Technology Corporation 803 NYS 2d 118 (2005), in which the US courts held that the sale of substantially all of the assets of company A to company B constituted a de facto merger and bound company B to an arbitration agreement signed by company A.

⁹⁶ See the section on insolvency at paragraph 2.141.

⁹⁷ See, e.g., the Privy Council (Turks and Caicos Islands) decision in The Bay Hotel and Resort Ltd v Cavalier Construction Co. Ltd [2001] UKPC 34, discussed in Melnyk, ‘The extent to which non-contracting parties can be encouraged or compelled to take part in arbitral proceedings: The English (Arbitration Act 1996) perspective’ (2003) 6 Int ALR 59, at 63. On the issue of joinder generally, see Hanotiau, Complex Arbitrations: Multiparty, Multicontract, Multi-issue and Class Actions (Kluwer Law International, 2005), ch. IV; Voser, ‘Multiparty disputes and joinder of third parties’, Presented at the ICCA Congress, Dublin, 9 June 2008.

⁹⁸ See Platte, ‘When should an arbitrator join cases?’ (2002) 18 Arb Intl 67; Mohan and Teck, ‘Some contractual approaches to the problem of inconsistent awards in multi-party, multi-contract arbitration proceedings’ (2005) 1 Asian Intl Arb J 161, at 164.

⁹⁹ Besides the UNCITRAL Rules, see also: Hong Kong International Arbitration Centre (HKIAC) Rules, Art. 27; ICC Rules 2012, Art. 7; London Court of International Arbitration (LCIA) Rules, Art. 22(1)(viii); Singapore International Arbitration Centre (SIAC) Rules, Art. 24(1)(b); Swiss Rules, Art. 4(2).

¹⁰⁰ The ICC and the HKIAC Rules both contain detailed provisions on joinder procedure, including the required contents of the request for joinder and the written submissions of the other parties.

¹⁰¹ Swiss Rules, Art. 4(2); HKIAC Rules, Art. 27(6).

¹⁰² See Voser, ‘Multiparty disputes and joinder of third parties’, Presented at the ICCA Congress, Dublin, 9 June 2008, at 46–49.

¹⁰³ The poet’s reflection that ‘a man’s reach should exceed his grasp, or what’s a heaven for?’ seems not to be apposite for an international arbitrator: Browning, ‘Andrea del Sarto’ (1855), line 97.

¹⁰⁴ Model Law, Arts 34(2)(iii) and 36(i)(a)(iii). The reference to a ‘submission to arbitration’ would include an arbitration clause and, e.g., the terms of reference in an ICC arbitration (as to which, see Chapter 1). There is a saving provision under both the Convention and the Model Law to the effect that if it is possible to separate the matters that were submitted to arbitration from those that were not, the award may be saved in respect of the matters that were submitted.

¹⁰⁵ For example, the Austrian Supreme Court held that ‘disputes resulting from the agreement’ does not cover non-contractual claims based on competition law that are connected to the underlying contract in no more than a ‘functionally illustrative’ way: Decision of the Supreme Court (Oberster Gerichtshof) No. 4 Ob. 80/08f, 26 August 2008, discussed in (2009) 12 Int ALR 40 (emphasis added).

¹⁰⁶ As a matter of Indian case law, arbitration clauses that state that ‘parties may refer disputes to arbitration’ have been held in the past to be optional rather than mandatory, thereby requiring the parties to agree afresh (by way of a submission agreement) to refer a particular dispute to arbitration: see the judgment of the Indian Supreme Court in Wellington Associates Ltd v Mr Kirit Mehta (2000) 4 SCC 272. See also the judgment of the Punjab and Haryana High Court in Sudarshan Chopra and ors v Company Law Board and ors (2004) 2 Arb LR 241.

¹⁰⁷ See the recommendations of the ICC, Final Report of the Working Group on the ICC Standard Arbitration Clause, ICC Doc. No. 420/318, 21 October 1991.

¹⁰⁸ A striking illustration of this policy can be seen in the decision of the US Federal District Court in Warnes SA v Harvic International Ltd, 3 December 1993, summarised in [1994] ADRLJ 65. The arbitration clause referred to the ‘New York Commercial Arbitration Association’, a non-existent association. The court held that it was clear that the parties intended to arbitrate and that an agreement on a non-existent forum was the equivalent of an agreement to arbitrate that does not specify a forum. Accordingly, the parties were directed to arbitrate in the American Arbitration Association (AAA) system.

¹⁰⁹ See Fiona Trust & Holding Corporation v Yuri Privalov [2007] EWCA Civ 20, at [19]. This pro-arbitration approach was endorsed by the House of Lords: Premium Nafta Products Ltd (20th Defendant) and ors v Fili Shipping Co. Ltd and ors [2007] UKHL 40.

¹¹⁰ See, e.g., Decision No. 4A-103/2011, 20 September 2011, in which an arbitration clause contained in a licence agreement was held to be wide enough to cover a dispute arising out of a connected sale-and-purchase agreement. The English High Court’s decision in PT Thiess Contractors Indonesia v PT Kaltim Prima Coal and anor [2011] EWHC 1842 (Comm) demonstrates the difficulties that may arise where separate, but related, contracts contain different dispute resolution clauses. The court was faced with a dispute that engaged two contracts: one containing an arbitration clause; the other submitting to the non-exclusive jurisdiction of the English courts. The court considered the scope of both dispute resolution provisions and the proper characterisation of the dispute, and ultimately decided that the English courts had jurisdiction.

¹¹¹ Or, even worse, might be overruled on appeal!

¹¹² See, e.g., Woolf v Collis Removal Service [1948] 1 KB 11, 18; F & G Sykes (Wessex) Ltd v Fine Fare Ltd [1967] 1 Lloyd’s Rep 53; The Angelic Grace [1995] 1 Lloyd’s Rep 87 (CA).

¹¹³ In the case of Prima Paint Corporation v Conklin Mfg Co. 388 US 395, 87 S.Ct 1801, 18 L.Ed.2d 1270 (1967), the words ‘any controversy or claim arising out of or relating to this agreement’ were described as a broad arbitration clause; in Scherk v Alberto-Culver