Arbitration Law Monthly

In Republic of Serbia v ImageSat International NV [2010] 1 Lloyd’s Rep 324 Beatson J discussed at length, in an appeal under s67 of the Arbitration Act 1996, the issue of whether an arbitrator possessed jurisdiction to rule on the question of whether a new state, Serbia, had acquired the rights and liabilities under an arbitration clause of an earlier dissolved state (Serbia and Montenegro) following the dissolution of that state. The outcome ultimately turned on the learned judge’s finding that Serbia had, by agreement, conferred jurisdiction on the arbitrator to rule on that matter, but the case contains a lengthy analysis of jurisdiction agreements and the consequences for a s67 application where the jurisdictional issue determined by the arbitrator was not justiciable in the English courts.

The parties may opt to submit their dispute to arbitration in accordance with the rules of an arbitral association. It often happens that those rules change in the time between the making of the contract and the reference of the dispute to arbitration. Are the applicable arbitral rules the original rules or the new rules? The general run of cases is that the parties are to be taken to have agreed to the arbitral rules which happen to be in force at the date of the reference to arbitration. That principle has been reaffirmed in Car & Cars Pte Ltd v Volkswagen AG [2009] SGHC 233.

Arbitration proceedings are subject to the Limitation Act 1980, and must be commenced within the relevant statutory limitation period (generally six years from the date of breach of contract). In addition, the parties may agree contractual time limits which reduce the available period. Section 12 of the Arbitration Act 1996 permits the court to extend contractual, but not statutory, time limits. Lantic Sugar Ltd v Baffin Investments Ltd [2009] EWHC 3325 (Comm) is an illustration of the limited nature of the court’s power.

The decision of HHJ Havelock-Allan QC in Capes (Hatherden) Ltd v Western Arable Services Ltd [2009] EWHC 3065 (QB) deals with a series of difficult issues concerning the existence of an agreement to arbitrate as derived from a course of dealing between the parties, the scope of the arbitration clause and whether the parties had entered into an ad hoc agreement to arbitrate by reason of the fact that an arbitration had been commenced. Of particular interest is the argument by the claimant that an arbitration clause falls foul of art 6 of the European Convention on Human Rights, and thus is not binding unless specifically drawn to his attention, if the pool of arbitrators represents the interests of the other party to the proceedings.