Summary enforcement

Section 66 of the Arbitration Act 1996 provides a mechanism for the summary enforcement of English arbitration awards. Enforcement is to follow unless there is serious doubt as to the validity of the award. There is one specific statutory exception, in s66(3), which permits the court to refuse enforcement if it is shown that the arbitrators acted without jurisdiction. In Sovarex SA v Romero Alvarez SA [2011] EWHC 1661 (Comm) Hamblen J considered whether the right to contest the award on jurisdictional grounds had been lost and, if not, the effect of proceedings in Spain running parallel to the arbitration in which the validity of the arbitration clause had been raised.

Sovarex: the facts

Sovarex contended that on 3 June 2008 it entered into a contract under which it was to sell to Alvarez 5,000mt of sunflower seeds for shipment between 15 September and 15 October 2008, and that the contract contained an arbitration clause providing for arbitration in London under FOSFA Rules. The contract was claimed to have been made by telephone and email. Alvarez denied the existence of any contract, and so asserted on 17 September 2008, when performance was due. Sovarex took that denial as a repudiation of the contract. In October 2008 Alvarez commenced proceedings in Spain for a declaration that there was no contract between the parties, although the proceedings were not served on Sovarex until April 2009. In the meantime, Sovarex commenced a FOSFA arbitration on 16 December 2008. Alvarez sent a message to FOSFA on 18 February 2009 refusing to appoint an arbitrator, setting out reasons why FOSFA should not deal with the arbitration, maintaining its assertion that there was no agreement and pointing out that the matter was the subject of proceedings in Spain.