In a German-language decision dated 27 February 2019, but only recently published, the Swiss Supreme Court denied an application to set aside an award, confirming the decision of a three-member arbitral tribunal, seated in Zurich under the auspices of the International Chamber of Commerce, denying its jurisdiction.
The underlying dispute arose in connection with an agency agreement between a Qatari agent, the appellant in this case, and a Turkish principal. According to Turkish law, a special authority is required to consent to arbitration. In the present case, the arbitral tribunal found that it had not been proven that the signatory on behalf of the Turkish principal had such special authority when signing the agency agreement containing the arbitration clause. The arbitral tribunal denied jurisdiction on that basis.
The appellant challenged the arbitral award before the Swiss Supreme Court, on the grounds that the arbitral tribunal wrongly denied its jurisdiction.
The court held, among other things, that an appellant must challenge all independent grounds on which the arbitral tribunal based its decision, failing which a challenge is inadmissible. This, however, does not include obiter dicta (incidental) considerations. The fact that the appellant did not challenge an incidental argument made by the arbitral tribunal, therefore, did not, by itself, lead to the inadmissibility of the setting aside application.
This decision serves as an important reminder that parties negotiating contracts, which include arbitration clauses, are well advised to obtain clarification on whether the local law of their counterparty requires special authority for consent to arbitration and whether the intended signatory is vested with such special authority. Also, in setting aside applications, an appellant must carefully analyse whether the arbitral tribunal based its reasoning on several independent grounds or issued obiter dicta, a distinction which is not always easy to make.
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