Russia / 27 July 2011 / Russia, Высший Арбитражный Суд Российской Федерации (Highest Arbitrazh Court of the Russian Federation) / OAO Tula Ammunition Factory v Sporting Supplies International Inc. / VAS - 7301/11
Country | Russia |
Court | Russia, Высший Арбитражный Суд Российской Федерации (Highest Arbitrazh Court of the Russian Federation) |
Date | 27 July 2011 |
Parties | OAO Tula Ammunition Factory v Sporting Supplies International Inc. |
Case number | VAS - 7301/11 |
Applicable NYC Provisions | II | II(3) |
Source |
http://kad.arbitr.ru (register of decisions of the RF arbitrazh courts) |
Languages | English |
Summary | On 1 April 2009, Tula Ammunition Factory (“Tula Factory”) and Sporting Supplies International (“Sporting Supplies”) entered into two product delivery contracts (together the “Contracts” and each a “Contract”). Paragraph 13 of each Contract contained a provision providing that any dispute arising out of the Contract would be settled by an arbitration court at the location of the claimant and according to the rules of the country governing the proceedings. Tula Factory brought proceedings to the Arbitrazh Court of the Tula Region (court of first instance) to recover sums for the products delivered pursuant to the Contracts. The court of first instance dismissed the case on the basis that, pursuant to Article 150(1)(1) of the Arbitrazh Procedure Code of the Russian Federation, it lacked jurisdiction to hear the dispute. The Twentieth Arbitrazh Court of Appeal (court of appeal) subsequently overturned the ruling of the lower court and remanded the case. This decision was confirmed by the Federal Arbitrazh Court for the Central District (court of cassation). Sporting Supplies sought a supervisory review of the decision of the Federal Arbitrazh Court before the Highest Arbitrazh Court of the Russian Federation on the grounds that the law had been inconsistently interpreted and applied. Sporting Supplies argued that since the parties had not agreed to adjudicate the dispute at the location of the claimant pursuant to paragraph 13 of the Contracts, the court with jurisdiction to hear the dispute was, according to general principles of private international law, the court at the location of the respondent. The Highest Arbitrazh Court of the Russian Federation dismissed the petition for supervisory review due to the absence of inconsistency in interpretation and application of the law. The Court reproduced the text of Article II(3) NYC and noted that, in order for the arbitration agreement to be enforceable, it had to contain clear language from which the parties’ true intention about their choice of an arbitration body could be determined. The Court further noted that such determination could not be made on the basis of paragraph 13 of the Contracts which simply provided, without giving further detail, that disputes would be heard and an award would be rendered by an arbitrator. On this basis, the Court held that the Contracts did not contain a valid arbitration agreement and that, on the basis of general principles of private international law, the court of first instance had jurisdiction to hear the dispute. The Court thus dismissed the petition for supervisory review. |
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Attachment (2)
Original Language Adobe Acrobat PDF |
Unofficial Translation Adobe Acrobat PDF |