Georgia / 15 May 2009 / Georgia, საქართველოს უზენაესი სასამართლო (Supreme Court of Georgia) / “S.F.M.” LLC v. Batumi City Hall / a-471-sh-21-09
| Country | Georgia |
| Court | Georgia, საქართველოს უზენაესი სასამართლო (Supreme Court of Georgia) |
| Date | 15 May 2009 |
| Parties | “S.F.M.” LLC v. Batumi City Hall |
| Case number | a-471-sh-21-09 |
| Applicable NYC Provisions | II | III | V | II(1) | V(1)(a) | V(1)(b) | V(2)(a) |
| Source |
http://prg.supremecourt.ge (website of the Supreme Court of Georgia) |
| Languages | English |
| Summary | “S.F.M.” LLC (“SFM”) entered into a sales contract with Batumi City Hall (“Batumi”). A dispute arose between the parties and SFM initiated arbitration proceedings before the International Commercial Arbitration Court at the Russian Chamber of Commerce and Industry (ICAC), as provided for in the sales contract. On 24 May 2007, the ICAC rendered an award ordering Batumi to pay damages and costs to SFM. SFM applied to the Supreme Court of Georgia for recognition and enforcement of the award in Georgia, which Batumi challenged based on Article V(2)(a) NYC and the Private International Law of Georgia. It argued that the subject matter of the dispute was non-arbitrable under Georgian law, and, moreover, that it had not been served SFM’s statement of claim and had thus been unaware of SFM’s case against it. The Supreme Court of Georgia granted recognition and enforcement of the arbitral award. It found that it was not authorized to review the lawfulness and appropriateness of the reasoning behind foreign arbitral awards and was bound to enforce them as required under Article III NYC. The Supreme Court held that although recognition and enforcement could be refused pursuant to Article V(1)(b) NYC, in the present case Batumi had been notified of the initiation of the arbitration proceedings and SFM’s appointment of an arbitrator. It also noted that Batumi had been provided with SFM’s statement of claim and that, despite this, it had failed to appoint an arbitrator or submit a response in the proceedings. It thus ruled that Article V(1)(b) NYC was not applicable to the present case. The Supreme Court also rejected Batumi’s second argument that the subject matter of the dispute was non-arbitrable under Article V(2)(a) NYC and the Private International Law of Georgia. The Supreme Court, relying on Article II(1) NYC, held that the sales contract provided for arbitration under the ICAC, and as Batumi had failed to establish that the written arbitration agreement had been declared void or ineffective, as it would be required to do under Article V(1)(a), the Supreme Court could not refuse enforcement. It thus concluded that no grounds existed for refusing recognition and enforcement of the award, either under Article V NYC or the Private International Law of Georgia. It thus recognized the decision as final and enforceable in Georgia pursuant to Article III NYC. |
Attachment (2)
 Original Language Adobe Acrobat PDF |
Unofficial Translation Adobe Acrobat PDF |
