Germany / 15 May 1986 / Bundesgerichtshof / BGH III ZR 192/84
| Country | Germany |
| Court | Germany, Bundesgerichtshof (Federal Court of Justice) |
| Date | 15 May 1986 |
| Case number | BGH III ZR 192/84 |
| Applicable NYC Provisions | V | V(2)(b) |
| Source | BGH |
| Summary | The Parties entered into a charterparty containing a clause providing for arbitration in London. Under the clause, each Party was to appoint one arbitrator. In the event that the arbitrators failed to reach an agreement on the decision, they would have to select an umpire to decide the dispute. The Claimant submitted a claim to arbitration and advised the Defendant that it had nominated an arbitrator, requesting that the Defendant appoint an arbitrator in 7 days or that otherwise its arbitrator would act as a sole arbitrator. The Defendant did not nominate an arbitrator and the sole arbitrator rendered an award in favor of the Claimant. Recognition was denied by the Landgericht (Lower Regional Court) Hamburg. The Hanseatisches Oberlandesgericht (Higher Regional Court Hamburg) reversed the decision and granted enforcement. The Defendant appealed. The Bundesgerichtshof (Federal Supreme Court) upheld the decision of the Hanseatisches Oberlandesgericht and granted enforcement. It concluded that the duty of impartial administration of justice is part of German public policy within the meaning of Article V(2)(b) NYC. "Ordre public international" is only considered infringed if the foreign tribunal has rendered an award on the basis of a proceeding deviating from fundamental principles of German procedural law to such an extent that the award cannot be considered rendered in an orderly procedure in accordance with the rule of law. In the interest of international trade, narrow limits must be drawn for the concept of German public policy in the context of recognition and enforcement. The recognition of an arbitral award can generally only be denied in those cases where the violation of the duty of impartial administration of justice had a real impact on the arbitral proceedings. The Court reasoned that the Defendant would have had to show that the arbitrator was unfit to act because he was partial towards one party, and that it had not met this burden. |
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