Quiz 2

Under Article V(1)(a) of the New York Convention, in which situations may a court refuse enforcement of an arbitral award based on issues with the arbitration agreement?

• When the parties were under an incapacity or the arbitration agreement was invalid under the law they chose, or under the law of the country where the award was made if no law was chosen

• If the award did not meet the formalities of the enforcing court’s jurisdiction

• When the arbitration agreement was not properly communicated between the parties

• Only if the agreement’s validity is contested based on public policy

Answer explanation

Article V(1)(a) allows refusal of enforcement if the parties were under incapacity or if the arbitration agreement was invalid according to the law chosen by the parties or, if not specified, the law of the country where the award was made.

According to Article V(1)(b), what due process issues might lead a court to refuse recognition and enforcement of an arbitral award?

• If the arbitrator had an undisclosed conflict of interest

• If the party against whom the award is invoked was not given proper notice of the arbitration proceedings or was otherwise unable to present their case

• If the arbitration proceedings were not conducted in the enforcing court’s language

• If the arbitral tribunal exceeded its procedural timeframe

Answer explanation

Article V(1)(b) allows refusal if the party against whom the award is invoked was not given adequate notice or was unable to present their case, as this would breach due process standards.)

How does Article V(1)(e) of the New York Convention address enforcement when an award has been set aside in its country of origin?

• The enforcing court must always refuse enforcement if the award has been set aside in the origin country

• The enforcing court may refuse enforcement if the award has been set aside or suspended by a competent authority in the country where it was made

• The enforcing court is obliged to enforce the award despite its annulment in the origin country

• The enforcing court must adjourn its decision until the annulment is overturned

Answer explanation

Article V(1)(e) allows the enforcing court discretion to refuse enforcement if the award has been annulled or suspended by a competent authority in the country where it was made.

In the Norsolor case, which principle allowed French courts to enforce an arbitral award that had been set aside in Austria?

• Forum selection principle

• The "more favourable rule" principle

• Doctrine of lex arbitri

• Reciprocity principle

Answer explanation

The "more favourable rule" principle under Article VII of the New York Convention enabled French courts to enforce the award based on French law, despite its annulment in Austria.

In the case of Nikolay Viktorovich Maximov v Open Joint Stock Company 'Novolipetsky Metallurgichesky Kombinat', what doctrine did the English High Court cite to deny enforcement of a Russian arbitral award that had been set aside?

• Doctrine of natural justice

• Ex nihilo nil fit ('nothing comes of nothing')

• Judicial neutrality

• Public policy exception

Answer explanation

The doctrine of ex nihilo nil fit, meaning "nothing comes of nothing," was used to argue that if the award was set aside, there was nothing to enforce.

What was one of the main reasons Judge Shumilina of the Moscow Arbitrazh Court set aside the award in the Maximov case?

• The arbitral tribunal acted against Russian public policy.

• The arbitrators were deemed independent and impartial.

• The award was in compliance with Russian law.

• The case was beyond the court’s jurisdiction.

Answer explanation

Judge Shumilina set aside the award partially due to public policy concerns, stating the arbitrators acted contrary to Russian law.

In Chromalloy Aeroservices Inc v. Arab Republic of Egypt, which legal doctrine was central to the U.S. District Court's decision to enforce an arbitral award annulled in Egypt?

• Doctrine of ex nihilo nil fit

• Lex arbitri

• Pro-enforcement bias of the New York Convention

• Forum non conveniens

Answer explanation

The U.S. District Court’s decision was influenced by the pro-enforcement bias of the New York Convention, supporting enforcement despite annulment at the seat of arbitration

In the Chromalloy case, what was the primary argument by the Arab Republic of Egypt against the enforcement of the arbitral award in the U.S.?

• The arbitral award violated U.S. public policy.

• The award was annulled by the Egyptian Court.

• The arbitration process lacked impartiality.

• The parties did not consent to arbitration.

Answer explanation

Egypt argued against enforcement because the award had been annulled by its courts, claiming that the annulment should be respected internationally.

How did the U.S. District Court justify enforcing the annulled Chromalloy award, contrary to the Egyptian court’s decision?

• By prioritising U.S. national interests over international comity

• By invoking a treaty between the U.S. and Egypt specifically governing arbitration

• By interpreting the New York Convention’s Article V as discretionary, allowing enforcement of annulled awards
  
  

• By arguing that the Egyptian court lacked jurisdiction over the case

Answer explanation

The U.S. District Court interpreted Article V of the New York Convention as discretionary, deciding to enforce the annulled award based on its own assessment.

In Chromalloy Aeroservices Inc v. Arab Republic of Egypt, what was the rationale for the U.S. court's support for the claimant, Chromalloy, despite the annulment?

• To uphold principles of fairness and impartiality

• To support U.S. policy favouring arbitration agreements and awards

• To encourage Egyptian legal reform

• To avoid jurisdictional conflicts

Answer explanation

The U.S. court’s support was based on a policy favouring the enforcement of arbitration agreements and awards, prioritising this over the annulment decision.