Louis Flannery salutes a “fresh start” in arbitration
In a judgment that will undoubtedly be extremely well received by the international arbitration community, the House of Lords in Fiona Trust Holding Corp and others v Privalov and others [2007] UKHL 40, [2007] All ER (D) 233 (Oct) has given an unqualified endorsement to the idea of arbitrators deciding upon their own jurisdiction, even in cases where one party to the contract alleges it was procured by fraud and bribery. The law lords unanimously dismissed an appeal from the Court of Appeal’s judgment in January (see NLJ, 13 April 2007, pp 508–09).
BACKGROUND
The contracts here were time charterparties. It was alleged by the shipowner-claimants that the charters had been procured by bribery of the claimants’ former personnel. Proceedings were started in the High Court against the charterers, seeking inter alia declarations that the time charters had been validly rescinded.
Although the charters were subject to the jurisdiction of the English courts, either party had the right to elect to refer any dispute to arbitration
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