'Interest claimed by Claimants

The question which the Arbitral Tribunal has to answer is as follows:

Should interest be awarded on Claimants' claim whereas such relief ("Claimants respectfully request: (1) damages […], plus interest at a rate to be established by the Tribunal 1 calculated from June 1, 1998") was submitted for the first time in the post-hearing brief filed by Claimants . . . ?

. . . . . . . . .

Procedure

The Terms of Reference provide as follows:

"The procedure shall be that prescribed by the Rules of Conciliation and Arbitration (edition 1998) of the ICC and, when these Rules are silent about any issue, the procedure shall be determined by the Arbitral Tribunal subject to the mandatory provisions of Articles 176 to 194 of the Swiss Private International Law Statute."

The 1998 ICC Rules of Arbitration do not contain any express provision on interest.

However, the question arises whether the claim for interest which Claimants filed at some stage of the proceedings falls within the scope of application of Article 19 of the ICC Rules of Arbitration, which reads as follows:

"After the Terms of Reference have been signed or approved by the Court, no Party shall make new claims or counterclaims which fall outside the limits of the Terms of Reference unless it has been authorized to do so by the Arbitral Tribunal, which shall consider the nature of such new claims or counterclaims, the stage of the arbitration and other relevant circumstances."

The concept of "new claims" is not defined in the ICC Rules 2 and the issue of interest on a damages claim is not specifically addressed by the commentators of the ICC Rules. Therefore, the Arbitral Tribunal should first determine:

(i) whether Claimants' claim for interest is to be considered as a "new claim" within the meaning of Article 19 of the ICC Rules; and

(ii) whether such claim is outside the scope of the Terms of Reference.

An analysis of the ICC case law shows that an increase in the amount of a claim after the signing of the Terms of Reference is usually accepted by arbitrators, who do not consider that it constitutes a new claim.3

One can therefore submit that, in view of its true nature, which is entirely linked to the main claim for damages, a claim for interest should not be considered as a "new claim" under Article 19 of the ICC Rules. This is simply a way to supplement the main claim, as a sort of increase of the amount in dispute and no difficulties would therefore arise in the light of Article 19 of the ICC Rules.

Such claim for interest should consequently be admitted even when it is submitted at a late stage during the proceedings, provided that the main claim for damages has been filed before the signing of the Terms of Reference as is the case here.

Regarding the question whether the claim for interest falls outside the limits of the Terms of Reference, it should be noted that interest hasnot been mentioned in the Terms of Reference among the specific issues to be determined by the Arbitral Tribunal. Yet Respondent, for its part, sought interest in its prayer for relief and such relief could have been mentioned in the Terms of Reference as an issue to be considered. The fact that interest has not been addressed in the Terms of Reference is due to the understanding of the Arbitral Tribunal that such an issue is encompassed by the main issues to be decided, that is the claims for damages, which have been mentioned in the Terms of Reference.

Commentators point out that some arbitrators have broadly construed the scope of the Terms of Reference so as to include new claims which were in connection with the main claims already filed.4

It is therefore the Arbitral Tribunal's conclusion that a claim for interest does not fall outside the limits of the Terms of Reference.

In conclusion Claimants' claim is not a "new claim" within the meaning of Article 19 of the ICC Rules and it is not outside the scope of the Terms of Reference.'

1
In their Post-Hearing Reply Brief . . . Claimants amended the relief sought as far as the rate of interest is concerned as follows: "Claimants respectfully request (1) damages […], plus 5% Swiss legal interest calculated from June 1, 1998".

2
Reiner, ICC Schiedsgerichtsbarkeit, Ein Handbuch für die Praxis, Vienna 1989, p. 177.

3
Reiner, L'acte de mission: le rôle de la Cour internationale d'arbitrage et l'application de l'article 16 par les arbitres, Bulletin de la Cour internationale d'arbitrage de la CCI, vol. 7/no 2, December 1996, p. 60 et seq., 68; Schäfer/Verbist/Imhoos, Die ICC Schiedsgerichtsordnung in der Praxis, Bonn 2000, p. 132.

4
Derains/Schwartz, A Guide to the New ICC Rules of Arbitration, The Hague [etc.] 1998, p. 250. See also Reiner, L'acte de mission: le role de la Cour internationale d'arbitrage et l'application de l'article 16 par les arbitres, Bulletin de la Cour internationale d'arbitrage de la CCI vol. 7/no. 2, December 1996, p. 60 et seq., 70-71, who cites cases where new claims were admitted since they had a "close connection" with the original claim.