The parties, both European companies, entered into an agreement (SPA) providing for the purchase by Claimant of Respondent's 100% shareholding in Company A, which was the sole owner of Company B. The agreement was governed by French law. At the time of the sale, Companies A and B were performing an engineering and construction contract that Company A had concluded with Company C (M project). Before provisional acceptance of the works, they were damaged by fire caused by the installation of defective gaskets. Company C claimed damages from Companies A and B. A settlement was reached and Claimant sought to recover from Respondent the amount it had paid under the settlement agreement on the ground that Respondent had breached representations and warranties made in the share purchase agreement. Respondent argued that the time limit for notifying claims relating to representations and warranties had expired. The arbitral tribunal found in favour of Respondent's defence, but was also required to address Claimant's argument that the SPA's provisions on timely notification of claims were made void by the fact that Respondent's breach of representations and warranties was a case of dol.

Les parties, deux sociétés européennes, avaient conclu une convention de cession d'actions (« SPA ») prévoyant l'acquisition par la demanderesse de la participation de 100 % de la défenderesse dans la société A, elle-même détentrice à 100 % de la société B. La convention était régie par la loi française. Au moment de la vente, les sociétés A et B exécutaient un contrat de construction et de génie civil que la société A avait conclu avec la société C (projet M). Avant la réception provisoire des travaux, ceux-ci ont été endommagés par un incendie dû à la pose de joints défectueux. La société C a réclamé des dommages-intérêts aux sociétés A et B. Un accord a été trouvé et la demanderesse, arguant que la défenderesse avait violé les déclarations et garanties de la convention de cession d'actions, a cherché à obtenir d'elle le remboursement de la somme qu'elle avait payée conformément à cet accord. La défenderesse soutenait que le délai de notification des réclamations concernant les déclarations et garanties avait expiré. Le tribunal arbitral a fait droit au moyen de défense de la défenderesse, mais devait également examiner l'argument de la demanderesse selon lequel le dol constitué par la violation par la défenderesse de ses déclarations et garanties rendait nulles les dispositions de la SPA sur la notification en temps utile des réclamations.

Las partes, dos empresas europeas, celebraron un acuerdo de adquisición de acciones («SPA») que establecía la compra, por parte del demandante, de la participación accionarial al 100 % del demandado en la empresa A, que era el único propietario de la empresa B. El acuerdo estaba regido por la ley francesa. En el momento de la venta, las empresas A y B estaban ejecutando un contrato de ingeniería y construcción que la empresa A había celebrado con la empresa C (proyecto M). Antes de la recepción provisional de los trabajos, estos sufrieron daños por un incendio provocado por la instalación de obturadores defectuosos. La empresa C reclamó daños y perjuicios a las empresas A y B. Se llegó a un arreglo y el demandante pretendió recuperar de la parte del demandado la suma que había pagado bajo el acuerdo de resolución alegando que el demandado había infringido las declaraciones y garantías estipuladas en el acuerdo de adquisición de acciones. El demandado adujo que el plazo para presentar las reclamaciones relativas a las declaraciones y garantías había expirado. El tribunal arbitral se pronunció a favor de la defensa del demandado, pero se requiere que el tribunal también aborde el argumento del demandante de que las disposiciones del acuerdo de adquisición de acciones sobre la presentación de las reclamaciones en tiempo oportuno quedaban sin efecto por el hecho de que la infracción de las declaraciones y garantías por parte del demandado constituía un caso de dolo.

'8. The time bar issue

8.1. The interpretation of Clause 7.5.1 of the SPA

151. The Parties' disagreement about the time bar stems from their different interpretation of Clause 7.5.1 of the SPA:

- the Claimant considers this provision to require that it gives notice within 60 days following receipt of a claim from a third party;

- the Respondent considers it to require notice within 60 days (or sooner if required) after a fact or matter becomes known and which may give rise to a claim under Clause 7.

152. Clause 7.5.1 of the SPA states as follows:

The Purchaser shall notify in writing the Seller within sixty (60) calendar days (or sooner if the matter requires) (i) from the date when the Purchaser or any of the Companies receives notice of any claim or demand or of any fact or matter which may give rise to a claim under Clause 7, or (ii) when no client or any other third party is involved, from the date when the Purchaser or any of the Companies becomes aware of a Breach.

If the Purchaser does not notify the claim to the Seller within such time limit, the Seller will be fully and irrevocably relieved to indemnify the Purchaser for the relevant claim.

The notice sent by the Purchaser shall be accompanied by reasonable relevant information and document(s) and shall mention reasonable relevant information relating to the Breach and the Damage as well as, as the case may be, any reasonable relevant information and documents relating to the third party claim.

. . . . . . . . .

173. In conclusion, the Arbitral Tribunal finds that Clause 7.5.1 requires

a) Early notification of claims under Clause 7: within 60 calendar days or sooner if the matter requires. The "requirements of the matter" have to be determined in relation to the circumstances of each case; e.g. if it relates to a matter of which the investigation requires assistance for the Seller, waiting 60 days may be negligent.

b) The starting point of the 60 days can be more or less precise: it can be the date on which the Purchaser became aware of a Breach or the date when he received notice either of a claim or of a fact which may give rise to a claim under Clause 7.

c) Failure to notify the claim under Clause 7 to the Purchaser within the time limit of 60 days relieves the Purchaser of his indemnification duty.

d) The notification covers not only the mere existence of a claim, demand, fact or matter or a Breach, but also all reasonable relevant information relating to it. What is "reasonable relevant information" has to be determined in relation to the facts.

8.2. The application of Clause 7.5.1 of the SPA

8.2.a. Timely notification

174. The Purchaser formulated its claim under Clause 7, for the first time, in a letter of its lawyer dated 25 January 2005. The letter notified the Respondent that [Claimant/Purchaser] had received advice of a claim from [Company C] under the Contract and that [Company C] alleged that the violent blast . . . which damaged [Company C's] plant was due to the "wilful misconduct" of [Company A]. It summoned the Respondent to indemnify the Claimant for the damages claimed by [Company C] from the Claimant in an amount of . . .

175. As stated above, the Purchaser could not wait to notify the Seller until it received an actual claim from a third party, but had to notify the Seller as soon as it, or [Companies A and B], became aware of a fact or matter which could give rise to a claim under Clause 7. This means that the starting point of the 60 day period for the notification was not merely the occurrence of an event but the Purchaser also had to have the knowledge that such an event might give rise to a claim against the Seller. Thus, this Arbitral Tribunal shall verify at what time the Purchaser or [Companies A and B] became aware of a fact susceptible of giving rise to a claim under Clause 7. The Arbitral Tribunal emphasizes that the mere possibility that a fact may give rise to a claim under Clause 7, is sufficient to trigger the 60 day period; the Seller could not wait until it was actually certain that it had a claim under Clause 7.

. . . . . . . . .

177. The Arbitral Tribunal comes to the conclusion that the Respondent was in a position to realize that, if not the accident itself or the discovery of its technical cause, at least the fact that [Company C] held [Company A] liable . . . could have triggered the awareness of [Company A] and its parent that they were confronted with at least "a fact or matter" if not a demand or claim which might give rise to a claim under Clause 7.

178. The Arbitral Tribunal situates the starting point of the "awareness" of the Claimant at the very latest between 11 and 22 November 2004, 11 November 2004 being the date on which the Claimant knew that the three gaskets which caused the fire were not the only ones to have been found defective, showing that there was a general quality problem at the site, and 22 November 2004 being the date on which it acknowledged through its behaviour that it knew that it would be held responsible for the accident.

179. It is clear, from the action which [Company A] undertook toward different insurers and brokers, towards its supplier of the gaskets and its subcontractor, and finally against [Company C] itself, that it was looking for any possible way to cover itself against the consequences of the incident . . . In that respect, it is surprising that it did not, as from 11 or 22 November 2004 or at the latest 60 days thereafter, i.e. 10 or 21 January 2005, notify a claim under Clause 7 to the Respondent, together with whatever information it had at that time.

180. There are no facts mentioned in the letter of [Company C's] lawyer of 15 January 2005 which [Company A] had not been aware of long before and the Arbitral Tribunal sees no reason why the Claimant chose to wait until it had actually received a claim from [Company C].

. . . . . . . . .

185. The Arbitral Tribunal thus comes to the conclusion that the Claimant was not founded in waiting until it had actually received a written claim from [Company C] to notify the Respondent, if not of the mere occurrence of the accident, at least of the findings of [the local health authority] and [the environmental protection agency] and of the Claimant's conviction that the wrong gaskets had been placed when [Companies A and B] were under the Respondent's control, and in any case of the fact that [Company C] held it responsible for the accident, which became very clear on 3, 11 and 22 November 2004 respectively - even if, until 3 November 2004, the Claimant might-somewhat naively-have thought that [Company C] would leave it alone if the plant was repaired quickly.

186. The negligence which the Claimant ascribes to the Respondent in terms of mismanagement and lack of on-site supervision and of covering up material information concerning the [Company C] contract, may or may not have constituted a Breach of the SPA, irrespective of whether [Company C] formulated a claim against the Claimant. The accident which resulted from these different forms of alleged negligence, caused the Claimant a Damage, under the SPA, irrespective of whether [Company C] formulated a claim against the Claimant or not. [Company C's] refusal to pay invoices and to place a new order with [Company A] which had been promised, as well as the administrative costs caused for the Claimant by the accident and its aftermath, were facts known to the Claimant, long before [Company C] formulated its demand against the Claimant. The explicit threats of both [Company C] and its CAR [Construction All Risk] insurer to hold the Claimant responsible were also a fact, prior to 22 November 2004.

187. Therefore, the Arbitral Tribunal decides that the Claimant's claim under Clause 7 is time-barred under Clause 7.5.1, unless, as will be discussed under chapter 9 hereafter, the alleged fraud (dol) of the Respondent renders, because fraus omnia corrumpit, the contractual notification regime inapplicable, as the Claimant has argued . . .

. . . . . . . . .

8.3. Conclusion

192. The failure to comply with the notification requirement is not a mere disrespect of a formality but has an impact on the substance of the claim and the rights it seeks to protect, to such extent that it justifies the sanction of inadmissibility of the claim.

193. Should the Claimant have given timely notice of the accident, which is the true basis of its claim under Clause 7, the Respondent would have had the opportunity to assist the Claimant in the investigations of the accident, the questioning of the employees of [Companies A and B], the dealings with the . . . insurers, and with [Company C]. Once the Respondent had been notified, the relevant evidence for the issue of the time at which the gaskets of improper size had been installed (in particular, whether this was at the time [Companies A and B] were under the Respondent's control or not) would possibly have been easier to trace and the Respondent might have assisted the Claimant in proving that the accident was the mere result of a human error which would have made the insurer's intervention less problematic than it now appears to have been.

194. The Arbitral Tribunal is therefore of the opinion that the inadmissibility of the claim of Claimant is not only the contractual, but also the just sanction for disrespect of Clause 7.5.1.

195. The Claimant has argued, though, that "when a 'dol' is involved, neither the contractual claims' notification regime nor the other conditions [……] stated in Clause 7 of the SPA shall apply".

196. The Arbitral Tribunal shall therefore review whether the Respondent has acted in a way that qualifies as dol as alleged by the Claimant. This necessary review of the behaviour of the Respondent during the negotiations of the SPA and during its performance, made it impossible for the Arbitral Tribunal to bifurcate the proceedings in order to first decide the sole question of the time bar (as had initially been suggested by the Respondent).

9. The issue of dol

197. Under French law, which is applicable to the SPA as mentioned above, where a party involved in a contract commits dol, the other party is entitled to claim full indemnification for the harm suffered. In particular, the liable party which committed dol can no longer rely on those provisions of the contract which are meant to protect its interests against a claim from the other party. In the instant case, should the Respondent be found liable of dol, it could not avail itself of the provisions of the Representations and Warranties in the SPA dealing with time limitation (or with a limitation of the recoverable amount of damages) to oppose Claimant's claim. In particular, dol would render inapplicable the time limitation stipulated in Clause 7.5.1 of the SPA.

198. The SPA itself refers to this principle, in Clause 5.1.2; it provides that "without prejudice of the possibility for the Purchaser not to proceed with the contemplated purchase of the shares in case of Material Breach by the Seller of obligations incumbent upon it pursuant to this Agreement or of wilful misconduct (dol), any breach made by the Seller will only give rise to an indemnification in accordance with Clause 7". It should be noted here that the concept of dol under French law does not correspond to that of wilful misconduct under English law. Since the parties agreed that the SPA be governed by French law, the Arbitral Tribunal is of the opinion, even if the expression "wilful misconduct" is followed by the French word dol in brackets, that it is the concept of dol that the Parties had in mind. Therefore, it is sufficient for the Arbitral Tribunal to examine only the effect of dol under French law in relation to those provisions of the SPA meant to protect the Seller's/Respondent's interests, and more particularly in relation to the time limitation, without having to examine the meaning and legal consequences of wilful misconduct in French law.

199. It is nonetheless important to point out that the concept of dol has two applications under French law. First, where a party lied or remained intentionally silent in relation to a key factor to the consent of the other party, thus leading the latter, unaware of such a factor, to enter into the contract, French law considers, as a matter of principle, that such a conduct vitiates the consent. Once proven, such a conduct entitles the victim to claim that the contract be declared null and void with possible indemnities, or alternatively to claim full compensation for the harm suffered because it concluded the contract not knowing the factor concealed by the other party. In such a situation, a dol is committed in the negotiation of the contract.

200. Second, where a party deliberately decides not to comply with its obligations under the contract and therefore accepts to cause harm to the other party, the liability of the first party cannot be excluded or limited. Thus, when the parties have stipulated clauses of exclusion or limitation of liability, such clauses may not apply. This is what French law considers dol in the performance of contractual obligations.

201. Both types of dol imply an element of intent, i.e. the will to deceive the other party in the negotiations or to deliberately breach one's contractual obligations, knowing that in both cases the other party would suffer damages.

. . . . . . . . .

9.2 The application of dol in the instant case

9.2.a. The issue is one of dol in the negotiation of the Contract

213. In the presentation of its arguments with respect to dol, the Claimant does not distinguish between dol in the negotiation of the contract and dol in the performance of a contractual obligation. On the contrary, the Claimant confuses the two applications of dol, as pointed out by the Respondent. Nevertheless, the Respondent itself mixes up the two applications of dol. Indeed, in its Statement of Defence and again in its Rejoinder, the Respondent alleges that the sole possible remedy for dol in the performance of contractual obligations is the right not to proceed with the purchase of the shares. Yet, the Respondent acknowledges that such a right is effective only when the dol has been committed by the Seller in the negotiation of the contract.

214. The Arbitral Tribunal notes, however, that the Respondent's argument is not correct in two ways. First, the right not to conclude the contract cannot possibly be the sanction for a dol committed in the performance of one's contractual obligation. The only possible sanction for dol in the performance of obligations is indemnification. Second, when a dol has been committed in the performance of contractual obligations, the contractual limitations of liability (time limitation or a cap on indemnification) are not applicable. This is a rule of public policy in French law. For these reasons, the Respondent's arguments are irrelevant, more particularly the argument that the Claimant's sole remedy was not to sign the contract.

215. The Arbitral Tribunal is also of the opinion that, in the instant case, it is necessary to opt either for the dol in the negotiation or the dol in the performance of the contractual obligations, even if both types of dol oblige its author to compensate the damage suffered by the victim and make it impossible to rely on the time bar provisions under Clause 7.5.1 of the SPA. However, the reasons why the dol leads up to these consequences are not the same.

216. Where the dol is a vice du consentement, the contract is not valid and the party which has suffered the harm is entitled to invoke the nullity of the contract or obtain full compensation, since the contract can no longer meet its expectations. Where the dol is committed in the performance of obligations, the other party is entitled to seek indemnification by ignoring the limitations of liability under the contract.

217. The Claimant's assertion regarding the assimilation of gross negligence or wilful misconduct and dol is correct as regards dol in the performance of contractual obligations. However, such an assimilation is irrelevant as regards dol in the negotiation of a contract. Therefore, the assimilation of the consequences of gross negligence to those of dol has nothing to do with a dol committed in the negotiation of the contract.

218. Since both Claimant and Respondent have mixed up the two applications of dol, the Arbitral Tribunal, taking into consideration the factual and legal grounds of this case, has to decide whether the Claimant has based its claim upon dol in the negotiation or dol in the performance of obligations. It appears undoubtedly that the Claimant has opted for the dol in the negotiation, even if it contradicts itself by also alleging dol in the performance of obligations. If that choice is not expressly mentioned in the Claimant's submissions, it is consistent with its presentation of the facts, as examined above. Indeed, the facts put forward by the Claimant sufficiently demonstrate that the claim for dol is consistent with dol in the negotiation and not with dol in the performance of obligations.

219. In its Statement of Claim, the Claimant expressly points out that the Respondent, at the time of the negotiation of the SPA, failed to disclose to the Claimant crucial facts. More precisely, the Claimant alleges that "the conduct of [Respondent] in negotiation of the SPA and in giving the Representations and Warranties qualifies as a dol". Even if, in the same submission, the Claimant also refers to dol in the performance of its obligations by the Respondent, the real basis for the Claimant's claim in dol lies in the non-disclosure of key information by the Respondent to the Claimant as a result of which it finds that the Representations and Warranties under the SPA are not consistent with reality. Therefore, the Arbitral Tribunal is of the opinion that the claim for dol is actually based upon dol in the negotiation but not in the performance of obligations.

. . . . . . . . .

222. The Arbitral Tribunal emphasizes that the confusion between dol in the negotiation of the contract and dol in the performance of the contract is typical in this case where the parties have used, in a contract governed by French law, and hence subject to the rules on the vice de consentement, (i.a. dol), the Anglo-Saxon techniques of (a) allowing the Purchaser to perform a due diligence and (b) having the Seller give "Representations & Warranties" to the Purchaser. It is a fact that the due diligence impacts on the information duty of the Seller and the Purchaser's obligation "to beware", which are well known concepts in French law. Moreover, the "Representations & Warranties" "contractualize" the right of the Purchaser to be told the truth: the Seller guarantees the truth of the Representations and gives Warranties in respect to them. This does not mean, however, that when Representations and Warranties are being given, there cannot be dol in the negotiation of the contract.

223. The Arbitral Tribunal thus being justified in understanding the Claimant's claim in dol as being based upon a dol in the negotiation of the SPA, the Arbitral Tribunal shall now examine whether the requirements of a dol in the negotiation of the contract are met in the instant case.

9.2.b. Was there dol in the negotiation of the Contract?

224. Although French courts have sometimes interpreted a dol in a lax way, several decisions of the French Supreme Court in recent leading cases have insisted that dol as a defect in consent exists only if the following two conditions are fulfilled.

225. The first condition is the intent of a party to deceive the other party. The core of the condition is the existence of bad faith amounting to an intent to harm the other party. Bad faith may consist of lying (dol par commission) or of remaining silent, i.e. by retention of information (dol par réticence). In a leading case of 28 February 2005, the Cour de Cassation ruled that "le manquement à une obligation précontractuelle d'information, à la supposer établie, ne peut suffire à caractériser le dol par réticence, si ne s'y ajoute la constatation du caractère intentionnel de ce manquement " (R.J.D.A 2005, no. 1314). In other words, the party which has to inform the other party only commits a dol if it acts with the intent to deceive that other party.

226. The second condition is that the dol relates to an element which is crucial for the other party's consent to the agreement, in such a way that the latter would not have entered into the contract if it had been aware of these facts or would have done so only on different terms and conditions.

227. The burden of proof that the two conditions of dol are fulfilled lies on the party which alleges dol. The courts appreciate the existence of dol in the light of all the circumstances. The evidence that information has been withheld, is not sufficient to conclude that a dol exists. The Arbitral Tribunal will review hereafter (i) the facts which were allegedly hidden from the Claimant by the Respondent, (ii) whether they were hidden intentionally (first condition of dol) and (iii) whether they concerned a decisive element for the conclusion of the contract (second condition of dol).

(i) Evidence of deficiencies in the organization of the [M] project

228. In its Statement of Claim, the Claimant refers to several documents with regard to the [M] project and in particular regarding the deficiency of the subcontractor . . . The Claimant produces documents that "show that, despite numerous meetings and reminders, [Company A]'s projects rules were not followed" . . . and that refer to the deficiencies of the [M] project.

. . . . . . . . .

231. After the accident . . ., [Company C] also denounced many poor standards in the organization and the realization of the [M] project. Moreover, the report of the [local health authority] after the accident clearly mentions the breach of safety rules which may be considered as the cause of the accident . . .

232. The examination of the witnesses during the hearing . . . confirmed that the project was disorganized and badly coordinated.

233. It is certain that the organization at the site and the conduct of the works of the [M] project have not been satisfactory. Undoubtedly, the [Company A] managers did not adequately comply with their duties and the report of the [local health authority] after the accident sufficiently corroborates this. Therefore, one can suppose with some degree of certainty that the lack of organization in the conduct and the management of the works can be considered as the cause of the accident . . . From this point of view, had the Claimant, first, not been time-barred and, second, been able to prove that the installment of the wrong gaskets had been made prior to the date of the transfer of the shares of [Company A] to [Claimant] . . . it could have possibly claimed on the basis of the Representations and Warranties subject to meeting the related requirements and in particular proving that the Seller was aware of the disorganization of the site. However, the Arbitral Tribunal has not to decide whether or not these requirements are met, since the claim is time-barred under the Representations and Warranties. The claim for dol is absolutely different from a claim for breach of the Representations and Warranties. Indeed, the Claimant must prove that the Respondent had the intent to harm at the time of the negotiation of the contract.

234. The next question is to which extent the Respondent was aware, at the time of negotiation of the SPA, of the disorganization at the [M] site. In this respect, the "Rapport de fin de projet" . . ., the oral testimonies and the findings of [the local health authority] made after the accident, are irrelevant. Only documents and facts from the negotiation period have to be considered in order to determine whether dol was committed by the Respondent in the conclusion of the SPA.

(ii) Evidence of intention to hide relevant facts which were essential for the Claimant's consent to the SPA

235. The Respondent has argued, first, that meetings had been organized between representatives of [Claimant], [Respondent] and [Company A] and, second, that [Claimant] had performed a due diligence process. According to the Respondent, the discussions between the representatives of the companies involved in the transaction have permitted [Claimant] to know exactly what was the situation at the site of the [M] project . . . Representatives of [Claimant] visited the site and therefore could have checked the situation . . . Moreover, in the amendment . . . to the SPA, [Claimant] accepted to "take all the full risks and rewards on all ongoing projects". Certainly, such a provision of the contract does not prevent to claim dol if the Respondent had not disclosed to the Claimant key factors with respect to the project; however, in accordance with the principles governing the burden of proof, the Claimant has to prove that the Respondent had hidden these factors so as to obtain the consent of the Purchaser to the contract. Concerning the due diligence, the Respondent considers that the Claimant had a full awareness of the situation of [Companies A and B] and more particularly [Company B] and, therefore, the [M] project.

236. The Arbitral Tribunal has carefully reviewed the reports and emails . . . filed by the Claimant . . . The Arbitral Tribunal considers Exhibits . . . as evidence that the [Company A] management was aware of the organizational problems of the [M] project . . .

237. However, the Representation of the SPA on which the Claimant relies in this respect reads as follows:

3.2. To the Knowledge of the Seller, the Companies and, with respect to their respective Assets and businesses, their officers and Employees (a), have complied with all Rules and (b) have all required Authorizations to own or use their Assets for the carrying out of their activities as presently carried out. No new or additional investments or action is required to be taken or necessary in order to comply with any applicable Rule in particular, without limitation, in the areas of health, safety and environment. . . .

Therefore, for this Representation to be breached, and certainly for dol of the Respondent to be proven, it is necessary to prove that the Seller, i.e. the Respondent, knew that [Companies A and B] had not complied with all rules. That the management of [Company A] in France was aware that the company's rules were not followed, is in itself irrelevant. The Arbitral Tribunal does not have to deal with the question whether [Companies A and B's] own procedures and best practice rules-which existed but were not applied in [M]-constitute Rules as defined in Exhibit A to the SPA and whether, hence, the disorganization-of the [M] Site can constitute a breach of this Representation. The sole question at the moment is what the Respondent did know about the organization of the [M] project, when it negotiated the SPA.

238. A due diligence process had been started . . . [Company A] informed the Claimant of its intention to send it two-weekly summary reports providing information on projects, and monthly Executive Management Reports and Management Committee Meeting Reports . . . There is no evidence in the file that the Claimant has requested other information or that the Respondent would have refused to give any other information if required or that the Claimant thereafter ever complained of not having enough information.

239. Moreover, a data room had been created. Not all documents in the data room have been produced in this arbitration and the Arbitral Tribunal ignores whether the above mentioned reports . . . were in it. In any case, the Claimant has not proven, or alleged or complained that they were not there.

240. What the Data Room Index . . . does show, is that the Claimant has received in this period at the end of each month an Executive Summary Report and Accounting Sheet and/or Executive Management & Management Committee Reports for all ongoing projects . . . the mention of the monthly Executive Summary Reports in the Data Room Index confirms that the Claimant had, before signing the SPA, the figures in which it reads now the evidence of "the lack of control of the works on site".

241. In any case, the Data Room Index as well as Exhibit . . . which explicitly mentions "Delays in construction work. Mechanical subcontractor does not meet the programme required for timely completion in the field" show that there was quite some transparency from the Respondent to the Claimant.

242. That the Claimant has received plenty of information from the Respondent, is also shown by the internal report of . . . the Claimant . . .

. . . . . . . . .

247. The Arbitral Tribunal acknowledges that the Claimant had a considerable burden of proof:

(i) in relation to its defence against [Company C's] claims for damages

(ii) in relation to its claim against [the subcontractor] for its possible role in the cause of the accident

(iii) in relation to the bad faith of the Respondent when concluding the SPA,

but is at a loss to explain why, even with the possible help of [Company A's Deputy General Manager], it was unable to produce convincing evidence in any of these three areas.

. . . . . . . . .

249. Coming back to the accident . . ., the Arbitral Tribunal-as mentioned above-could accept, on the basis of the evidence before it that the deficiencies in the organization and management of the works indirectly caused the accident . . .

250. However, it follows from the testimonies of [the parties' witnesses] that such deficiencies frequently occur in the realization of projects of such importance as the [M] one. Even if some deficiencies at the site could be considered tantamount to gross negligence, more especially the installment of the wrong gaskets, by no account would this amount to dol. First, it has not been shown that any of the [Companies A and B] management was aware of the wrong installation. Second, but equally important, the Claimant has not convinced the Arbitral Tribunal that the wrong gaskets have been installed by [Company A] or its subcontractor . . . before the transfer of the shares and of the management of [Companies A and B] to the Claimant.

251. Above all, the crucial fact which caused the Claimant to claim, is the accident . . . Without the occurrence of that accident, the Claimant would not likely have claimed for compensation. If, as seen above, it is obvious that there was a negligent behaviour which caused the accident, it arises from the arguments raised by both Parties and, above all, from the testimonies at the hearing . . . that nobody knows at what time the wrong gaskets were installed . . .

. . . . . . . . .

254. Several documents have been submitted in these proceedings by the Claimant as proposed evidence that the wrong gaskets had been installed while [Companies A and B] were still the Respondent's property. The Arbitral Tribunal has carefully reviewed these documents and found no such evidence. The Arbitral Tribunal is puzzled by the lack of this evidence and fails to understand how, after the Claimant was involved in legal proceedings against [Company C] as well as against its subcontractor . . ., it is possible that the date/period circumstances of the installation of the wrong gaskets . . . are still entirely unknown. . . .

255. It follows from the above testimonies and from the documents on file, first, that it is not known at what time the wrong gaskets were installed; second, that, had they been installed prior to [the date of the transfer of the shares to Claimant], it would have been normal to check for the existence of wrong gaskets at the time of the mechanical completion or commissioning, which both took place after the acquisition of [Companies A and B] by [Claimant]; third, that the disorganization at the site which is presumably the cause of the installation of wrong gaskets or of the failure to replace them by good ones, existed both before and after the acquisition by [Claimant].

256. Therefore, in the opinion of the Arbitral Tribunal, the Claimant cannot successfully argue that the Respondent hid from the Claimant that the site was disorganized. In any event, the Arbitral Tribunal cannot admit the existence of a dol on the part of the Respondent since the first requirement of dol is not met, as there is no evidence that the Respondent had the intent to deceive the Claimant by not disclosing the disorganization of the [M] project.

(iii) Evidence of dol concerning a decisive factor for the conclusion of the Contract

257. Dol must meet a second condition which consists of the intent to deceive in order to convince the other party to enter into the contract. The 28 February 2005 decision of the French Supreme Court (see § 225 above) also discusses this requirement; it states in particular that dol must materialize into an error which is decisive, i.e. without such an error, the other party would not have entered into the contract or would have done so under different terms and conditions ("une erreur déterminante provoquée par le dol").

258. In the instant case, the purpose of the SPA was the acquisition of [Companies A and B]. The activity [Company B] was certainly important to the Claimant because the contract with [Company C] represented a substantial part of the business, but it seems that the [M] project was not the ultimate purpose of the transaction between the Parties. It does not necessarily follow that even if the Claimant had been aware of the disorganization of the [M] project, it would not have purchased the shares under the terms and conditions of the SPA.

259. In this respect, it is relevant that the Claimant, in its Proposed Acquisition Executive Summary which it drafted on basis of the due diligence which it had performed . . . wrote that "Company [i.e. [Company A]] management believes there is no risk in any of these two projects. Nevertheless, [Claimant] management believes and estimates that there is some exposure and we will have to give these projects our management's attention" . . . The [M] project was also specifically looked at from an insurance point of view . . . This report thus shows that the Claimant, notwithstanding its awareness of the existence of risks, chose to go forward with the deal.

260. It is also relevant that some disorganization at the site continued after the acquisition of [Companies A and B] by the Claimant, which the latter cannot have ignored once it had acquired [Companies A and B]. Nevertheless, the Claimant did nothing to remedy that situation: the testimonies at the hearing revealed that the [Company A] storekeeper left the site in May and was never replaced . . . Even if the role of the storekeeper is not necessarily relevant after mechanical completion . . . it is a fact that his absence made it possible to take spare parts out of the stock, or to take the wrong parts. The testimonies also referred to defective supervision both during construction and in the commissioning period, i.e. not only before but also after the acquisition . . . The Claimant did not implement measures to improve the organization of the site. Had the state of deficiency been crucial to the Claimant, remedial measures would have been implemented. There is no evidence whatsoever that this was done.

261. Therefore, the Arbitral Tribunal is of the opinion that, even supposing that the first requirement of dol had been met, the second requirement is lacking.

262. In conclusion, the Arbitral Tribunal holds that no dol has been committed by the Respondent in the negotiation and conclusion of the SPA. As a consequence, the Respondent can avail itself of the time bar provisions under Clause 7.5.1 of the SPA.

263. The claim of the Claimant is therefore time barred.'