Headnote

Arbitration – Content of award

Summary of facts

The Petitioner filed an action against the Respondents before the Dubai Court of First Instance, requesting the Court to confirm the invalidity of two agreements dated 14 August 1995 and 2 October 1995 and to order the Respondents to refund the amount of AED 1,785,048 in addition to legal interest. Additionally, the Petitioner requested the Court to appoint three arbitrators to settle the dispute.

On 29 July 1998, the Court decided to appoint three accounting experts to act as arbitrators in the dispute arising between the Petitioner and the First and Second Respondents regarding the agreement dated 14 August 1995.

Furthermore, the Court dismissed the invalidation request presented with respect to the agreement dated 14 August 1995 on the grounds that the agreement provided for arbitration in case of disputes between the parties under the agreement.

After the arbitrators issued their award, the Petitioner requested the Court of First Instance to ratify the award whereas the first Respondent objected to this request.

On 28 September 1999, the Court of First Instance decided to ratify the arbitration award only against the second Respondent and ordered said Respondent to refund to the Claimant Petitioner the amount of AED 968,656 in addition to legal interest.

However, this judgment was appealed by the Respondents, who requested the Court to annul the interlocutory judgment and the award.

On 27 February 2000, the Court of Appeal decided to annul the award. The Petitioner challenged the Court of Appeal’s judgment.

On 24 September 2000, the Court of Cassation decided to overturn the challenged judgment, on the basis that the presence of the signatures of all arbitrators on the arbitration minutes is not a prerequisite for the validity of the award, and remanded the case to the lower courts. On 18 February 2001, the Court to which the case was referred annulled the appealed judgment. Once again, the Petitioner filed a petition to cassation.

Held

The judgment was overturned and the case remanded to the lower courts.

According to paragraphs (1) and (5) of Article 212 of the Civil Procedure Code, and as established in the adjudication of this Court, the lawmaker did not stipulate that the award should include all data that must be included in court rulings. Rather, the lawmaker has stipulated that provisions related to arbitration and mentioned in Chapter 3 of the Civil Procedure Code must be fulfilled, including the abovementioned paragraph (5) of Article 212. According to this article, the award must include a copy of the arbitration agreement. The basic purpose of this condition is to verify that the award is given within the limits of the arbitrators’ competence and authority extracted from the arbitration agreement. The award shall include a copy of this agreement, even if a copy of the agreement or the original thereof is to be submitted to the Court during the consideration of the dispute. It is not necessary to mention the exact provisions of the arbitration agreement: the purport thereof shall be sufficient so long as no alteration is made to its meaning.

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Judgment

It is established from the award, which forms the subject matter of the present dispute, that it included a summary of the clauses of the agreement dated 14 August 1995, as well as the arbitration clause referred to therein. Hence, the award is deemed to have fulfilled the condition contemplated under Article 212 of the Civil Procedure Code.

As the challenged judgment was passed in contradiction of the above and concluded that the said award did not include a copy of the arbitration agreement, it is invalid. Said judgment shall therefore be deemed to have been passed in contradiction to the facts established by case papers and shall be overturned. As the result reached by the challenged judgment precluded verification that the said award was passed within the limits of the authority conferred upon the arbitrators by the arbitration agreement, the Court, in addition to overturning the challenged judgment, as mentioned above, decides to remand the case to the lower courts to reconsider the issue, with no need to investigate other grounds of the present petition to cassation.

Accordingly, the judgment is overturned and the case is remanded to the lower courts.