Headnote

Arbitration – Enforcement – Foreign awards – New York Convention

Summary of facts

The Petitioner is a vessel owner who entered into vessel lease agreements with the Respondent in which they agreed to refer disputes arising from the agreements to arbitration in London.

After a dispute arose due to the Respondent’s failure to pay delay fines as per the agreements, the Petitioner referred the matter to arbitration. The arbitration was duly conducted in London by a sole arbitrator, who issued two awards against the Respondent. Since the United Arab Emirates and the United Kingdom are both signatories to the New York Convention of 1958 on the enforcement of foreign awards, the Petitioner sought an order enforcing the arbitral award issued in London on 15 February 2006 under the London Maritime Arbitrators Association (LMAA) Terms.

Held

It is a well-established principle in the UAE courts to refrain from reviewing the substantive merits of an arbitration award when hearing an action to recognise and enforce it.

Ratified treaties and conventions between the UAE and other states are applicable as internal legislation with respect to the enforcement of foreign arbitral awards, subject to national courts verifying that the necessary criteria are met before confirming any award.

Judgment

According to Article 212.4 of the Civil Procedure Code, the arbitral award shall be issued in the UAE; otherwise, the rules pertaining to foreign arbitral awards shall apply.

Article 215.1 of the Code states that an arbitral award shall not be enforced unless it has been ratified by the court with which it was filed after reviewing the award and the terms of reference and ascertaining that there is no impediment to enforcement.

It is a well-settled principle of judicial construction that the court shall not review the merits of the arbitral award when hearing an action to ratify it (Appeal No. 556 of 24, issued on 19 April 2005) and that ratified treaties and conventions between the UAE and other states are applicable as internal legislation with respect to the enforcement of foreign arbitral awards subject to national courts verifying that the necessary criteria are met before confirming any award (Appeal No. 764 of 24 issued on 7 April 2005 Hearing).

The New York Convention of 1958 on the Recognition and Enforcement of Foreign Arbitral Awards was ratified in the United Arab Emirates pursuant to Federal Decree No. 43 of 2006 with effect from 19 November 2006. The awards were rendered in the United Kingdom, which is also a signatory to the New York Convention of 1958.

Upon review of the arbitration clause and the two awards that form the subject of the ratification claim, the Court found that there is no impediment to the enforcement of the awards. The Respondent was summoned but no attorney appeared on its behalf to submit any objection, pleading or defence.

The Court accordingly granted the Petitioner’s claims and hereby recognised the awards.