Polish Supreme Court order
dated 23 January 2013
Case No. I CSK 186/12
Summary by arbitraz.laszczuk.pl:
In 2007, a grain contract was concluded through commodities brokers between German company G. AG and Polish sole trader S.K., doing business as Przedsiębiorstwo Handlowe A.‑P. The contract provided for arbitration before the Grain and Feed Trade Association in London. In 2008, the GAFTA arbitration court issued an award in favour of G. AG against “A.-P.” for over EUR 285,000 for breach of contract.
G. AG then applied to the regional court in Poland for enforcement of the award against S.K. The applicant submitted inter alia a photocopy of the award, certified by the director general of GAFTA to be an authentic copy of the original award; the certification by the director general was notarised. In 2011, the regional court denied the application, without holding a hearing, on the grounds that the applicant had failed to present the original or an officially certified copy of the arbitration award as required by Art. 1213 of the Polish Civil Procedure Code.
The court of appeal denied the applicant’s interlocutory appeal, holding that the copy of the award was not “certified” for purposes of Art. 1213 of the Civil Procedure Code because it did not bear a seal or signature certifying the document, as the notarisation applied not to the contents of the award itself but only to the certification of the authenticity of the copy by the director general of GAFTA. The court further held that the alleged failure to present the original or a duly certified copy of the award was not a defect which the applicant could be summoned to cure, but that did not prevent the regional court from ruling on the merits of the application. Accordingly, the application had to be denied as unproved. The court held that a hearing on the application was required only for enforcement of the award, and no hearing was required for denial of enforcement.
On cassation appeal, the Supreme Court of Poland held that the requirement that a ruling “on” recognition or enforcement of a foreign arbitration award be issued after a hearing applies whether the ruling grants the application for recognition or enforcement or denies the application. Failure to hold a hearing on the application therefore rendered the proceeding invalid and required that the case be remanded to the regional court for reconsideration.
The Supreme Court also provided additional instructions for the regional court to follow upon reconsideration. The rules of the New York Convention, which the lower courts had ignored, should be given priority over the comparable provisions of the Polish Civil Procedure Code in order to determine such issues as the effectiveness of the arbitration clause. Because the award was issued in London, whether the copy of the award was “duly certified” for purposes of the New York Convention, and whether it was sufficient to identify the respondent by his trading name (“A.‑P.”) alone, without the sole trader’s own name (“S.K.”), should be determined according to English law.
The Supreme Court granted the cassation appeal accordingly, vacated the orders of the courts below, and remanded the case to the regional court for reconsideration.
Excerpts from the text of the court’s ruling:
1. Pursuant to Civil Procedure Code Art. 1215 §1, the court shall rule on recognition or enforcement of an arbitration award issued abroad or a settlement concluded before an arbitration court abroad after conducting a hearing. This provision confirms the rule provided for adversarial proceedings in Civil Procedure Code Art. 148 §1 that cases are considered at a hearing. A departure from this rule should be interpreted narrowly. Therefore, if a provision specifies the type of cases that are considered at a hearing, this method of consideration applies regardless of whether the court upholds the claim (or application) or denies it.
2. The [New York] Convention sets forth the material conditions for recognition (primarily in Art. IV and V), and therefore a proceeding for recognition of a foreign arbitration award should be conducted primarily in accordance with the provisions set forth in the Convention, and on the basis of the Civil Procedure Code in other respects not governed there.
3. The requirements with respect to the form of conclusion of an arbitration agreement should be assessed according to the [New York] Convention, and not according to Civil Procedure Code Art. 1162.
4. A liberal interpretation of [New York Convention Art. II(2)] is accepted in practice, recognizing that the enumeration therein of methods of concluding an agreement is not exhaustive, but also includes other techniques used for reaching agreement at a distance.
5. It should be accepted that the law of the state in which an arbitration award was issued should decide on the issue of certification of the contents of the award.
6. The view that failure to enclose the documents specified in Civil Procedure Code Art. 1213 with an application for recognition does not constitute a formal defect that is subject to supplementation pursuant to Civil Procedure Code Art. 130 §1 in connection with Art. 13 §2 is incorrect.
7. The respondent was not named in the arbitration award, but only the business name under which he trades was stated. The correctness and effectiveness of such identification should be decided by the law of the state of origin of the award.