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06 December 2018
In a recent decision, while addressing a question relating to the ritual or non-ritual nature of an arbitration clause, the Supreme Court of Cassation seized the opportunity to reaffirm that the decision of a judge on the validity and effectiveness of an arbitration clause for non-ritual arbitration is not appealable before the Supreme Court of Cassation on the grounds of lack of jurisdiction.(1)
Following a notice of objection against an injunction, the tribunal revoked the injunction after identifying that the original action should have been rejected as it was founded on an agreement which contained an arbitration clause for non-ritual arbitration.
Further, the tribunal stated that the specific written approval of the arbitration clause was not necessary as, following the negotiations between the parties, the rules provided with regard to general terms and conditions that were unilaterally drawn up by one party were not applicable.(2)
The losing party appealed the decision before the Supreme Court of Cassation on the grounds of lack of jurisdiction, claiming that:
First, the court confirmed the admissibility of the appeal before the Supreme Court of Cassation on the grounds of lack of jurisdiction, given that the arbitration clause provided for ritual arbitration, rather than non-ritual arbitration.(3)
Second, with regard to the merit of the question, the court declared the action admissible and well founded as, after stating that "the agreement was signed using forms unilaterally drawn up by one party", the court then pointed out the invalidity of the arbitration clause as it was not approved in writing.
In this decision, the court addressed the following questions:
As is well known, non-ritual arbitration differs from ritual arbitration with regard to its contractual and non-jurisdictional nature.
Indeed, although Article 824 of the Civil Procedure Code states that "the arbitration award has the effects of the decision delivered by a court as from the date of the last signing",(4) nothing prevents parties from establishing in writing and "derogating from what is provided for in art. 824bis", that "the dispute should be decided by the arbitrators by contractual decision".(5)
In this decision, the Supreme Court of Cassation affirmed through a literal interpretation of Article 808 of the Civil Procedure Code, that if parties wish to confer to arbitration proceedings that are contractual rather than jurisdictional this must specifically be confirmed in writing.
In the absence of this, the arbitration will be considered to be ritual and the rules provided for in Title VIII of Book IV of the Civil Procedure Code will apply.(6)
The qualification of arbitration as being ritual or non-ritual is not only relevant in the context of the legal nature of the proceedings, but also with regard to the procedural framework.
In this regard, the Supreme Court of Cassation, in accordance with previous case law,(7) stated that "the decision of the ordinary judge, which affirms or denies the validity and the effectiveness of a non-ritual arbitration… as the agreement of non-ritual arbitration implies the inapplicability of all the rules provided with regard to ritual arbitration, comprehensive of art. 819ter c.p.c." is not appealable before the court on the grounds of lack of jurisdiction.
This considering that the party which challenges the validity of an arbitration clause for non-ritual arbitration "does not put a question of jurisdiction of the ordinary judge… but challenges the admissibility of the question as the parties have chosen a consensual resolution of the dispute waiving the judicial protection".
Finally, through a literal interpretation of Article 808ter of the Civil Procedure Code the court affirmed that, with regard to agreements signed using forms unilaterally drawn up by one party, the will of the parties to confer to arbitration proceedings that are contractual rather than jurisdictional, must specifically occur in writing.
It is reasonable to consider that this general principle must be applied with regard to both ritual and non-ritual arbitration, as Article 1341(2)of the Civil Code generally refers to arbitration clauses, without addressing their nature.
For further information on this topic please contact Costanza Mariconda at Mariconda e Associati Studio Legale by telephone (+39 02 795 212) or email (email@example.com). The Mariconda e Associati Studio Legale website can be accessed at www.studiomariconda.com.
(2) Article 1341 of the Civil Code states: "In any case, the terms setting out, in favor of who has drawn up them […] arbitration clauses […] are not effective if not specifically approved in writing."
(4) Article 824bis of the Civil Procedure Code states: "Apart from what is provided for in art. 825, the arbitration award has the effects of the decision delivered by a Court as from the date of the last signing."
The parties may, specifically in writing, establish that derogating from what provided for in art. 824bis, the dispute should be decided by the arbitrators by contractual decision. Otherwise the rules of the present title should be applied.
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