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Consequences of the Breach of Arbitration Agreements

O AVTORJU
Dr. Simon Gabriel, LL.M, attorney at law, founder and partner of the Swiss arbitration boutique GABRIEL Arbitration. Simon studied law at the Universities of Berne (CH) and British Columbia, Vancouver (CDN). He holds a doctoral degree from the University of Lucerne (CH) and an LL.M. in advocacy from the University of Strathclyde (UK). He is admitted to the bar in Switzerland. Simon has been involved in more than 60 arbitration proceedings as party representative and arbitrator. - Dr. Nataša Hadžimanović, attorney at law, senior associate of the Swiss arbitration boutique GABRIEL Arbitration. Nataša studied law at and holds a doctoral degree from the University of Zurich (CH). She is admitted to the bar in Switzerland. Nataša has acted as party representative in international arbitration proceedings. Her recent cases have been on international sales of goods and interna-tional construction projects in the steel industry. Her practice focuses on South East Europe.
AVTOR
dr. Simon Gabriel in dr. Nataša Hadžimanović
SOAVTOR
TIP DOKUMENTA
Članki revije Slovenska arbitražna praksa
IZDAJATELJ
Gospodarska zbornica Slovenije; Stalna arbitraža pri Gospodarski zbornici Slovenije
NASLOV SEKCIJE
Arbitražni postopek
PUBLIKACIJA
Slovenska arbitražna praksa
ŠTEVILKA PUBLIKACIJE - ZAPOREDNO
15
NASLOVNA TEMA
Prispevek k razvoju arbitraže v Sloveniji
LETO
2017
POVZETEK
The present contribution focuses on the consequences of a party's breach of an arbitration agreement in international arbitration proceedings. The question whether or not monetary compensation can be awarded regularly arises in international arbitration practice and clear answers are rare in legal literature. Monetary compensation for breach of an arbitration agreement in pending arbitration proceedings requires that: (i) the arbitral tribunal has jurisdiction over the arbitration agreement; (ii) substantive parts of the arbitration agreement are affected; and (iii) new substantive claims can still be submitted in the pending proceedings. If the first requirement should not be fulfilled, a party may still be in a position to submit its claims before a state court. If the second requirement should not be fulfilled, a party may be limited to request procedural consequences (such as default), but no substantive relief such as damages. If the third requirement should not be fulfilled, a party may still be in a position to submit its claims in new arbitration proceedings. Against this background, every analysis on the consequences of the breach of an arbitration agreement should focus on the distinction between substantive and procedural parts of the arbitration agreement in the first place. Only substantive obligations may lead to substantive consequences such as monetary compensation. The present contribution proposes a test for this distinction and explains its application for the following three typical scenarios: (i) initiation of state court proceedings instead of arbitration, (ii) non-payment of the required advance on costs; and (iii) breach of confidentiality obligations.

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