Decision of the Svea Court of Appeal, 22 November 2013, Case No. Ö 3912-13
Summary: The claimant applied for the recognition and enforcement in Sweden of a foreign award rendered under UNCITRAL Arbitration Rules under the auspices the International Centre for Dispute Resolution (ICDR). ICDR dispatched to the respondent letters informing on the appointed arbitrators, summons to a preparatory meeting, that no main hearing would take place, and that an award had been rendered. ICDR sent the documents by e-mail, Federal Express (FE) and in one case by recommended letter. The claimant submitted an application to affirm the award in the Connecticut District Court. During these proceedings, documentation was sent to the respondent via FE and receipt of the letters was signed by other individuals, including the wife of the respondent, but not by the respondent. The claimant sought enforcement of the award in Stockholm. The respondent resisted enforcement alleging that it was not aware of the arbitration, as it didn’t receive the letters. Section 54(2) of the Swedish Arbitration Act provides that recognition or enforcement of a foreign award can be denied if the party against whom the award is invoked was not given proper notice of the appointment of the arbitrator or of the arbitration proceedings, or was otherwise unable to present his case. The Svea Court of Appeal explained that high standards apply to communications at the commencement of the arbitration and it’s required that the communication actually reaches the addressee. If it’s not clear from the arbitral award or from another source that the communication reached the addressee or if the counterparty during the proceedings for recognition and enforcement presents evidence that gives rise to considerable doubt as to whether it received the communication, then according to Section 54(2) SAA it’s not possible to enforce the award, unless it’s established that the counterparty was able to present its case. The Court explained that the fact that letters have been dispatched cannot generally be taken as proof that the addressee actually received the letters, although the sending of the letters is strong evidence that they reached the addressee. With reference to Supreme Court case NJA 2007 p. 157, the Court explained that if a party sends several letters, the possibility that not at least one of those reached the addressee must be deemed negligible, unless particular circumstances in support thereof are at hand. Here, the award did not provide that the respondent had received notice of the commencement of arbitration. The Court found that it was clear that the documents were dispatched, but the enforcing party failed to provide evidence that the documents had been received. The three letters were sent in a time span of two and a half months from New York to Stockholm. Considering the high standards with respect to evidence, the Svea Court found that this involved so few letters that only evidence in support of the dispatch cannot be accepted as proof of receipt by the addressee. The Court considered that it was not established that the respondent had received the letters and thereby the respondent was not able to present its case. That the letter following the arbitral award could be deemed as received didn’t affect this conclusion. The Court denied recognition and enforcement of the award.
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Court of Appeal
Case No. Ö 3912-13
Rejection of recognition and enforcement of foreign award; party’s right to present its case.