- Arbitral Award
- ICC International Court of Arbitration
- Société mixte Franco-Kazakh CISTM v. Société FORASOL
CATERING SERVICE CONTRACT - BETWEEN A FRENCH COMPANY AND A FRENCH-KAZAKH COMPANY - FRENCH LAW APPLICABLE
NOTICE OF CANCELLATION OF CONTRACT - FRENCH LAW UNCLEAR AS TO WHETHER DISPATCH OR RECEIPT PRINCIPLE APPLICABLE - REFERENCE TO USAGES OF INTERNATIONAL TRADE (ART. 13(5) ICC RULES OF ARBITRATION) ACCORDING TO WHICH RECEIPT PRINCIPLE APPLIES - REFERENCE TO UNIDROIT PRINCIPLES
Defendant, a French company in charge of perforation activities in Kazakhstan had entered into a contract with Plaintiff, a mixed French-Kazakh company for catering services for its employees. The contract, which was governed by French law, had a fixed term but provided for tacit renewal in the absence of notice of cancellation by Defendant three months before expiry. Two days before the three month period began to run, Defendant sent a notice of cancellation to Plaintiff, which however reached the latter two days after the three month had begun to run. Defendant, invoking Articles 668 and 669 of the French Code of civil procedure according to which in case of notice the date of postage was decisive, argued that its notice of cancellation had been given to Plaintiff in time. Plaintiff object that the notice was neffective because it should have reached it before the three month period had begun.
The sole arbitrator decided in favour of Plaintiff. It held that in the case at hand Articles 668 and 669 of the French Code of civil procedure were not applicable because they related only to notices given in the course of judicial proceedings. Since with respect to notices exchanged in contractual relationships there was no clear rule in French law as to whether the dispatch principle or the receipt principle prevailed, the Arbitrator, on the basis of Article 13(5) of the ICC Rules of Arbitration, referred to the usages of international trade and found that according to them it was the receipt principle that was generally accepted. In this context the Arbitrator referred to the UNIDROIT Principles, indicated as a "codification" of such usages, without however citing Article 1.9(2) [Art. 1.10(2) of the 2004 edition] which expressly sets out the receipt principle.
Cour d'Appel de Paris (1er Ch. C.) 5 March 1998 in Revue de l'Arbitrage, 1999, p. 86 et seq.}}