- Arbitral Award
- Internationales Schiedsgericht der Wirtschaftskammer Österreich
DISPUTE BETWEEN TWO EUROPEAN COMPANIES
ARBITRATION - POWERS OF ARBITRATORS DERIVING FROM CONTRACT BETWEEN PARTIES AND ARBITRATORS - REFERENCE TO UNIDROIT PRINCIPLES IN SUPPORT OF THE SOLUTION ADOPTED UNDER APPLICABLE DOMESTIC LAW (LAW OF A EASTERN EUROPEAN COUNTRY)
PERFORMANCE OF CONTRACT - PARTIES' DUTY TO ACT IN GOOD FAITH (ARTICLE 1.7(1) UNIDROIT PRINCIPLES)
Claimant, a European company, sought to obtain a statement to the effect that it had validly exercised a call option when Defendant, another European company, had disposed of its shares in a joint venture contrary to the Shareholders' Agreement. The law governing the substance of the dispute was the law of an Eastern European country and the lex arbitri was Austrian law.
When the question arose as to whether the memorials and exhibits filed in the proceeding at hand could be disclosed in a parallel arbitral proceedings, the Arbitral Tribunal decided in the negative pointing out that the expectations of the parties to the first proceedings had to be protected and any collusion between the parties to the two proceedings avoided. The Arbitral Tribunal held that the powers of arbitrators derive from the contract between the parties and the arbitrators, and that contracts are to be performed in good faith under both the law governing the substance of the dispute and the lex arbitri. In this context the Arbitral Tribunal also referred to Article 1.7 (1) of the UNIDROIT Principles of International Commercial Contracts  according to which ”Each party must act in accordance with good faith and fair dealing in international trade”, and quoted M.J. Bonell, An International Restatement of Contract Law, 3rd ed. Ardsley N.Y. 2005, 128 with citations in fn. 105, pointing out that the principle has met with approval in numerous arbitral awards and court decisions.