- Arbitral Award
- International Arbitration Court of the Chamber of Commerce and Industry of the Russian Federation
SALES CONTRACT - BETWEEN RUSSIAN AND CHINESE COMPANY - GOVERNED BY RUSSIAN LAW
REQUEST TO RETURN ADVANCE PAYMENT AND TO REPAY COSTS OF PARTICIPATING IN SETTLEMENT NEGOTIATIONS - ARBITRAL TRIBUNAL, HAVING FOUND NO SPECIFIC REGULATION IN APPLICABLE DOMESTIC LAW ADDRESSING THE ISSUE AT STAKE, REFERRED TO THE UNIDROIT PRINCIPLES AS LEX MERCATORIA IN ORDER TO JUSTIFY THEIR SUBSIDIARY APPLICATION TO RUSSIAN CIVIL LAW - APPLICATION OF ARTICLE 7.4.8 ("MITIGATION OF HARM")
Claimant, a Russian company, entered into a sales contract with Respondent, a Chinese company. A dispute arose when Claimant requested from Respondent to return the advance payment and to repay the costs of participating in settlement negotiations.
The contract was governed by the law of the Russian Federation. However the Arbitral Tribunal, having found no specific regulation in that law addressing the issue at stake, referred to the UNIDROIT Principles as lex mercatoria in order to justify their subsidiary application to Russian Civil law and in particular applied Article 7.4.8 on the duty to mitigate the harm caused by the non-performance and the right to reimbursement of the expenses reasonably incurred.