All-Union Export-Import Association Sojuznefteexport (Moscow) v. JOC Oil, Ltd

Moscow Arb. Case No. 109/1980 of 9 July 1984, XVIII Y.B. Comm. Arb. 92 (1993)

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All-Union Export-Import Association Sojuznefteexport (Moscow) v. JOC Oil, Ltd

USSR Chamber of Commerce and Industry Foreign Trade Arbitration Commission
Moscow Arb. Case No. 109/1980 of 9 July 1984, XVIII Y.B. Comm. Arb. 92 (1993)

Facts

Sojuznefteexport (SNE), a foreign trade organization established by the USSR, entered agreements to sell oil with JOC Oil Limited (JOC), a company from Bermuda. The agreements incorporated SNE’s standard conditions, including an arbitration clause. The arbitration clause required all disputes arising from the contract to be settled in the Commissions of the USSR Chamber of Commerce and Industry in Moscow without recourse to Soviet courts. After JOC took delivery of 33 oil shipments without payment, SNE initiated arbitration under the arbitration clause in the Foreign Trade Arbitration Commission Chamber of Commerce and Industry (FTAC). JOC countered that because two authorized SNE representatives did not sign the contract, the purchase agreement was entirely void under Soviet law. JOC also argued that because the contract was void, arbitration could not proceed because no legal relationship envisaged by the contract existed. SNE countered that, even if the purchase agreement was void, the arbitration clause was separate from the purchase agreement and that the arbitration clause did not require two authorized signatures to be valid.

Rule of Law

Issue

Holding and Reasoning (Per curiam)

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