Fiona Trust & Holding Co. v. Provalov
United Kingdom House of Lords
[2007] UKHL 40 (2007)
- Written by Mary Katherine Cunningham, JD
Facts
The owners of eight Russian companies (the owners) (plaintiff) and eight charterers (the charterers) (defendants) entered a contract using a standard form. Within that contract, the arbitration clause stated that “any dispute arising under this charter shall be decided by the English courts.” The owners alleged that a Russian individual who controlled the charterers procured the charters by bribery of Russian officials. The owners filed a suit in England, seeking a declaration that the charters have been validly rescinded. The charterers responded by moving for a stay under Section 9 of the Arbitration Act 1996. The court of appeal granted the stay, and the owners appealed to the House of Lords. The owners argued the matter could not be referred to arbitration because the dispute about the allegation of bribery was not a dispute arising under the charter. The owners further argued that, because the main contract was liable to be rescinded, the arbitration clause within the main contract did not apply to them.
Rule of Law
Issue
Holding and Reasoning (Lord Hoffman, J.)
Concurrence (Lord Hope of Craighead, J.)
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