Interim Award in ICC Case No. 8786

The claimant and the defendant entered an agreement for the defendant to purchase the claimant’s ready-made clothes. The agreed-upon order contained an arbitration agreement, which provided the International Chamber of Commerce (ICC) Rules and the provisions of chapter 12 of the Swiss Law on Private International Law (SLPIL). A dispute arose between the parties after the defendant cancelled the order. The claimant alleged the defendant cancelled the order despite already approving the samples. The claimant claimed damages for unusable materials, loss of profit, and costs. The defendant asserted late performance by the claimant, arguing that it had to terminate the contract due to the claimant’s breaches of the terms of the agreement. The defendant also sought damages for loss of profit and various costs. The parties referred the dispute to arbitration before a sole arbitrator. The defendant asked for an interim award on security from the claimant, arguing the claimant would not comply voluntarily with the arbitral proceedings. Citing caselaw from the Turkish Court of Appeals and studies on arbitration enforcement in Turkey, the defendant argued security was required from the claimant as foreign parties were often unable to enforce arbitral awards in Turkey. The claimant countered that the defendant’s request for an interim award was premature and that the defendant needed to defer to the Turkish courts.