Renusagar Power Co. (India) v. General Electric Co. (U.S.)

General Electric Company (plaintiff) entered into a sales contract with Renusagar Power Co. (Renusagar) (defendant) for equipment to be used to construct an electric plant in India. The contract included an arbitration clause referring disputes to arbitration conducted by the International Chamber of Commerce (ICC). After a dispute related to the sales contract arose, General Electric initiated ICC arbitration proceedings in March 1982. The ICC issued an award in General Electric’s favor. General Electric filed for enforcement of the award in India at the Bombay High Court, and enforcement was granted in October 1988. After General Electric initiated arbitration, but before an award was rendered, several court cases were filed and heard in India. In one case, General Electric applied to a lower court in Mirzapur, India, seeking a stay of judicial proceedings initiated by Renusagar until arbitration was completed. The lower court refused the request for a stay. However, the India Supreme Court later overturned the lower court, and the case was stayed. The Supreme Court held that a stay was mandatory because the conditions of the Foreign Awards Recognition and Enforcement Act of 1961 were met. Before the lower court’s refusal of the stay was overturned, Renusagar asked the ICC court to stay arbitration because the Mirzapur case was pending and, therefore, the arbitrators were functus officio. The arbitrators refused, holding that they were not functus officio. After the high court granted enforcement of the ICC award, Renusagar appealed the ruling. Renusagar argued that the ICC award was issued during the pendency of the Mirzapur lawsuit, and both proceedings concerned the same matters. Renusagar claimed that because the award was issued before the refusal of a stay was overturned, the arbitrators were functus officio, and the award was unenforceable.