Sacheri (Italy) v. Robotto (Italy)

Case No. 2765 [1989], 16 Y.B. Comm. Arb. 156 (1991)

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Sacheri (Italy) v. Robotto (Italy)

Italy Supreme Court
Case No. 2765 [1989], 16 Y.B. Comm. Arb. 156 (1991)

Facts

Sacheri (plaintiff) and Robotto (defendant) were parties to a construction-related contractual agreement containing an arbitration clause, which required the referral of disputes to formal arbitration. No provision in the contract stated that the parties waived their right to appeal errors of law. After a dispute arose between Sacheri and Robotto, the matter was referred to formal arbitration. In Italy, formal arbitration required that a decision be based on the law, but informal arbitration relied solely on the contract at issue. Under the arbitration clause, Italian law governed the arbitration proceedings. The arbitrators who handled the dispute between Sacheri and Robotto were not legally trained or educated, so they designated an attorney to function as an expert and write up the final award issued in favor of Robotto. Sacheri filed to annul the award at the Genoa Court of Appeal, arguing that the arbitrators had failed to carry out their essential duties by delegating responsibility to the legal expert that exceeded merely drawing up the award. The arbitrators were only familiar with problems related to the technical aspects of construction and were entirely unfamiliar with the law. The legal expert formulated the final award, and because the arbitrators had such limited knowledge, they could not understand or review the award. Therefore, Sacheri argued, the arbitrators improperly relinquished the powers that they were granted when they were appointed. The court of appeal found that the award was valid, and Sacheri appealed to the Italy Supreme Court.

Rule of Law

Issue

Holding and Reasoning ()

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