Eitzen Bulk A/S v. Ashapura Minechem Ltd.

Facts

A contract of affreightment between Eitzen Bulk (a foreign party) and Ashapura Minechem (an Indian party) provided for arbitration in London with English law applicable, though the curial law was not expressly stated. An award was rendered in the London arbitration, and Ashapura sought to challenge it before Indian courts under Section 34 of the 1996 Act.

Issues

• Whether the express choice of London as the seat impliedly fixed English law as the curial law
• Whether Part I of the 1996 Act, and a Section 34 challenge in India, was impliedly excluded

Arguments

Ashapura argued that since the curial law was not expressly chosen, Part I was not excluded and Indian courts retained jurisdiction to set aside the award. Eitzen Bulk argued that the express choice of London as the seat necessarily imported English curial law and excluded the supervisory jurisdiction of Indian courts.

Held

The Court held it was unnecessary for the parties to expressly choose English law as the curial law because by expressly choosing London as the seat they impliedly chose the curial law of the seat. The combination of an express seat and the implied choice of curial law demonstrated the parties' implied exclusion of the Indian courts' concurrent supervisory jurisdiction over the foreign-seated arbitration. Accordingly, Part I and a Section 34 challenge in India were excluded.

Ratio decidendi

Express choice of a foreign seat carries with it an implied choice of that seat's curial law and amounts to an implied exclusion of Part I and Indian courts' supervisory jurisdiction.

Significance

Important authority (decided under the pre-BALCO/Bhatia regime applicable to the agreement) reinforcing that the seat determines the curial law and that designation of a foreign seat impliedly excludes Indian supervisory jurisdiction. Relied on by the Supreme Court in IMAX for the proposition that the seat is the arbitration's centre of gravity and determines the law governing the arbitration.

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