Danish Polish Telecoms v Telekomunikacja Polska S.A.

JurisdictionIreland
JudgeMs. Justice Finlay Geoghegan
Judgment Date06 October 2011
Neutral Citation[2011] IEHC 369
Docket Number[2011 No. 19 MCA, 2011 No. 35 COM]
CourtHigh Court
Date06 October 2011

[2011] IEHC 369

THE HIGH COURT

[No. 19 MCA/2011]
[No. 35 COM/2011]
Danish Polish Telecommunication Group I/S v Telekomunikacja Polska S.A.
COMMERCIAL
IN THE MATTER OF THE ARBITRATION ACT 2010, AND
IN THE MATTER OF AN ARBITRATION BETWEEN:
DANISH POLISH TELECOMMUNCATION GROUP I/S
APPLICANT

AND

TELEKOMUNIKACJA POLSKA S.A.
RESPONDENT

ARBITRATION ACT 2010 S8

BROSTROM TANKERS AB v FACTORIAS VULCANO SA 2004 2 IR 191

ARBITRATION ACT 1980 S7

DALIMPEX LTD v JANICKI & ORS 2003 CANLII 34234 (ON CA) 228 DLR (4TH) 179

IPCO (NIGERIA) LTD v NIGERIAN NATIONAL PETROLEUM CORP 2009 1 AER (COMM) 611

SOLEH BONEH INTERNATIONAL LTD v GOVERNMENT OF REPUBLIC OF UGANDA & ORS 1993 2 LLOYDS REP 208

ARBITRATION ACT 2010 S23(1)

ARBITRATION ACT 2010 S25

ARBITRATION LAW

Foreign award

Enforcement - Principles applicable - Appeal of award pending - Adjournment of decision on enforcement pending appeal - Whether necessary to adjudicate on foreign law - Whether reasonable or substantial grounds that party appealing would succeed - Whether award manifestly invalid - Security - Partial enforcement - Whether court could enforce undisputed part of award - UNCITRAL Model Law on International Commercial Arbitration - Dalimpex Ltd v Janicki [2003] 64 OR (3d) 737 and Ipco (Nigeria) Ltd v Nigerian National Petroleum Corp [2008] EWCA Civ 1157, [2009] 1 All ER (Comm) 611 followed; Brostrom Tankers AB v Factorias Vulcano SA. [2004] IEHC 198, [2004] 2 IR 191 distinguished - Arbitration Act 2010 (No 1) - Adjournment and security granted (2011/19MCA & 2011/35COM - Finlay Geoghegan J - 6/10/2011) [2011] IEHC 369

Danish Polish Telecommunication Group v Telekomunikacja Polska

Facts: The plaintiff sought recognition and enforcement of an international arbitral award pursuant to Article 35 of the UNCITRAL Model Law, given force in Irish law pursuant to s. 8 Arbitration Act 2010. The Award sought to be enforced was a Partial Award. Alternatively, the Court was asked to adjourn the decision pending the determination of Austrian proceedings. The respondent argued that the Court was obliged to refuse recognition of the award as the respondent was unable to present its case, the composition of the Tribunal was not in accordance with the Agreement of the parties and that the award was in breach of public policy. A dispute arose regarding the amounts owed pursuant to the revenue sharing provision on the contract.

Held by Finlay Geoghegan J. that the Court did not have jurisdiction to give leave to enforce that part of the Partial Award in respect of which the applicant contended that there was no contest. The Court would propose ordering security in the initial sum of Eur 1.5 million and propose granting liberty to apply in relation to the continuation of the adjournment pending the determination of any appeal.

Reporter: E.F.

1

1. Danish Polish Telecommunication Group I/S ("DPTG") seeks recognition and enforcement of an international arbitral award pursuant to Article 35(1) of the UNCITRAL Model Law on international commercial arbitration ("the Model Law") given force of law in the State by s. 8 of the Arbitration Act 2010.

2

2. The Award sought to be recognised and enforced is the corrected Award set out in the dispositive section of the addendum dated 2 nd November, 2010, and will, in this judgment, be referred to as "the Partial Award". Nothing turns on the fact that it is a corrected Award.

3

3. The Partial Award obliges Telekomunikacja Polska SA ("TPSA") to pay the principal amount of DKK1,998,422,812.00 (€268,052,448.00). Further paragraphs of the Partial Award require payment of interest and costs.

4

4. The Partial Award was made in an arbitration which took place in Vienna, Austria pursuant to the UNCITRAL Arbitration Rules and commenced in 2001. The Partial Award is an award made in respect of the first phase of the arbitration which deals with the first period of relevant time (February 1994 to June 2004). It is common case that it is an award which may be the subject of recognition and enforcement in the State pursuant to Article 35 of the Model Law unless recognition and enforcement is refused pursuant to Article 36.

5

5. For the purposes of this judgment, the background to the dispute need only be briefly recorded. The dispute to which the arbitration relates concerns a contract in writing of 17 th April, 1991, between Polish Foreign Trade Company ELECTRIM S.A., acting on behalf of the Polish PTT, and DPTG in relation to the construction in Poland of the North/South Link Optical Fibre System. TPSA is the legal successor of the Polish PTT under the NSL contract.

6

6. A dispute arose between DPTG and TPSA regarding the amounts owed by TPSA pursuant to the revenue sharing provision in clause 8 of the NSL contract. Article 15 of the NSL contract provides for the settlement of disputes by arbitration in accordance with the UNCITRAL Arbitration Rules, as follows:

"Article 15."

DISPUTES. APPLICABLE LAW.

1

Any dispute and/or difference between the Partie which could not be settled in an amicable way shall be finally settled, without the recourse to the common courts of Law, by the arbitration in accordance with the UNCiTRAL Arbitration Rules. The place of arbitration shall be Vienna, Austria. The language of the proceedings shall be English. The number of arbitrations shall be three. The appointing authority shall be the President of the Federal Economic Chamber, Vienna, Stubenring 12, Austria. The award of the arbitration shall be final and binding and the Parties agree to fulfil it voluntarily.

2

The Austrian Law shall apply to this contract. If any issue in question is covered by the International Telecommunication Convention to which both Denmark and Poland are members, then this Convention will be correspondingly applied."

7

7. Three arbitrators were appointed in purported compliance with article 15. There have been changes to the composition of the Arbitral Tribunal and two changes of chairman. The first phase of the arbitration has been lengthy and exceedingly complex. The reasoned Partial Award dated 24 th August, 2010, comprises 1,050 paragraphs. There were further hearings subsequent to the delivery of that Award and the addendum delivered on 2 nd November, 2010.

8

8. By proceedings issued in the Commercial Court of Vienna, Austria on 2 nd December, 2010 ("the Austrian proceedings"), TPSA seeks to challenge the Partial Award and requests that it be set aside. Those proceedings are being vigorously defended by DPTG. They are relevant to the issues to be determined in this application.

9

9. This application commenced by originating notice of motion on 26 th January, 2011, grounded on affidavit. It was admitted to the Commercial List and case managed by directions in the usual manner. Further affidavits were filed by both parties and lengthy expert opinions exhibited both in relation to the UNCITRAL rules and in relation to Austrian law, including the prospect of success and failure of the Austrian proceedings. The Austrian experts expressed differing views on aspects of Austrian law, its application to the Austrian proceedings and the probable outcome of the Austrian proceedings.

10

10. Prior to a directions hearing before Kelly J. on 3 rd June, 2011, it appears that the parties agreed that the same approach should be taken at the hearing of the application for recognition and enforcement herein to the disputes in relation to Austrian law, as had been taken in relation to foreign law disputes in proceedings heard and determined by Kelly J. in Brostrom Tankers AB v. Factorias Vulcano SA [2004] 2 I.R. 191. That was an application to enforce a New York Convention award in an international arbitration pursuant to s. 7 of the Arbitration Act 1980. In the affidavits filed in those proceedings, there was conflict between Spanish and Norwegian lawyers on questions of Spanish and Norwegian law. The approach suggested by Kelly J. and adopted by the parties in those proceedings is recorded by Kelly J. in his judgment at p. 196 in the following terms:-

"Without, therefore, deciding any of these vexed questions of foreign law, I am now going to decide whether, even if they were all decided in favour of the defendant, it would provide a basis for refusing enforcement of the award. If I decide that it would, I will then have to hear the cross-examination of the foreign lawyers and decide whether as a matter of fact the plaintiff or the defendant's experts are correct in their opinions as to the relevant legal questions. If I decide to the contrary, then the matter is at an end. That is so because, even with all of the foreign legal questions decided in favour of the defendant, it would not provide a basis for refusing enforcement under s. 9(3) of the Act of 1980."

11

11. Unfortunately, what appears to have been overlooked by the parties in these proceedings at the time that they decided to adopt this approach (which, may often make sense in relation to a decision on enforcement or refusal of enforcement), was that in these proceedings, unlike in the Brostrom proceedings, TPSA seeks, in the alternative, an adjournment pursuant to Article 36(2) of the Model Law pending the determination of the Austrian proceedings. Unfortunately, the potential complication of the Brostrom approach to the adjournment application only became apparent towards the end of the hearing. It was decided between the parties that I should hear the application, including the application for the adjournment upon the basis of the Brostrom agreement. Nevertheless, counsel for TPSA submitted, at all times, that it was not necessary for this Court to actually determine questions of Austrian law for the purposes of the adjournment application. I will refer to this further below.

Legislative...

To continue reading

Request your trial
1 cases
  • Jackson way Properties Ltd v Dun Laoghaire/Rathdown County Council
    • Ireland
    • High Court
    • 9 d5 Outubro d5 2015
    ...for the defendant further relies on the decision of this Court in the case of Danish Polish Telecoms v. Telekomunikacja Polska SA [2012] 3 I.R. 44 and the decision of the Court of Appeal in England in the case of National Nigerian Petroleum Corporation v. IPCO (Nigeria) Ltd. [2008] EWCA Civ......

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT