The question of what treatment should be afforded by U.S. courts to an

arbitral award falling under the New York Convention that already has been set

aside by a court at the place of arbitration is much discussed by specialists in the

field but less frequently encountered in the day-to-day work of the courts. The

question has reached federal appellate courts and been addressed at that level only

twice – in the Baker Marine and TermoRio cases. The issue has not had

sufficient judicial exposure for a cohesive approach to have developed. Each case

inevitably raises, among other questions, what respect should be given to the

result of a judicial proceeding in a country with which the United States enjoys

more or less sanguine diplomatic and trade relations. Principles of comity among

nations, drawn from what may be termed the U.S. federal common law of foreign

relations, have tended to prevail over principles of deference to the arbitration

outcomes of arbitration derived from the New York Convention and the Federal

Arbitration Act. In contrast, arbitration theorists who view the arbitration process

as being only minimally connected to the State that plays host to the arbitration

find deference to the outcomes in the Host State’s courts less compelling.

Whereas the issue is far from settled in the United States, there remains a need for

discussion despite the extensive literature already devoted to the question. This

article explores the evolution of U.S. law, considers how the French theory of

“de-localization” fits (or does not) with U.S. law, and concludes that principles of

deference to the decisions of international arbitrators, developed in U.S.

arbitration jurisprudence, deserve greater weight than they have received when the

question of enforcement of an annulled award is presented.

 

I. IN THE BEGINNING, THERE WAS CHROMALLOY

 

The 1996 decision of a U.S. district court in Washington, D.C. in Chromalloy

Aeroservices v. Arab Republic of Egypt, granted recognition of an award made in

favor of a U.S. company against the Egyptian State by an arbitral tribunal with its

seat in Cairo, Egypt. The arbitration had been conducted under Egyptian
arbitration law by agreement of the parties, and the award had been set aside by