X. v. A., B., C., D. [The Turkish Football Club] - Swiss International Arbitration Law Reports (SIALR) - 2007 Vol. 1 Nos. 1 & 2

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24 pages

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December, 2007

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Headnote

When the parties have executed two successive agreements and the

latter contains a term to the effect that the provisions of the former

agreement are to prevail in case of conflict, the arbitral tribunal referred

to in the first agreement will have jurisdiction to hear claims arising

under both agreements.

The interpretation by an arbitrator of the agreements in dispute can not

be reviewed in setting aside proceedings based on a violation of public

policy and of the principle pacta sunt servanda.

An arbitrator is not required to obtain the parties’ views on the

circumstances that he will consider unless such circumstances are not

raised by either party or neither party could have anticipated reliance on

such circumstances.

Summary of the Decision

Turkish Football Club, X., concluded four employment contracts

(“Private Contracts”) with A., B., C. and D. Each of the parties then signed

a second contract (“Single Type Contracts”). Both contracts contained

arbitration clauses, the terms of which differed. Subsequently, X.

terminated the employment contracts and A., B., C. and D. brought

arbitration proceedings pursuant to the Private Contracts before a CAS

panel. The CAS panel accepted jurisdiction since the Private Contracts

contained a CAS arbitration clause and the Single Type Contracts

contained a term that the provisions of the Private Contracts would prevail

in case of contradiction. The CAS panel then made an award ordering X. to

pay compensation to A., B., C. and D. X. brought an application to set

aside the arbitral award on the grounds that (1) the arbitrators wrongfully

accepted jurisdiction, (2) the award was inconsistent with public policy,

and (3) the award violated its right to present its case.

The Federal Supreme Court held: (1) the finding by the arbitrators as

to the superiority of the arbitration clause in the Private Contracts is

beyond the scope of review and in any event is unobjectionable and

therefore the arbitrators properly asserted jurisdiction; (2) the arbitral

award did not violate the principle pacta sunt servanda and was not

incompatible with public policy in so far as the arbitrators found that the

termination notices had been sent pursuant to one contract rather than