(1) Whether an arbitration clause is not binding since the parties’ choice
of law did not have any connection with the contract or the dispute.
(2) Whether an arbitration clause is null and void because it does not
include an explicit will of the parties to comply with the award.
(1) Under the Geneva Convention on International Arbitration of 1961,
Art. VI.2, the courts shall decide the validity of an arbitration
agreement in accordance with the law chosen by the parties. Since the
parties’ agreement was subject to the laws of the State of New York
and clearly referred to arbitration under the rules of the American
Arbitration Association, it did not matter that the chosen law lacked
any connection with the contract or the dispute.
(2) The principle that the arbitration clause must express the parties’
undertaking to comply with the award, only applies to national
arbitration and not to international arbitration – and even less so to
international commercial arbitration. Moreover, the arbitration
agreement is so clear that it excludes the need for interpretation on
Claimant: Kern Electrónica SA (Spain)
Respondent: Goldstar Company Limited (Korea)
PLACE OF COURT PROCEEDINGS:
APPLICABLE LAW AND CONVENTION:
The Spanish Arbitration Act of 5 December 1998, Articles 5.1 and 61
The Geneva Convention on International Arbitration of 1961
Excerpts below are an unofficial translation of the proceedings.