Final Arbitral Award and Additional Arbitral Award rendered in 1998 in case 17/1997

Observations by John Kadelburger

Subject-matters:

(1) Jurisdiction; interpretation of contract under Swedish law.

(2) Validity of assignment and the right of assumed assignee [Claimant] to rely on the arbitration clause.

(3) Can a third party beneficiary rely on the arbitration clause in an agreement to which it is not a party?

(4) Reduction of the claimed legal expenses.

Findings:

(1) Under Swedish law, the wording of a contract in writing is preferred unless one could establish a different common intention of the parties.

(2) Where the contract provides for the right of a party to assign, cede and transfer obligations (but not rights) an assignment cannot validly include the arbitration clause.

(3) Although several stipulations in the contract concluded between X and Y indicate that Z has a position as third party beneficiary, they are inconsistent with the prohibition under the contract to transfer rights and exclude the right for Z to rely on the arbitration clause in the contract.

Case dismissed for lack of jurisdiction.

(4) The amount claimed by Respondent is excessive bearing in mind the relatively limited scope and complexity of the issues involved in the matter of jurisdiction.