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The Enforcement of International Arbitration Agreements and Referral Applications in the NAFTA Region - Commercial Mediation and Arbitration in the NAFTA Countries

Author(s): 
Pierre A. E. Bienvenu
Page Count: 
26 pages
Published: 
November, 1999
Practice Areas: 
Commercial Disputes,
Agreement to Arbitrate,
Enforceability of Arbitration Agreements,
ADR,
NAFTA
Author Detail: 

Pierre Bienvenue is a partner of Ogilvy Renault practicing in the firm's Montreal office. He has been a member of the Litigation Group since 1983 and is a member of the Firm's Management Committee. Mr. Bienvenue has acted as counsel in numerous domestic and international commercial arbitration cases, both ad hoc and institutional.

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INTRODUCTION 
The  current  widespread  enforceability  of  arbitration  agreements  is arguably one of the most important factors having contributed to the development of international commercial arbitration as the preferred method of dispute settlement in international trade1.  Such recognition is, after all, the backbone of arbitration as a means of resolving disputes since it ensures that parties having agreed  to  resort  to  arbitration  will  be  held  to  their  bargain.  Indeed,  it  has  been said  that  the  enforcement  of  arbitration  agreements  reflects  a  transnational  rule of international commercial arbitration2. 
 
What is now taken for granted among most trading nations was - even recently - not so widely accepted.   To use an example from the author's jurisdiction, in the Canadian Province of Quebec3, the clause compromissoire - or undertaking to refer future disputes to arbitration - had traditionally been held to  be  contrary  to  public  policy  and,  as  such,  illegal  and  unenforceable4.   Only agreements to refer existing disputes to arbitration were enforced by the courts of Quebec.   In spite of amendments made in 1966 to Quebec's Code of Civil Procedure in order to reverse this jurisprudential trend, it was not until 1983 that the Supreme Court of Canada finally confirmed the validity and - importantly - the enforceability of the clause compromissoire under the law of Quebec5. 
 
The role of the New York Convention on the Recognition and Enforcement of  Foreign Arbitral Awards (the "New York Convention") in fostering the use of arbitration  to  settle  international commercial  disputes  cannot  be  overstated.  While its title might suggest that it only relates to the recognition and enforcement of  international arbitral awards, the New York Convention also enshrines in its second article the fundamental principle that arbitration agreements - whether they relate to existing  or future disputes - are binding and must be given effect by the courts of Contracting States.  Article II  reads as follows: