Laura Langer Limited (LLL – a company incorporated in Canada)

Laura Langer Limited (LLL – a company incorporated in Canada) entered into an agreement (the Agreement) with Scott Schwartze SA (SSS – a company incorporated in Geneva, Switzerland)

Laura Langer Limited (LLL – a company incorporated in Canada)

Question 1
Laura Langer Limited (LLL – a company incorporated in Canada) entered into an agreement (the Agreement) with Scott Schwartze SA (SSS – a company incorporated in Geneva, Switzerland) for the sale by LLL and purchase by SSS of two consignments of minerals used in the manufacture of modern batteries for electric motor cars.

The Agreement included this clause:
“47. All differences and disputes which might arise between the parties to this Agreement or which might be connected in any way to this Agreement shall be submitted to arbitration for resolution. The seat of arbitration shall be in London, England, United Kingdom, and the substantive law of this Agreement and of this clause shall be English law.”

Unfortunately, a dispute arose between the two parties when LLL failed to deliver the two consignments of minerals. By this time, LLL was not keen to arbitrate. So, LLL commenced a court Action in the High Court, London (England). Seeking a declaration that LLL was not liable for breach of the Agreement. Without mentioning the arbitration clause in the Agreement, LLL obtained permission to serve out. When serving the Claim form on SSS in Switzerland. LLL asked if SSS would be prepared to try to settle the dispute by mediation. SSS replied saying that it would be prepared to mediate using CEDR, and LLL replied agreeing to CEDR mediation.

A fortnight before the start of the intended CEDR mediation. SSS e-mailed LLL to say that it (SSS) was now not prepared to mediate and that it intended to arbitrate instead as required by clause 47 of the Agreement.

LLL e-mailed back to say that SSS had contracted to settle the dispute by mediation and, so, there could be no arbitration. SSS is not prepared to accept the approach of LLL.

Please advise SSS on all the issues arising in the matter so far, and advise SSS what it should do now. Further, please support your advice with reference to relevant law and practice.

Question 1
Even where separability is excluded by the agreement of the parties, the arbitral tribunal must determine its own jurisdiction. Where the tribunal goes on to determine that it has jurisdiction and will exercise that jurisdiction. There can be difficulties in knowing when the tribunal’s jurisdiction is at an end.

Please discuss all the issues raised in the above paragraph with reference to the Arbitration Act 1996 (UK excluding Scotland).

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