Dallah Real Estate and Tourism Holding Co v Ministry of Religious Affairs of the Government of Pakistan
A court asked to enforce a foreign award must decide for itself whether the party resisting enforcement was bound by the arbitration agreement, and is not bound by the tribunal's own ruling on its jurisdiction.
Facts
Dallah, a Saudi company, entered into an agreement with a trust established by the government of Pakistan to provide housing for pilgrims in Mecca. The agreement contained an ICC arbitration clause, with the seat in Paris. The trust later ceased to exist, and Dallah began arbitration against the Government of Pakistan, which had not signed the agreement. The tribunal held that the Government was a party to the arbitration agreement, and made an award against it. Dallah sought to enforce the award in England.
Legal principle
The Supreme Court refused enforcement. Lord Mance and Lord Collins said that, under section 103(2)(b) of the Arbitration Act 1996, which implements the New York Convention, the court must decide for itself, by a full review of the facts and the law, whether the arbitration agreement was valid under the law of the country where the award was made, and that the tribunal's own decision on its jurisdiction, under the principle of competence competence, was not binding on the court. Applying French law, the Government of Pakistan had not been a party to the arbitration agreement, because there was no common intention that it should be bound. The Paris Court of Appeal later reached the opposite conclusion, refusing to set aside the award.
Related cases on jurisdiction, the tribunal and the supervisory role of the courts
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- Allianz SpA v West Tankers Inc (The Front Comor) Case C-185/07, [2009] ECR I-663
- C v D [2007] EWCA Civ 1282, [2008] Bus LR 843
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