Lisbon Court of Appeal | Disregard of the Arbitration Clause| 13-09-2018 | Case #106
Case nr. 2741/16.1T8PTM.L1-2
The law attributes to the arbitral tribunal the competence, in the first place, to assess its competence to resolve a conflict. That is, confronted, on a timely basis by the defendant, with the invocation of an arbitration agreement, the state court must refrain from judging the dispute and relegate to the arbitration court the assessment of the existence, validity, effectiveness or enforceability of the arbitration agreement, unless the occurrence of any of these defects or obstacles to the jurisdiction of the arbitral tribunal is manifest (paragraph 1 of Article 5 of the Voluntary Arbitration Law).
I- Faced with a timely plea by a party to invoke an arbitration agreement, the state court shall refrain from judging the dispute, and shall relegate to the arbitral tribunal the assessment of the existence, validity, effectiveness and enforceability of the arbitration agreement, unless the occurrence of any of defects or obstacles to the jurisdiction of the arbitral tribunal is manifest.
II- The plea of invalidity of the basic agreement, i.e., the one to which the arbitration clause belongs or refers, does not affect the preferential or first line jurisdiction of the arbitral tribunal in relation to the state court. This will only be affected if the invalidity of the basic contract is obvious, and the conclusion can be reached without any further investigation.
III- The law does not establish public order as a determinant for the jurisdiction of arbitral tribunals, but rather as a ground for the nullity of an arbitral award. Consequently, public order shall act only downstream, that is, at the stage of the possible evaluation of the legality of the arbitral award, and will not affect the principle of Competence-Competence in determining the jurisdiction of the arbitral tribunal.
Summary and headlines kindly prepared by Avani Agarwal (final year law student at NALSAR University of Law, Hyderabad, India; Avani Agarwal may be contacted by email: firstname.lastname@example.org