Supreme Court of Justice
Case No. 230/23.7YRPRT.S1
Date: 12 November 2024
Link to DGSI website HERE
Keywords: Kompetenz-Kompetenz | Public Policy | Partial Arbitral Award | Annulment Arbitral Award
Summary:
I – Article 18(1) of the Voluntary Arbitration Law (LAV) grants the arbitral tribunal the power to decide on its own jurisdiction, even if for that purpose it is necessary to assess the applicability of the arbitration agreement or of the contract in which it is contained. Such a ruling may be made either in an interlocutory decision or in the final award on the merits of the case.
Where the decision is interlocutory, the dissenting party may challenge it before the competent state court within thirty days of its notification to the parties (Article 18(9) LAV), without prejudice to the arbitral proceedings continuing until their conclusion under Article 18(10) LAV.
II – Having decided, in an interlocutory order, that in order to assess the dispute arising from the breach of the consortium agreement it was indispensable to consider the losses resulting from the breach of the works contract which had been awarded as the basis for the conclusion of the consortium agreement between the parties, the arbitral tribunal thereby enabled the dissenting party to challenge, within thirty days of notification, its decision regarding the scope of its jurisdiction so established.
III – The lapse of the time limit laid down in Article 18(9) LAV precludes the right to seek annulment of the arbitral award on the grounds of breach of the arbitration agreement as determined in the prior interlocutory decision.
IV – The duty to provide reasoning in an arbitral award, where none of the exceptions set out in Article 42(3) LAV apply, has a degree of intensity comparable to the duty to give reasons in judicial court decisions. It requires at least a minimum content that effectively clarifies for the parties and the public at large the judge’s reasoning process and the grounds that led to the specific decision. It is, however, indispensable that the decision be based on reasoning that makes it intelligible and that is as developed as the case warrants.
V – When the competent Portuguese state court verifies, even ex officio, that the arbitral award offends principles of public policy (domestic or international) of the Portuguese State, it must annul the award.
VI – An arbitral award does not offend any principles of public policy of the Portuguese State when, while recognising the claimant’s material damages, it orders the respondent to compensate it, even if the arbitrators are not unanimous as to the method for calculating the amount of compensation awarded.
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