A ,a company incorporated and domiciled in Shanghai, and B , a French company, entered into a contract in Beijing for the sale of goods. There is an arbitration clause in their contract, which stipulated:"All the disputes amusing from or in relation to the contract shall be arbitrated in Shanghai in accordance with the ICC rules ". Later a dispute concerning the performance of the contract across between both paties.
If A is unwilling to go to arbitration, please give some advice to it.
If company A will not submit to arbitration, it can first negotiate with company B to reach a reconciliation, which is the most effective and economical approach to solve a dispute. For the fullest execution of the contract, A could make some concessions in the negotiation.
If the dispute was not solved through the first approach and company A still will not submit to arbitration, it can avoid it by claiming the invalidation of it. . ICC rules,Article 6, clause 2 says ” If the Respondent does not file an Answer, as provided by Article 5, or if any party raises one or more pleas concerning the existence, validity or scope of the arbitration agreement, the Court may decide, without prejudice to the admissibility or merits of the plea
or pleas, that the arbitration shall proceed if it is prima facie satisfied that an arbitration agreement under the Rules may exist. In such a case, any decision as to the jurisdiction of the Arbitral Tribunal shall be taken by the Arbitral Tribunal itself. If the Court is not so satisfied, the parties shall be notified that the arbitration cannot proceed. In such a case, any party retains the right to ask any court having jurisdiction whether or not there is a binding arbitration agreement.” It is obtained from this clause that arbitration procedure cannot progress if the existence of the arbitration agreement cannot be proved.
If you are a counselor for B, please give your opinion about the draft of the arbitration clause.
Based on minimizing the loss, the best solution is to negotiate with company A to reach a new agreement. Once arbitration or litigation procedure is taken, the cost paid by the company will be considerably increased.
If the negotiation fails and company A will not submit to the arbitration, company B can start a suit according to Chinese law. Although it is not specific about the arbitration in the contra
ct, the name of the arbitration committee is still determined if it can be inferred from the content of the contract and the practical situation. The contract has confined the arbitration site to Shanghai City and there is only one arbitration committee there, which can be determined. Consequently, the clause concerning arbitration in the contract is available.
After confirming validity of the arbitration pact, company B can submit to the Arbitration Committee of Shanghai for arbitration. It can also start a lawsuit in the court to solve the dispute.
Do you think it important to learn legal English? Why?
I think it is of great importance learning legal English well.
First, many advanced legal thoughts are proposed by foreign legists. Their viewpoints are often distorted or even contrary to the original senses. Even if they are correctly translated, the words are often obscure and hard to follow due to the preciseness and complexity of the legal language. Reading the original in English is favorable for us to understand fully and deeply the standpoint of the author.
Secondly, beneficial relations are expanding with the progress of globalization. Especially since China participated into the WTO, the frequency of foreign cases keeps increasing rapidly, however, there exists great communication difficulty for the lack of lawyers and judges who have good master of legal English. Only a limited number of courts in the developed areas have the ability to solve foreign cases. It is therefore a significant aspect to make me competent for the contemporary legal profession.
In conclusion, a good knowledge of legal English is beneficial for us to widen our vision, and enhance our academic attainment..
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