Our client has concluded a contract with a Cypriot company that manages a network of shopping centers in Russia. The standard arbitration clause, the inclusion of which in the contract was insisted upon by the Cypriot company, stipulated that disputes are resolved by an ad hoc arbitral tribunal, while the judge must have a certificate from the North-Western Arbitration Association. Due to the non-payment of contracted work, we, on behalf of our client, appealed to the arbitration court. This decision was made because the counterparty persistently suggested their preferred arbitrator, who had already considered similar disputes several times and consistently ruled in their favor. The Arbitration Court of St. Petersburg and the Leningrad Region accepted the claim for proceedings and satisfied it, leaving the counterparty’s objections that the dispute was subject to consideration in an arbitral tribunal unsatisfied.
We managed to convince the court that the Association certificate held by the candidate for arbitrators from the counterparty was issued only for representing interests in arbitration courts, but not for acting as an arbitrator, and that due to fundamental disagreements between the parties, the formation of an ad hoc arbitral tribunal is impossible. The court’s decision was upheld in the appellate instance.
