Newsletter-21

171 ARBITRATION LAW Court in its previous case numbered 4A_18/2007 4 dated June 6, 2007 found that challenging an award for the failure to comply with the conciliation as the prerequisite for arbitration is an abuse of right if the party who is challenging the award did not request conciliation prior to arbitration. Further Court stated that this case is distinguished from its previous decisions since the Respondent has taken place in conciliation and immediately raised an objection to the jurisdiction of the arbitral tribunal. The Court had to decide upon the consequences of the failure to comply with the conciliation as a prerequisite for arbitration. The con- sequences of such non-compliance should be procedural rather than damage claims or declaration of inadmissibility, dismissal of the claim based on merits. One of the possible procedural consequences is to stay of the arbitration pending on compliance with the dispute resolu- tion clause. Accordingly the Court considering cost and time issues found that the proper consequence would be to stay of the arbitration proceedings. Conclusion The Decision is considered a leading case that would be a prec- edent for arbitral tribunals and counsels. It is the first time that the Court set aside an award for the failure to comply a dispute resolution mechanism as a condition precedent with arbitration. In its previous decisions such as case numbered 4A_ 46/2011 5 dated May 16, 2011 the Court dismissed the claim to set aside for the breach of a prerequisite for arbitration but set aside the award for vio- lation of right to be heard. In another case numbered 4A_124/2014 6 dated July 7, 2014, the Court have examined Article 20 of the FIDIC Conditions of Contract and the jurisdiction of the arbitral tribunal prior to FIDIC Dispute Adjudication Board (“DAB”) procedure, the Court 4 See; http://relevancy.bger.ch/php/aza/http/index.php?lang=de&zoom=&type= show_document&highlight_docid=aza%3A%2F%2F06-06-2007-4A_18-2007. 5 See; http://www.swissarbitrationdecisions.com/sites/default/files/16%20mai%20 2011%204A%2046%202011.pdf. 6 See ,http://www.swissarbitrationdecisions.com/sites/default/files/7%20juil- let%202014%204A%20124%202014.pdf.