Paris Court of Appeal, No. 07/14944 | Rory Wheeler, avocat (Paris) & solicitor (England)

Paris Court of Appeal, 23 October 2008, No. 07/14944

The BIO PLANETE COMPANY

Vs.

The SUNNY LAND COMPANY

By contract dated 15 May 2006 and referring to the general terms and conditions of the ‘Incograin N°19’ formula, SUNNY LAND, established in Italy, sold through the intermediary of STUDI BERNAROLI, a broker, more than a hundred tons of rapeseed to BIO PLANETE.

A dispute having arisen between the companies SUNNY LAND and BIO PLANETE, the latter submitted the matter to the arbitration of the Arbitration Chamber of Paris, in accordance with the stipulations of the aforementioned general terms and conditions.

BIO PLANETE having requested that the case was examined at second instance, an arbitral tribunal composed of Messrs. A, X, Y, B and C, issued an award on 19 July 2007, according to which BIO PLANETE was ordered to pay SUNNY LAND the sums of:

EUR 18,456 in respect of various invoices,
EUR 3,875.76 in contractual compensation,
EUR 2,500 and EUR 2,790.66, pursuant to the provisions of Article 700 of the Code of Civil Procedure and as arbitration costs.

BIO PLANETE appealed against this award and asks the court to annul it and order the defendant to pay compensation of EUR 3000 on the basis of Article 700 of the Code of Civil Procedure and to pay the costs.

In support of her claim, BIO PLANETE argues that the arbitral tribunal disregarded the principle of due process by proceeding, under conditions that were irregular in her view, to hear the parties and by closing the proceedings without the parties having been able to give a full explanation.

For its part, SUNNY LAND asks the court to reject the appeal, to confer exequatur on the award and to order the author of the appeal to pay EUR 5,000 in damages for abusive proceedings as well as EUR 2,500 pursuant to the provisions of article 700 of the Code of Civil Procedure and to charge the costs to his opponent.

UPON WHICH;

On the sole ground of non-compliance with the principle of due process (in french Principe de la contradiction)

BIO PLANETE, which invokes the provisions of Article 1484-4 of the Code of Civil Procedure, claims that the hearing of the parties, on the one hand in a capacity of knowing and on the other hand, after the hearing of each of the lawyers and the closure of the debates, constitutes a violation of the principle of due process and that, consequently, the disputed award must be annulled;

Whereas arbitration before the court calls into question the interests of international trade, as noted by the defendant to the appeal who, in these writings, referred to Article 1494 of the Code of Civil Procedure; Whereas the alleged complaint must be examined in the light of the provisions of Articles 1492 et seq., and in particular Article 1502-4, of the same Code;

Whereas, in order to be admissible before the judge in charge of summary proceedings, the ground taken from an arbitral award must be raised, whenever possible, before the arbitral tribunal itself; whereas BIO PLANETE, if it considered that it had to give explanations to the arbitrators or criticize those of the opposing party, had the right to request the reopening of the proceedings, which it neither claims nor demonstrates to have done; whereas it is therefore no longer admissible today, to invoke before the judge in charge of summary proceedings the disregard of the principle of due process;

Whereas the appeal should therefore be dismissed, it being specified that this dismissal automatically confers exequatur on the arbitral award, and that BIO PLANETE should be ordered to pay the costs;

Whereas SUNNY LAND, which requests that the opposing party be ordered to pay damages for abuse of procedure, does not justify a sufficiently serious prejudice; that this request will therefore not be granted;

Whereas, on the other hand, equity justifies that BIO PLANETE be ordered to pay SUNNY LAND the sum of EUR 2,500, pursuant to the provisions of article 700 of the Code of Civil Procedure;

FOR THESE REASONS;

REJECTS the appeal lodged against the arbitral award pronounced on 19 July 2007 by the Arbitration Chamber of Paris;

DECLARES that this award is enforceable;

DISMISSES the claim for damages made by SUNNY LAND;

ORDERS BIO PLANETE to pay SUNNY LAND compensation of 2,500 euros pursuant to the provisions of article 700 of the Code of Civil Procedure;

ORDERS the company BIO PLANETE to pay the costs and admits the company S.C.P. NARRAT- PEYTAVI, avowed in favor of article 699 of the Code of Civil Procedure.