Court of Cassation, No. 13-11.745

Court of Cassation, First Civil Chamber, 5 November 2014, No. 13-11.745

YUKOS CAPITAL (YUKOS)

Vs.

OKTRYTOYE AKTSIONERNOYE OBSHESTVO TOMSKNEFT VOSTOCHNOI NEFTYANOI KOMPANII (TOMSKNEFT)

Summary

The burden of proof of a violation by the arbitrator of due process (in French Principe de la contradiction) lies with the party claiming such violation.

Reverse the burden of proof, the Court of Appeal relying solely on that party’s denials concerning its receipt of the arbitrator’s notifications, reverses the burden of proof, despite the award’s statements to the contrary.

Complete text

THE COURT OF CASSATION, FIRST CIVIL CHAMBER, delivered the following judgment:

On the only ground of appeal, taken in its second branch, which is admissible:

With respect to Article 1520-4 of the Code of Civil Procedure, together with Article 1315 of the Civil Code;

Whereas, the party who invokes the arbitrator’s violation of due process (in French Principe de la contradiction) bears the burden of proof concerning such violation;

Whereas, according to the contested judgment, Yukos capital, a company incorporated under the laws of Luxembourg, filed a claim for the enforcement (in French Exequatur) in France of an arbitral award rendered upon its claim in New York on 12 February 2007 by a sole arbitrator ruling under the supervision of the International Chamber of Commerce (ICC), following proceedings in which Oktrytoye aktsionernoye obshestvo tomskneft vostochnoi neftyanoi kompanii (Tomskneft), a company incorporated under Russian laws and which contested the existence of an ICC arbitration clause, did not participated;

Whereas, in order to dismiss Yukos' application for enforcement (in French Exequatur) for failure to comply with due process (in French Principe de la contradiction) after having noted that, notwithstanding the references made in the award, no evidence of receipt, by whatever means, of the Procedural Order No. 1 of 28 September 2006 amending the provisional timetable previously agreed was provided. No evidence of the receipt of the arbitrator’s letter sent on 12 October 2006 to the defendant reminding it of the modification of the time limit concerning it, was provided too, as well as Procedural Order No. 2 of 23 November 2006 inviting the parties to participate in the hearing in the following December. Moreover, the evidence of the arbitrator’s decision to close the proceedings, while allowing the defendant to submit its observations before 5 January 2007 on two new documents submitted by the claimant at the hearing and the dispatch of the transcripts of the hearing and these documents, was not provided. The Court of Appeal held that the evidence of the receipt of these notifications formally denied by Tomskneft could not be inferred from the fact that the arbitrator, if he had been advised of the impossibility of delivering any of these correspondences, would have indicated this to the ICC;

By ruling in this manner, even though the award states that it appears from the postal operator’s notices of receipt that all of the arbitrator’s communications were received directly by the defendant, the court of appeal, which reversed the burden of proof, violated the above-mentioned texts;

FOR THESE REASONS, and without the need to rule on any of the other grievances:

REVERSE AND ANNUL, in its entirety, the judgement handed down on 15 January 2013 between the parties by the Paris Court of Appeal; return, consequently, the proceedings and the parties to their status quo ante and, for the proceedings to be determined in accordance with the law, transmit them to the Versailles Court of Appeal;

Orders Oktrytoye aktsionernoye obshestvo tomskneft vostochnoi neftyanoi kompanii to the costs;

Pursuant to Article 700 of the Code of Civil Procedure, dismisses the latter’s claims and orders it to pay to Yukos Capital the sum of 5 000 euros;

States that, on the instructions of the Public Prosecutor’s Office of the Court of Cassation, the present judgment will be transmitted to be transcribed in the margin or after the overturned judgment;

Thus done and ruled by the Court of Cassation, First Civil Chamber, and delivered by the President during his public hearing of five November two thousand fourteen.