Court of Cassation, No. 14-20.924

Court of Cassation, First Civil Chamber, 21 October 2015, No. 14-20.924

Judicial Chronology:

Award in Kuala Lumpur, 8 February 2012

Paris Tribunal of Grande Instance, 17 September 2012

Paris Court of Appeal, 6 May 2014, No. 12/21230

UMA HOLDING UNITED MARITIME ALLIANCE HOLDING (UMA)

Vs.

MISC BHD (MISC)

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

Whereas, according to the judgment under appeal (Paris, 6 May 2014), UMA and MISC have concluded an agency contract subject to Malaysian law which included an arbitration agreement under the rules of the Kuala Lumpur Regional Arbitration Centre; whereas the award rendered in Malaysia ordering UMA to pay various sums to MISC was declared enforceable in France by order of the President of the Paris Tribunal of Grande Instance;

On the first ground:

Whereas UMA, represented by its liquidator, objects to the judgment which confirms the enforceability of the arbitral award, then, according to the ground of appeal:

1°/ that the judge must respect due process (in French Principe de la contradiction); that he/she cannot raise a ground of appeal of his/her own motion without first inviting the parties to submit their observations; that in the present case, in order to prevent the application of Directive 86/653 in the matter of controlling the conformity of the award with international public policy, MISC limited itself to claiming that the said directive would not be a domestic mandatory rule assimilated to international public policy; that MISC claims neither that the contract in the present case would have been a maritime agency contract excluded from the scope of application of the Directive, nor that the transposition law of 25 June 1991 would be different in nature from the Directive it transposed in that it would have extended the scope of application of the said Directive; that, in order to set aside the claims of UMA, the Court of Appeal did not rely on the circumstance, claimed by MISC, that the Directive did not fall within the scope of international public policy, but on the different circumstance that the contract was, in the present case, a maritime agency contract excluded from the scope of the Directive, and that the transposition law of 25 June 1991 had extended the scope of application of the said Directive and that, for this extension, it fell within the scope of domestic public policy only; that by raising this ground of appeal without inviting the parties to submit their observations, the Court of Appeal infringed Article 16 of the Code of Civil Procedure;

2°/ in any event, whether that a norm belongs to international public policy or to domestic public policy does not depend on the source, international or domestic, of the norm, but only on the essential nature of the interest protected; that in the present case, by affirming that the provisions of the 1991 transposition law would fall within the scope of domestic public policy and not international public policy only because the relevant provisions fell within an extension of the initial scope of the Directive, without considering whether the aim pursued by this law would not be so essential as to justify its application on the grounds of international public policy, the Court of Appeal deprived its decision of a legal basis in the light of Article 1520-5 of the Code of Civil Procedure ;

But whereas, MISC argued in its submissions, in response to the claim of the company UMA on the application of EC Directive 86/653 of 18 December 1986, that the protection of commercial agents did not fall within the scope of international public policy and that mandatory rules must be distinguished from international public policy. The ground on the scope of application of the directive was therefore in the debate and was not raised by the Court of Appeal on its own motion. After holding that the shipping agency contract between UMA and MISC did not fall within the scope of application of Directive 86/653 of 18 December 1986, but within that of the transposition law of 25 June 1991, the provisions of which concerning service contracts fell exclusively within the scope of domestic public policy, the Court of Appeal rightly dismissed the claim that it was contrary to international public policy; that the ground of appeal was unfounded;

On the second ground:

Whereas UMA, represented by its liquidator, makes the same complaint in the judgment, then, according to the ground of appeal:

1°/ that UMA Holding argued that if part of the career of the arbitrator, Mr. X…, was public knowledge, in particular his academic and judicial career, the curriculum vitae transmitted on 5 November 2009 was truncated in that it did not mention his past functions at the Ministry of Industry and the customs and tax authorities. Consequently, UMA could not have known that Mr. X… carried out those functions and could not, for that reason, have questioned the lack of independence of the arbitrator earlier. In order to hold that UMA should have raised the arbitrator’s lack of independence earlier, the court of appeal held that the arbitrator’s curriculum vitae was sent to it on 5 November 2009 and that it was subsequently informed of the arbitrator’s career in the Malaysian judicial institution, his participation in specialised legal commissions, his membership of international organisations and arbitration institutions and his academic career. In so ruling, without replying to the claim that the curriculum vitae sent by Mr. X.. X… was truncated, which prevented UMA Holding to be aware of his past career at the Ministry of Industry and the customs and tax authorities, the Court of Appeal infringed Article 455 of the Code of Civil Procedure;

2°/ that, supposing that by stating that UMA “does not report information that it would not have been in a position to know”, the court of appeal heard that it would be up to UMA to prove that it was not in a position to know about Mr. X’s past career … to the Ministry of Industry and the customs and tax services, the court of appeal then reversed the burden of proof, in violation of Article 1315 of the Civil Code ;

But whereas, after noting that UMA did not provide any information that it would not have been able to hear, the Court of Appeal decided, by a reasoned decision and without reversing the burden of proof, that the ground arising from the arbitrator’s lack of independence invoked before the annulment judge was inadmissible during the review of the award; that the ground of appeal was unfounded;

FOR THESE REASONS:

DISMISSES the appeal;

Orders SCP Y… and Z…, taken in the person of Mr Y…, as liquidator in the judicial liquidation of the company UMA, to pay the costs;

Pursuant to Article 700 of the Code of Civil Procedure, dismisses the application of SCP Y… and Z…, in the person of Mr Y…, in his capacity as liquidator in the judicial liquidation of the company UMA, and orders it in the same capacity to pay the company MISC the sum of 3,000 euros;

Thus, done and judged by the Court of Cassation, First Civil Chamber, and pronounced by the President at a public hearing on the twenty-first of October two thousand and fifteen.