Court of Cassation, No. 18-23.176

Court of Cassation, First Civil Chamber, 4 December 2019, No. 18-23.176

Challenged decision: Paris Court of Appeal, Pole 1 - First Chamber, 29 May 2018, No. 16/12944

SA PRIOSMA LIMITED

vs.

SAS CAT SA

THE COURT OF CASES, FIRST CIVIL COUNCIL CHAMBER, issued the following judgment:

Whereas, according to the facts as stated in the judgment under appeal (Paris, 29 May 2018), by letter and email dated 30 September 2013, the Covea Group appointed the Bermuda law company, KBS International, later named Priosma, as broker for the placement of some of its reinsurance programmes on the Bermuda market, to replace the company of the same right, Kitson Brokerage Services (KBS) to which this mission had been entrusted, under the terms of an agreement dated 16 February 2011, by Cat, the group’s captive reinsurance brokerage company.

Cat initiated arbitration proceedings on the basis of the arbitration clause stipulated in the 2011 contract because of a dispute between the parties regarding the payment of commissions, in which a portion of the commissions was to be retroceded; by an award issued on 10 May 2016, the arbitral tribunal, ruling in amicable composition and after declaring that it had jurisdiction, ordered Priosma to pay Cat a certain amount as retrocession of the commissions received;

On the second and third parts of the first ground and on the second ground:

Whereas it is not necessary to rule by a specially reasoned decision on these complaints which are not of such a nature as to lead to cassation;

On the first part of the first ground:

Whereas Priosma complains that the judgment dismissed the claimant’s request to annul the award. Then, according to the ground that, if the arbitration clause is contained in a document referred to in the main contract, it is binding on the party if the latter was aware of the arbitration clause when the main contract was concluded. The court of appeal dismissed the ground based on the arbitral tribunal’s lack of jurisdiction over Priosma because it merely considered that the 2013 contract concluded between Priosma and Covea did not have substance without its reference to all the provisions of the 2011 contract, and concluded that KBS International’s consent had necessarily related to all of them, including the arbitration clause. Thus, without finding that KBS International was aware of the arbitration clause contained in the 2011 contract at the time of the conclusion of the contract in 2013, the decision of the Court of Appeal lacks legal basis under Article 1520-1 of the Code of Civil Procedure;

Whereas, however, the judgment notes, first, that the letter and e-mail of 30 September 2013 only confirmed the designation of KBS International as broker, ordered the transfer to that company of all files and responsibilities held by KBS Ltd, and specified that the financial terms remained those agreed with the previous contracting party. Then it noted that the 2013 contract was devoid of substance without its reference to all the provisions of the 2011 contract and that Priosma was necessarily aware of the 2011 contract, which alone set out the rights and obligations of the parties. Thus, the Court of Appeal demonstrated Priosma’s acceptance, at the time of the conclusion of the contract, for the arbitration clause contained in the 2011 contract, and legally justified its decision;

FOR THESE REASONS:

Dismisses the appeal;

Orders Priosma to pay the costs;

Pursuant to article 700 of the Code of Civil Procedure, dismisses its request and orders it to pay the company Cat the sum of 3,000 euros;