Chapter 6

Question 1

Why is a written arbitration agreement important?

Question 2

By what means can an arbitration agreement ‘in writing’ come into existence?

Question 3

What is meant by incorporation of an arbitration agreement? By what means can incorporation be effected?

Question 4

What is a dispute?

Question 5

Explain the doctrine of severability of the arbitration clause

Question 6

What are the requirements of a valid notice of arbitration?

Question 7

What are the requirements of a valid notice of arbitration?

Question 8

Examination-style questions
* In 2009, A (in England) and B (in Switzerland) made a contract for the sale to B of 20,000 second-hand books. The arbitration clause stated that any defects, other than torn, dirty or dog-eared pages, were to be notified to A within one month of delivery and that any disputes were to be settled in Rome by an arbitrator appointed by the President of the International Institute of Bibliophiles.

In 2010, A and B made a contract for the sale to B of 20,000 CDs as listed and priced in A’s catalogue. The contract stated ‘all other terms as in our 2009 contract’.

B says that 40% of the CDs delivered are cracked, warped or otherwise corrupted. Should B start an arbitration, or go to court? (If the latter, which court?)

• Discuss the differences between Option I and Option II of the Model Law’s Article 7, the Form of the Arbitration Agreement. Which definition has your country’s legislation adopted? Do you see any potential problems arising if a country adopts Option II?
• Seller is a Bermuda company doing business in its Hong Kong office, and Buyer is located in Brazil. The goods are patented pharmaceutical products being produced in Switzerland. Draft a suitable arbitration clause for these parties, who have already orally agreed, if a dispute arises, to have an ad hoc arbitration.