2019/05/16 – 23 Cdo 3439/2018 (summary)

Resolution of the Supreme Court of 16 May 2019, Ref. No. 23 Cdo 3439/2018
(arbitration agreement, qualified electronic signature, New York Arbitration Convention)

The present case concerns question of formal requirements for the conclusion of arbitration clause. The court of first instance, as well as the court of appeal, ruled that they do not have the jurisdiction to decide the case since the case ought to be decided within the arbitration proceedings. Particularly, the court of appeal found that there was an exchange of e-mail messages containing the contract between the parties where the defendant demanded legal predecessor of the claimant to send her signed and stamped contract back via e-mail, and where the predecessor of the claimant responded by sending the signed contract attached to the e-mail (together with the invoice for the advance payment). According to the court of appeal the requirement of written form of the arbitration contract was satisfied in accordance with the Section 3 (1) of the Law No. 216/1994 in Coll., on the arbitration proceedings and on the enforcement of the arbitral awards. According to this provision, the written form is equally preserved when the arbitration agreement is agreed upon by telegraph, telex or electronic means which enable to caption content and parties to an agreement. The appeal court stressed that an arbitration agreement is concluded in the written form even without physical presence of signatures of parties on the document containing the arbitration agreement.

Within the extraordinary appeal procedure, the Supreme Court assessed the question of validity of an arbitration contract concluded between parties from different states in international trade relations by exchanging e-mails without qualified electronic signature. It firstly determined what legal framework applies to the legal form of the arbitration agreement if the parties are Czech and Spanish legal entity by assessing two international treaties - the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards (“the New York Convention”) and the European Convention on International Commercial Arbitration (“European Convention”). Then, it had to consider whether there is a possible conflict between the two legal instruments, and finally, it had to determine which of the two should be considered as the special treaty. The Supreme Court firstly stated that both treaties are essentially identical regarding formal validity of arbitration contracts and as such are basically equivalent. In relation to the form of arbitration agreement, the New York Convention contains unified substantive direct norm and therefore its Art. II represents unified maximum standard as to the formal requirements of arbitration agreements. Regarding the question which of the treaties is lex specialis, it took into consideration that the New York Convention regulates narrower the question of the form and that it contains direct norm regarding the form of the arbitration contract, whereas the European Convention contains only a conflict rule. Therefore, it considered the New York Convention as lex specialis.

The Supreme Court then noted that the New York Convention does not contain exhaustive list of the forms of agreement in writing (i.e. not only letters or telegrams). Furthermore, it pointed out to the recommendations of the UN Commission on international trade law UNCITRAL, as well as the decisions of Indian and American courts, where the arbitration agreement was considered valid even in case where e-mails were exchanged. Therefore, the Supreme Court considered that the requirement stipulated in Art. II of New York Convention, namely that the arbitration agreement should be included in the exchange of letters or telegrams, encompasses also exchange of communication via e-mail. Additionally, Supreme Court reached the same conclusion in its previous case-law concerning the written form of the agreement of delivery of goods under the Vienna Convention on Contracts for the International Sale of Goods.

Finally, the Supreme Court addressed the question of necessity of the qualified signature in the agreement. It used an analogy with telegram which is equally not possible to sign and therefore there was no reason to rule otherwise in case of an e-mail. The Supreme Court supported this claim by pointing at the case-law of other foreign jurisdictions and also to Art. 17 of Directive 2000/31/EC on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market. The Supreme Court held that the requirement of qualified signature is excessive and in conflict with unified maximum standard in Art. II of New York Convention which does not require the signature of parties. It therefore concluded that an arbitration agreement, within the international trade relations between two parties from different states, can be validly concluded even by exchange of e-mails not containing qualified electronic signature.