April 5th, 2018

ARBITRADE successfully represents its client in ICC arbitration on faulty equipment

The ARBITRADE team has successfully represented its client, a Ukrainian company, in the International Court of Arbitration of the International Chamber of Commerce (ICC), which resulted in a settlement agreement on terms favourable for ARBITRADE’s client. The dispute arose out of a delivery of equipment to the client which did not comply with contractual characteristics. The respondent in the case was an Italian company – the supplier of the equipment.

During the arbitral proceedings the respondent stated that the reason for the defect was the non-compliance of the raw materials used by the claimant in the manufacturing process to the contractual requirements. The respondent also raised a counterclaim for payment by the claimant of the balance under the contract. The dispute was complicated by the disagreement between the parties as to the applicable law: although the contract foresaw the application of the substantive law of Italy, the claimant alleged that the Convention on Contracts for the International Sale of Goods was applicable as part of Italian law, while the respondent claimed that the parties had excluded the application of the convention.

The respondent’s position changed after the first exchange of written submissions in the arbitral proceedings, and the respondent agreed to fully refund the claimant for the money spent on the purchase of the equipment. In the course of negotiations with the participation of ARBITRADE and representatives of the respondent it was agreed that the respondent would also reimbursed ARBITRADE’s client for the arbitration costs. The arbitral proceedings were suspended until the full performance of the settlement agreement by the parties, as a result of which the claimant returned the equipment which had been in its possession for over a year, and received a refund all of the funds spent.

Therefore, ARBITRADE’s lawyers achieved a positive outcome while having minimized the arbitration costs and avoided a lengthy procedure for the enforcement of an arbitral award. The ARBITRADE team working on the case consisted of partner Andriy Shulga and counsel Anastasiya Grenyuk.

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