Swedish Arbitration Portal: New translated court decision upholds separate award on costs
In a decision recently posted on the Swedish Arbitration Portal, the Svea Court of Appeal dismissed respondent’s challenge to a separate award on costs.
The respondent in the arbitration challenged a separate award on costs, in which the arbitral tribunal had ordered the respondent to reimburse the claimant for part of the advance on costs. Respondent argued that the arbitral tribunal committed a procedural error and exceeded its mandate by rendering an award that did not resolve the dispute on the merits, and that the award should be declared invalid. The Court of Appeal dismissed the challenge in its entirety. The Court explained that the respondent had waived its right to challenge the award based on a procedural error or excess of mandate, having failed to object during the proceedings to the cost issue being decided in a separate award. The Court also noted that in order for an arbitration award to be declared invalid, the award or the manner in which it was rendered must be clearly incompatible with fundamental principles of Swedish law. Article 45(4) of the SCC Rules, which authorizes arbitrators to render separate awards on costs, is not contrary to the Contracts Act or the Swedish Arbitration Act.
The Swedish Arbitration Portal is facilitated by the Arbitration Institute of the Stockholm Chamber of Commerce (the SCC). The project’s mission is to increase transparency in arbitration by making Swedish case law more accessible to the international community.