B. Cremades & Asociados Despacho de abogados


22 febrero 2017

B. Cremades y Asociados - PRESS RELEASE -
Madrid, 20 February 2017
The Supreme Court of Spain confirms a lower court decision ordering two arbitrators to pay 1.5 million Euros plus interest and costs.
Two arbitrators excluded the third arbitrator (appointed by the multinational PUMA) from the deliberations in an arbitration and, therefore, violated the principle of “arbitral collegiality.” Consequently, the arbitral award was set aside for the violation of Public Order (Judgment of 10 June 2011 of Section 28 of the Provincial Court of Madrid ‐ JUR2011256573). In the re‐submission arbitration proceeding, PUMA reduced the awarded damages in excess of 60% (from EUR 98 million to EUR 42 million).
PUMA to sought damages from the arbitrators of the original arbitration proceeding. As aresult, in its ruling of 20 September 2013, the Court of First Instance No. 43 of Madrid considered that the two arbitrators committed a manifest, serious and inexcusable error, pursuant to the liability provision of the Spanish Arbitration Act, and ordered them to compensate PUMA for the damages and losses suffered, which were at least the amounts that the arbitrators received from PUMA for the performance of their arbitral duties (750.000 Euros each). The reason was that a new arbitration proceeding had to be lodged given that the prior award had been declared null and void (because the two arbitrators excluded the arbitrator appointed by PUMA from the deliberations).
The two arbitrators appealed. In its judgment of 27 October 2014 (JUR 2016247028), Section 8 of the Provincial Court of Madrid confirmed the judgment of the Court of First Instance, ordering the two arbitrators to bear the procedural costs of the appeal.
The two arbitrators in turn appealed to the Supreme Court of Spain. In its recent judgment of 15 February 2017, the Supreme Court of Spain upheld the ruling against the two arbitrators who, in the words of the Supreme Court, "ha[d] palpably violated the arbitration rules". The Supreme Court again ordered the two arbitrators to bear the procedural costs of the appeal.
PUMA was represented by the law firm of B. Cremades and Asociados in collaboration with the French law firm of De Gaulle Fleurance & Associes in the second arbitral proceeding, the annulment of the award and the liability of the arbitrators. B. Cremades & Asociados was founded in 1969 by Bernardo M. Cremades and, since then, it has established itself as one of the leading law firms in arbitration. The firm is focused on the resolution of disputes at national and international levels, as well as advising on corporate, financial, administrative and tax law. Further information on our firm may be found at www.bcremades.com.