Tagsinsolvency, counterclaims, joinder, non-monetary claims, consolidation, interest for use of other's means, forfeit reduction, individual as a party, force majeure, experts, COVID-19
The dispute arose from a supply contract and additional agreements between the Claimant (Supplier) and Respondent (Buyer), concerning delivery of products.
The Supplier made several shipments, confirmed by delivery notes signed by both parties.
However, some paperwork errors were identified but accepted due to their technical nature.
The Buyer failed to make final payments under all agreements. During proceedings, it was established that certain batches of products had not been delivered or had been duplicated in deliveries without any provision for re-delivery in the agreements.
These instances led to reductions in debt amounts owed by the Buyer.
In terms of arbitration fees and representation costs incurred during proceedings; based on Article 15 of Rules governing this case - these should be borne by party against whom arbitral award is made unless otherwise agreed upon.
After calculations considering value of claims granted versus those initially asserted - it was determined that USD25,552.60 should be borne by Respondent while remainder (USD2,380) would be borne by Claimant.
Regarding representation costs claimed at RUB1,650,000; despite objections from respondent citing excessive charges compared to similar cases - tribunal found insufficient evidence provided for comparison hence upheld claimants request as reasonable given complexity & scope involved in this case. The Arbitral Tribunal partially granted the claims of the Claimant against the Respondent ordering them to pay various debts for delivered products under different specifications and additional agreements; interest for use of other person's means under Article 395 of Civil Code for all three agreements; costs of payment of arbitration fee; and costs for legal services on protection rights rendered by Claimant's representative (partially granted). Some asserted claims were rejected by the tribunal.
Economic sectorWholesale and retail trade; repair of motor vehicles and motorcycles
Tagspraejudicialis, arbitration extension / suspension, interest for use of other's means, allocation of fee, allocation of costs, insolvency moratorium, losses
A dispute under the Forwarding Contract for Freight Transportation Organization, pursuant to which the Claimant as forwarder was to provide freight forwarding services to the Respondent as a client, by organising international transportation or transportation across Russia by rail, road, sea or other modes of transport, and the Respondent was to make certain payments in consideration for these services.
The Claimant sought to recover the outstanding additional costs as they could not be calculated prior to the actual provision of these services.
The Respondent believed all his debts under the Contract to the Claimant were already covered.
Moreover, the Respondent emphasised that its cargo (bottles of red wine) was seriously damaged and delayed, which caused the Respondent's losses. Still, it received no solution or answer from the Claimant.
The Respondent is of the view that it does not owe the Claimant “financially or morally”, and that the above points should offset the Claimant’s claims.
The Parties entered into a contract for the supply and installation of imported equipment. The Claimant (Contractor) admitted that, during the performance of the contract, it had failed to meet the time limits set out in the contract because of the difficult economic situation in the world. The Respondent (Client) demanded payment of a penalty for non-performance of the contract and subsequently withheld the amount of the penalty from the payments in favour of the Claimant. Considering the amount of the penalty to be excessive, the Claimant filed a claim to reduce the penalty by recovering the amount of unjust enrichment from the Respondent.
Dispute on the recovery of a penalty for the delay in the performance of work under a work contract. All arguments submitted by the Respondent on the merits of the dispute were recognized by the Arbitral Tribunal as untenable. The claim was entirely dismissed since the period for incurring the penalty was within the moratorium on bankruptcy prescribed by the Russian Government Decree No. 497 of 28.03.2022. This moratorium prohibits accruing penalties.
Dispute on the recovery of a penalty for violation of the terms of delivery of equipment for meeting rooms. The Respondent was certain that the Parties must have anticipated potential setbacks in the equipment delivery schedule due to the ongoing semiconductor crisis in 2021, though such prospects were not explicitly outlined in the contract.
The Respondent's attempts to evade liability in accordance with paragraphs 1 and 3 of Article 401 of the Civil Code of Russia by citing force majeure caused by sanctions restrictions in 2022, were deemed invalid.
The market's inadequacy in providing the necessary goods for the completion of the contract, compounded by the intricate geopolitical situation arising from para. 3 of Art. 401 of the Civil Code of Russia, did not fall under the classification of force majeure circumstances. Moreover, the contract's protocol for exemption from responsibility was not abided by.
The satisfaction of claims was not affected by the moratorium on bankruptcy introduced by the Russian Government Decree No. 497 on 28.03.2022, as there was no dispute between the parties regarding claims for penalty recovery for the period covered by the moratorium.
The parties concluded a contract for the provision of security and safety services. The contract was terminated prematurely due to the Respondent’s improper fulfillment of its contractual payment obligations. The Respondent received certificates of services rendered but avoided signing them. Having accumulated a three-month debt, the Respondent avoided pre-trial settlement of the dispute and did not submit its version of the reconciliation report. The Respondent acknowledged the existence and amount of the debt by signing an agreement on termination and settlement of liabilities concerning termination of the contract, undertaking to settle the debt within the time limit, after the expiration of which the Claimant filed a claim with the RAC.
47.
Arbitral Award on Agreed Terms for case PI4543-22
The dispute concerned the recovery of a forfeit for delayed fulfillment of obligations under a contract for works. Following the hearing, the parties settled the dispute amicably by entering into a settlement agreement. The agreement stipulated a deadline for fulfilling the obligation that had occurred before the Arbitral Tribunal adopted the award, which is not contrary to the law and does not render the arbitral award knowingly unenforceable.
A dispute under the contract for the performance of a complex of works for the construction of facilities. The contracting parties were the Customer represented by the Agent (Claimant) under the contract for the provision of project management services, as well as the Consortium represented by the Consortium Leader (Respondent 1) and the Contractor (Respondent 2).
In connection with the works performance delay, the Claimant filed a claim to the Co-Respondents for the recovery of penalties for works performance delay, for violation of the interim terms of performance, and interest under Art. 395 of the Civil Code of the Russian Federation for the amount of penalties for the period from the moment Respondent 2 received a pre-trial claim till the day of the arbitral award.
The Arbitral Tribunal defined the boundaries of its competence and decided on three main issues: (1) whether the creditor has the right to collect a contractual penalty, and if so, whether the behaviour of the creditor itself affects its amount; (2) whether there are grounds for the interest reduction; (3) whether interest is recoverable on the amount of penalty charged.
