Applicable law and arbitration. Sulamerica extensively discussed in Kabab-Ji SAL v Kout Food Group.

Update 10 October 2022 In Decision no. 20-20.260 the French Supreme Court confirmed at the end of September 2022: as Reed Smith summarise, faced with an express choice of Paris as the seat of arbitration, and even where the contract is governed by English law, it is the substantive rules of French arbitration law which govern the validity, effectiveness, transfer or extension of the arbitration clause. (Unless parties have made an express choice of law applicable to the arbitration agreement).

Update 3 July 2020 for the opposite view in the same case, opting for the curial law as lex arbitri, see Paris Court of Appeal on 23 June 2020, discussed here. Quite the tale of conflicting views in the same case!

Thank you Filbert Lam for yet again flagging an important case. In [2020] EWCA Civ 6 Kabab-Ji SAL v Kout Food Group Flaux LJ extensively discussed the application of Sulamerica as to the governing law of an arbitration agreement which provides for arbitration in Paris but which is contained in a main agreement which is expressly governed by English law; and as to whether the respondent became a party to the main agreement and/or the arbitration agreement notwithstanding the presence of No Oral Modification provisions in the main contract.

Parties’ choice of English law for the underlying contract was found to also be an express choice of the law governing the arbitration agreement. This meant there was no need to consider the implications (particularly viz a possible implied choice of law) of a choice of Paris as seat or other aspects of the Sulamérica test. Recognition and enforcement of the award which applied French law, was refused.

Jonathan Lim suggests here that the judgment is a departure from the understanding of separability in previous CA decisions, although the ensuing discussion on his feed also suggests that the factual interpretation of the clauses might suggest the exact opposite. I tend to agree with Jonathan: the generic nature of the clauses and the lack of (reported at least) other strong indications seem to suggest the finding of express choice of law was optimistic.

Geert.