Author: Erik Mårild**
Published: August 2013
With the judgment T 6238-10, dated February 24, 2012, by the Svea Court of Appeal, the appellate court in Stockholm upheld an award challenged on the grounds that the arbitrator had, against one party’s request, conducted the arbitral proceeding without an evidentiary hearing.1 In addition, extrinsic evidence submitted had been rejected by the arbitrator by reference to the Parol Evidence Rule under New York law. The decision by the Svea Court of Appeal confirms that parties, under Swedish law, may in advance of a dispute bind themselves to “documents only” arbitration. This article discusses two issues, first, whether there is a right to an oral hearing and second, the application of the Parol Evidence Rule in international arbitration.
The factual and procedural background of the case and the decision by the Svea Court of Appeal are set forth in the next sections, followed by a discussion on the right to an oral hearing and a subsequent examination of the application of the Parol Evidence Rule in international arbitration.
II. THE FACTUAL AND PROCEDURAL BACKGROUND OF THE CASE
By a final award dated February 10, 2003, Viva Trade L.L.C. (“Viva Trade”) was ordered to pay a certain amount to Rual Trade Limited (“Rual Trade”). Subsequently, Rual Trade sought to enforce the award against Viva Trade, Roman Romanov, Vladimir Romanov and Ukio Banko Investicine Groupe (“Ukio Banko”). In April 2007, Rual Trade entered into a settlement agreement with Viva Trade, Roman Romanov, Vladimir Romanov and Ukio Banko (together referred to as the “Defendants” in the settlement agreement).
The settlement agreement provided that the defendants were “jointly and severally liable to pay, and agree to pay, or cause to be paid” to Rual Trade three million U.S. dollars in four installments.
*Arbitral & Judicial Decisions
**Associate at Mannheimer Swartling, Stockholm. Member of the New York Bar. The author would like to thank Hans Hammarbäck, partner at Mannheimer Swartling, for his comments on an earlier draft.