Carte Blanche (Singapore) PTE, Ltd. v. Carte Blanche International, Ltd. 888 F.2d 260 (2d Cir. 1989)* – Vol. 1 No. 1

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Author: Hans Smit

Published: March 1990

United States
Arbitral Awards
Appeal to Arbitral Tribunal and Annulment

Description: Arbitrators generally view judicial attacks on their awards with mixed emotions. On the one hand, such attacks frustrate the aim of arbitration to achieve a final and dispositive adjudication by the arbitral tribunal; but, on the other hand, attacks on awards produce the collateral benefit of making the award attacked part of the public judicial record and of thus affording a look at how arbitrators decide the steadily growing number of international disputes that are submitted to them.

Publication of awards can serve various beneficial purposes. It exposes the awards to public scrutiny and therefore encourages arbitrators to be particularly concerned about the quality of their efforts. It gives the public at large access to a growing body of rules of private international law, as distinguished from the conflict of laws, in both procedural and substantive areas. Additionally, it provides prospective litigants a most useful source of information on which to base their selection of arbitrators. I am strongly of the view that the advantages of publication greatly outweigh its disadvantages and therefore welcome any opportunity of making public arbitral awards without offending the parties’ justified expectations of secrecy.

In the particular case at hand, the publication of the award serves two additional purposes: it permits scrutiny of the courts’ continuing tendency to review awards to a larger extent than is warranted; and it permits one of the arbitrators who rendered the award to review the court’s review of his award.

The arbitration in this case was conducted under the Rules of the ICC International Court of Arbitration. The Claimant was a Singapore corporation that had been franchised by the Respondent, an American corporation, to carry on a credit card business in Malaysia, Singapore and Brunei. Claimant claimed that Respondent had breached the franchise agreement by wrongfully withholding benefits to which the Claimant was entitled. Respondent denied this, and the Claimant counterclaimed asserting various breaches by the Claimant of the franchise agreement. Included in these asserted breaches was the allegation that the shareholders of Claimant had transferred fifty percent of the shares in the holding company to a third party. Respondent claimed that these transactions ran afoul of provisions of the franchise agreement that prohibited the Claimant from assigning the franchise agreement and from selling all or part of its business without having afforded Respondent a right of first refusal.

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