The case at hand is, to our knowledge, the first and sole decision rendered by French courts in arbitration concerning issues related to the COVID-19 pandemic and its consequences.
Boralex is the French subsidiary of a Canadian company specializing in the construction and the operation of solar and wind farms. InnoVent is a company incorporated under French law specializing in the construction of wind turbines.
On 28 June 2012, Boralex and InnoVent concluded a master partnership agreement for the study and development of six wind power projects hosted by InnoVent and for their priority acquisition by Boralex and a securities repurchase agreement containing an ICC arbitration clause. Since disputes have arisen in relation to these agreements, the dispute relating to the master partnership agreement was referred to the Lille Commercial Court and the dispute relating to the securities repurchase agreement was referred to arbitration by InnoVent, which filed a request for arbitration on 7 September 2018.
The Arbitral Award
By a final award (ICC No. 23916/DDA) issued on 26 Match 2020, an arbitral tribunal sentenced Boralex to pay to InnoVent approximatively EUR 3.8 million for the balance of the repurchase price of securities and approximatively USD 390,000 for the costs of arbitration. The exequatur of this award was ordered by the Paris first instance tribunal on 30 June 2020.
While the arbitral tribunal was unable to meet in person because of the limitations and the lockdown ordered by the authorities as a consequence of the COVID-19 pandemic, each of the co-arbitrators sent their signature and the date of their signature on a separate page to the president of the arbitral tribunal, who sent the award to the ICC with these separate pages and a third page with its own signature dated 26 March 2020 — the last to sign the award.
The Challenge of the Award
On 20 July 2020, Boralex lodged an application to set aside the arbitral award before the Paris Court of Appeals. This application was notably based on the following ground:
“The award failed to state the reasons upon which it is based, the date on which it was made, the names or signatures of the arbitrator(s) having made the award; or where the award was not made by majority decision.”
This ground of annulment is based on the provisions of Article 1492, 6° of the French Code of Civil Procedure (“CPC“) and only applicable to domestic arbitration.
Boralex argued that the award would be null and void because the final document would not have been signed by the three arbitrators, instead they would have just signed extrinsic documents on different dates, which would not permit a certain date to be established for the award. Boralex also argued that this signature process could not be regularized and that the parties did not agree on this process of signature, even though the Terms of Reference had been signed according to these same modalities. It ultimately argued that the collegial deliberation of the arbitrators was not established, and claimed the nullity of the award.
The Decision of the Paris Court of Appeal
The Paris Court of Appeals dismissed Boralex’s argumentation. After highlighting the provisions of Articles 1480, 1481-4° and 1492-6° of the French CPC, it observed that the date of 26 March 2020 was mentioned on the first page of the award and that the signature of the arbitral tribunal’s members and the dates of their signatures were indicated on the last three pages of the award collated by the Secretariat of the ICC, with the president of the arbitral tribunal being the last to sign the award on 26 March 2020.
The Paris Court of Appeals thus considered that the award contained all the signatures as required by Article 1492, 6° of the CPC, and that there was no provision under French law “requiring all arbitrators to sign the award simultaneously on the same page“. It held that the fact that the arbitrators had signed the award on separate sheets of paper had no impact on the validity of the award as long as these pages had been collated as part of the award, all of which had been collated by the ICC Secretariat. Moreover, it outlined the following:
“The fact that the arbitrators signed pages 51 to 51 ter separately does not mean that they would have signed three different awards, whereas the numbering of the award from page 1 to 51 ter establishes that it is a single award and that the date and the signature of each of the arbitrators, on separate sheets but which form an intrinsic part of the award, concern a sole and same award collated from page 1 to 51 ter“.
In addition, it held that these signatures on separate sheets of paper did not:
[“R]aise doubts about the respect of collegiality, nor about the fact that the award was rendered by the majority of the votes, since these sheets were collated with the single original of the award, that no form (written or oral) is imposed by French law for the organization of the deliberation, and that no precise instruction had been established by the ICC at that date for the signature of the award taking into account the recent health constraints, a note having been established by the ICC only on 9 April 2020″.
Finally, the court concluded its ruling on this ground of annulment by specifying that since the president of the arbitral tribunal had been the last to sign the award on 26 March 2020 and that this same date appeared on the first page of the award, these elements were sufficient to give the latter a certain date, without the different dates of signature by the co-arbitrators inducing any irregularity around the deliberations.
Therefore, the court dismissed this ground of annulment and, after considering the other grounds alleged, rejected Boralex’s action for setting aside the award.
Conclusion and Key Takeaways
Although this decision concerns domestic arbitration proceedings and a particular ground of annulment reserved for this matter, we can draw several lessons from it.
Indeed, the French law on arbitration provides in Article 1480 of the CPC that the award shall be made by a majority decision and that it shall be signed by all the arbitrators and in Article 1481 of the same code that the award shall state the date on which it was made. However, no legal provision or arbitration rule requires the award to be signed by the all members of the arbitral tribunal in person, on the same day and on a single exemplar of the award.
The constant development of information technologies and the increasing dematerialization of arbitration have led to changes in practices, some of which have been enshrined in recent revisions of the most widely used arbitration rules. Among the changes in arbitration practices, we can mention the fact that deliberation, drafting and signature of the award can be done by the arbitral tribunals virtually. These developments have permitted more rapidity and flexibility in this often time-consuming phase of the arbitration proceedings.
While these developments in practice have been reinforced since the COVID-19 pandemic, it should be noted that numerous arbitration proceedings were suspended during that crisis, and that the challenged award was rendered at the beginning of the pandemic when no guidelines had been adopted.
The decision of the Paris Court of Appeal is welcomed and gives more certainty to the virtual conduction of arbitral proceedings, including the issuance of the award.
 These facts are reported by GAR in an article published on 7 December 2021, available at: Paris court upholds lockdown award – Global Arbitration Review, visited on 26 February 2022.