Third, when the Court of Appeal exercised its inherent power to grant a stay on grounds of handling the case, the Court of Appeal concluded that the principles set out in Tomolugen, supra, were relevant. In the Tomolugen case, it was decided that the tribunal “should take the lead in facilitating the fair and efficient settlement of the entire dispute”. Therefore, when granting a stay on a case-by-case basis, courts should weigh three “higher-ranking concerns”: (1) protecting the plaintiff`s right to choose who and where to bring an action, (2) upholding arbitration agreements, and (3) preventing abuse of process. However, the Court of Appeal cautioned against the “mechanical” application of the principles set out in Tomolugen. Instead, the inherent power of the court to grant a stay of proceedings by handling the case should be exercised “with sensitivity and consideration of the facts and, in particular, the nature of the overlapping issues”. In Monde Petroleum SA v. Westernzagros Ltd, a dispute arose from an advisory contract, which was then settled. The consultation agreement provided for arbitration; the settlement agreement provided for the exclusive jurisdiction of the English courts. A dispute arose as to whether one of the parties had been induced by a false statement to enter into the settlement agreement and whether the courts or an arbitral tribunal had jurisdiction to decide the case. The plaintiff argued that an amount of HK$1,492,753.80 (unpaid amount) was outstanding under 4 orders of the defendant around 2018.
After rounds of negotiations in 2020, the defendant would have confirmed the unpaid amount and agreed to settle the unpaid amount on a certain date, otherwise the plaintiff would have the right to take legal action to recover the unpaid amount plus interest, and the defendant would irrevocably waive and waive any defense, content, reduction or set-off with respect to the unpaid amount. The allegedly agreed terms were set out in a letter from the plaintiff`s lawyers to the defendant (settlement agreement), which was countersigned on behalf of the defendant. The Settlement Agreement also states that it should be governed by the laws of Hong Kong and that “the parties to this Settlement irrevocably agree to submit to the non-exclusive jurisdiction of the courts of the Hong Kong Special Administrative Region to resolve any dispute arising out of or in connection with such settlement” (jurisdiction clause). 40The examination of ordinary infringement cases is quite simple. Since no arbitration clause is available, the parties cannot choose between litigation and alternative dispute resolution until a dispute has arisen. Note that? represents an exogenous probability of an accident in this case. Thus, the ex ante process and comparison sets can be written as and. The choice of parties is discussed in Proposal 1, which shows that comparative rates will increase as litigation costs increase, but decrease as the amount of the case or the uncertainty of the case increases.
The parties will try to avoid costly litigation unless it is worth bearing the legal costs (because the amount at stake is relevant) or the search for a settlement agreement is too costly in terms of concessions to the counterparty (because uncertainty causes the parties` expectations to diverge). On the contrary, the merits of the case are irrelevant. Indeed, what determines the dispute is not the probability of winning in court, but what the parties consider to be that probability. Similarly, the likelihood of an accident is partly relevant, as it only determines the frequency of disputes and not the relative benefits of litigation and resolution. One area where the “one-stop-shop presumption” has been applied is where an agreement is reached to settle disputes arising from a previous agreement between the same parties. A party then attempts to challenge the settlement agreement and make a claim based on the previous contract. III. Settlement agreements in the ICSID-UNCITRAL Arbitration Rules 16We consider the following timetable: At t0, the parties draft the contract and decide whether or not to include an arbitration clause. If they do, the game ends; [14] Otherwise, at t1, an unforeseen eventuality materializes with some exogenous probability and a dispute arises; at that time, each party learns its own type. With t2, the parties decide to settle down or go to court and the game ends. Obviously, we are going backwards in the analysis that follows. The parties have the following information: Since t0, everything is generally known, except for the types of parties that the parties learn as indicated above and the merits of the case (see below), which is still unknown.
23Complete and reorganize, we receive the necessary and sufficient condition for a legal dispute:. Note this and set the billing area or process area. r is positive, increases in c? and c? and decreases in D. When the scope of the dispute falls, the discrepancy between the beliefs of the parties is sufficient to derail attempts at settlement and lead to litigation. Since greater than r and must therefore be positive for a legal dispute to arise, we only have a legal dispute if , which can also be written as. This necessary condition is generally interpreted as a prerequisite for mutual optimism: for a legal dispute to arise, each party`s belief in its own probability of winning in court must be more “optimistic” than the faith of its counterpart. Note that it is not necessary to estimate one`s own probability at more than 50%. therefore, mutual optimism may arise even if the probability of the applicant winning is very low or very high.
The subsequent likelihood of litigation can be estimated from the division of faith as follows: The plaintiff first initiated legal proceedings against the five defendants for alleged copyright infringement. Subsequently, the legal proceedings were stayed on the basis of the appellant`s proposal for a settlement agreement. After delaying the execution of the settlement agreement for a considerable period of time, the respondents finally agreed to the terms of the settlement. However, the applicant protested that it could no longer accept the settlement agreement, arguing that the settlement agreement was no longer valid. 39Not all disputes can be settled ex ante. This is possible in most contractual cases, but not in ordinary crimes, where hypothetically high transaction costs prevent the parties from reaching an agreement before the accident. Some criminal cases where the parties interact indirectly through a third party, such as . B insurer, are similar to contracts and are treated as such below. Do litigation and settlement rates depend on whether or not ex ante arbitration agreements are implemented? How do changes in uncertainty, merit, amount of litigation, litigation costs, and likelihood of a dispute affect the choice of dispute resolution method for torts and contracts? Those are the two issues we are going to address. The court agrees. the prize has been duly submitted. The front of the award reflects the full participation of both parties in the arbitration, which had lasted more than three years at the time the award was filed.
The price reflects the agreement of both parties to the terms and text of the price. It reflects arbitrator Knoll`s due diligence. And the parties` agreement on the price – their determination of its terms – provides a solid basis for its bid. Males J. agreed with the arbitrators that it was clear that the parties intended the arbitration clause of the charterparty to continue to apply if the agreed amount was not paid. What`s the difference? A resolved dispute that is brought before arbitration to convert a settlement agreement into an arbitral award may be treated differently by a court than a dispute in arbitration that is resolved and results in a consent award that reflects the terms of the settlement. 45Clear findings concern the impact of the merits of the case, which is never relevant, as well as the impact of uncertainty and issues on ex ante settlement rates. An increase in uncertainty or participation increases ex post disputes (thus reducing ex post resolution) and therefore also increases ex ante arbitration (further reducing settlement). This result is interesting because it suggests that settlement and arbitration clauses behave as substitutes in terms of the amount involved and the uncertainty of the case: if one increases, the other decreases. However, this does not apply to all other factors studied.
25The residual probability is obviously the probability of ex post invoicing. The following sentence summarizes our comparative static results. The term “pathological clause” was first coined in 1974 by Frederic Eisemann, former Secretary General of the ICC Court of Arbitration. This is an arbitration clause that has been so badly worded that it is potentially invalid and therefore ineffective. The term is still used today. The Settlement Agreement contained an arbitration clause that provided that “any dispute, controversy, claim or difference of any kind” arising out of the Settlement Agreement may be resolved by arbitration (the “Arbitration Clause”). .