Dampskibsselskabet Norden AS v. Zamin Amapa Mineracao S.A.

At a glance

Parties

Dampskibsselskabet Norden AS (applicant) v. Zamin Amapá Mineração S.A. (respondent)

Case no.

Sentença Estrangeira Contestada (Challenged Foreign Award) No. 15.750 (2016/0145366-5)

Court

Brazil, Superior Tribunal de Justiça, Corte Especial (Special Court)

Underlying award(s)

Arbitral award of 29 October 2015, rendered by an arbitral tribunal in London

Treaty

New York Convention (Articles V, V(1), V(2), per the case database); Brazilian Arbitration Law No. 9.307/1996, Articles 37–39

Court

Minister Nancy Andrighi (Rapporteur); Minister João Otávio de Noronha (President of the session); 11 other Ministers concurring

Sector

Shipping; iron ore carriage

Outcome

Recognition (homologação) of the London award granted unanimously on 21 November 2018; the public policy objection based on denial of the right of defence was rejected.

Amount

Award: about USD 4.29 million against Zamin. Costs: Zamin to pay court costs and attorneys' fees of 10% of the value of the cause, which equals the economic value of the award.

The dispute

Norden had time-chartered a vessel. It then contracted with Zamin to carry iron ore in that vessel from Brazil to a port in northern China, through the Panama Canal. The iron ore cargo liquefied, which created a serious risk that the ship would sink. The voyage was stopped, the ore was discharged and the vessel was returned to its owner. The owner started arbitration against Norden, and Norden started arbitration against Zamin. With the agreement of all three parties, the two proceedings were heard together in London, and Zamin was ordered to pay about USD 4.29 million. Norden asked the Superior Court of Justice to recognise the award in Brazil. Zamin objected that recognition would breach Brazilian public policy. It argued that its insolvency, and its request for judicial recovery filed on 31 August 2015, had prevented it from defending itself in the arbitration.

Key holdings

1. The formal requirements under Articles 216-C, 216-D and 216-F of the Court's Internal Rules and Articles 37–39 of Law No. 9.307/1996 were met. The parties had capacity, the arbitration agreement was valid, the dispute concerned disposable property rights, notice was given, and the award stayed within the limits of the arbitration agreement. Vote, Section 1
2. The award is final. Finality can be inferred from the award itself read together with the rules that governed the arbitration. Here those rules allowed 28 days to challenge the award, and a letter confirmed that Zamin had filed no challenge or appeal against the award of 29 October 2015. Ementa ¶ 3; Vote, Section 1
3. Recognition only gives a foreign award legal effect in Brazil. Zamin's insolvency does not prevent recognition: any enforcement will follow later under Brazilian law, including Law No. 11.101/2005 on judicial recovery. The Court relied on SEC 14.408/FR. Vote, Section 1
4. There was no denial of the right of defence and so no breach of public policy. Zamin's insolvency arose after the arbitration began. The Arbitration Act 1996 (section 36) does not require parties to be represented by lawyers, and hearings and documents could have been handled online at low cost. Zamin did not pay the security despite many extensions. It never asked for the security to be reduced or for the proceedings to be suspended. It was excluded because it abandoned the arbitration, which was the effect of its own default. Ementa ¶ 5; Vote, Section 2
5. Zamin must pay the court costs and attorneys' fees of 10% of the value of the cause, which equals the economic value of the award. The bankruptcy and judicial recovery court in São Paulo (No. 1088747-75.2015.8.26.0100) is to be notified. The operative paragraph of the vote, as published, says the request is granted 'in part' and 'only in relation to' one Carlos Alberto Resende Sobral. However, the judgment and the certificate of judgment record a unanimous grant of recognition. Vote, Sections 3–4; Certidão de Julgamento

Procedural history

1. 31 August 2015Zamin files for judicial recovery in Brazil.
2. 29 October 2015The London arbitral tribunal renders its award ordering Zamin to pay about USD 4.29 million.
3. 18 May 2016Norden files its request for recognition with the Superior Court of Justice.
4. 8 March 2018The case is assigned to Minister Nancy Andrighi.
5. 21 November 2018The Special Court unanimously grants recognition of the award. The judgment is published in the DJe on 27 November 2018.

Tribunal, counsel and experts

Decided by

• Nancy Andrighi Judge, Superior Tribunal de Justiça, Corte Especial (Rapporteur)
• João Otávio de Noronha President, Superior Tribunal de Justiça, Corte Especial (President of the session)
• Laurita Vaz Judge, Superior Tribunal de Justiça, Corte Especial
• Humberto Martins Judge, Superior Tribunal de Justiça, Corte Especial
• Maria Thereza de Assis Moura Judge, Superior Tribunal de Justiça, Corte Especial
• Herman Benjamin Judge, Superior Tribunal de Justiça, Corte Especial
• Napoleão Nunes Maia Filho Judge, Superior Tribunal de Justiça, Corte Especial
• Jorge Mussi Judge, Superior Tribunal de Justiça, Corte Especial
• Og Fernandes Judge, Superior Tribunal de Justiça, Corte Especial
• Luis Felipe Salomão Judge, Superior Tribunal de Justiça, Corte Especial
• Benedito Gonçalves Judge, Superior Tribunal de Justiça, Corte Especial
• Raul Araújo Judge, Superior Tribunal de Justiça, Corte Especial
• Felix Fischer Judge, Superior Tribunal de Justiça, Corte Especial

For the claimant

Luiz Roberto Leven Siano · Tainá Magalhães dos Santos

For the respondent

Clyde & Co · Marco Antonio Lotti · José Rogério Lima de Araújo · Fábio Roberto Lotti · Edson Fernandes Junior · Rodolfo Silveira da Silva

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Keywords

• recognition of foreign arbitral award
• homologação
• New York Convention
• public policy
• right to be heard
• denial of right of defence
• default
• insolvency
• judicial recovery
• security for costs
• charterparty
• iron ore
• cargo liquefaction
• London arbitration
• Arbitration Act 1996
• Brazilian Arbitration Law 9.307/1996
• finality of award
• Norden

Summary generated with AI from the published documents — refer to the award for the authoritative text.