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International Arbitration Forum

Gerechtshof Amsterdam (Court of Appeal of Amsterdam), 29 January 2019

Case summary

At a glance

Parties
[X] (applicant, lender) v. [Y] (respondent, borrower; did not appear) — names anonymised
Case no.
Gerechtshof Amsterdam, No. 200.234.175/01; ECLI:NL:GHAMS:2019:192
Court
Gerechtshof Amsterdam (Court of Appeal of Amsterdam), civil and tax law division, team I
Underlying award(s)
Three net-ARB, Inc. online arbitration awards, case nos. 25633 and 25635 (12 February 2014) and 25797 (16 April 2014)
Forum and rules
Enforcement under Articles 1075 and 1076 of the Dutch Code of Civil Procedure and the New York Convention 1958
Treaty
New York Convention 1958, Article V(2)(b)
Sector
Bitcoin lending; online peer-to-peer platform (BTCjam)
Outcome
Leave to enforce all three awards refused as contrary to public policy; the applicant was ordered to pay the costs, assessed at nil.
Amount
The awards ordered payment of 0.42000000, 0.09555000 and 0.00556500 bitcoins. Nothing enforced.

The dispute

[X] lent bitcoins to [Y] at 5% interest per month through www.btcjam.com, an online platform for bitcoin loans. The principal sums were 0.4, 0.091 and 0.0053 bitcoins. The platform's Borrower Registration and Membership Agreement provided that a loan more than 90 days overdue would be sent to arbitration. A borrower who wanted to contest the claim had to email support@btcjam.com within seven days of a Notice of Default and pay a USD 99 fee. Three awards were issued against [Y] by net-ARB, Inc., a Georgia (USA) company acting as sole arbitrator. They were signed by its CEO and did not state the place of arbitration. [X] asked the Amsterdam Court of Appeal for leave to enforce the awards in the Netherlands under Article 1076 of the Dutch Code of Civil Procedure (Rv) or, in the alternative, under Article 1075 Rv and the New York Convention. [Y] had no known address and did not appear.

Key holdings

  1. The Court has jurisdiction because [X] intends to enforce within the Amsterdam district, even if [Y] has no domicile there. The arbitration law in force since 1 January 2015 applies because Dutch law did not govern the arbitrations. ¶ 3.1
  2. The court may raise public policy on its own motion. It may refuse leave even though the respondent filed no defence and reportedly told the applicant he would not resist enforcement. ¶ 3.3
  3. An award is contrary to public policy if its content or the way it came about conflicts with principles that Dutch law treats as fundamental. Under the platform's clause, an arbitration started automatically once the 90 days had passed. Nothing shows that the arbitrator or any administrator told [Y] of the proceedings or the claim, or gave him a proper opportunity to defend himself. ¶¶ 3.4–3.5
  4. This breached the principle of audi alteram partem (the right to be heard). The principle is fundamental even in arbitration conducted mainly by email. Enforcement would therefore violate public policy under Article 1076(1)(B) Rv and Article V(2)(b) of the New York Convention. ¶ 3.5
  5. Leave is refused on every ground [X] relied on. The Court did not need to decide two further issues: that the tribunal differed from the one named in the clause (Dhami Law Firm), and that the awards did not show the arbitrations took place in California as agreed. [X] bears the costs, assessed at nil. ¶ 3.6; ¶ 4

Procedural history

  1. 12 February 2014net-ARB, Inc. issues awards in cases 25633 and 25635 against [Y].
  2. 16 April 2014net-ARB, Inc. issues the award in case 25797.
  3. 27 February 2018[X] files a request for leave to enforce the three awards with the Amsterdam Court of Appeal.
  4. 1 August 2018Oral hearing adjourned because [Y] had been summoned by ordinary letter instead of by bailiff's writ.
  5. 22 August 2018Hearing continues without [Y], who was summoned under Article 54(2) Rv after notice in the Staatscourant of 10 August 2018.
  6. 29 January 2019Judgment: leave to enforce refused on public policy grounds.

Tribunal, counsel and experts

Decided by
For the claimant
M.R. van Buiten

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Keywords

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

Case ID
Gerechtshof Amsterdam (Court of Appeal of Amsterdam), No. 200.234.175/01
Country
Section

Court: Netherlands, Gerechtshof Amsterdam (Court of Appeal of Amsterdam)
Date of decision: 29 January 2019
Case number: 200.234.175/01
New York Convention provisions: V | V(2) | V(2)(b)
Source: New York Convention case law case database.