State of Montenegro v. CEAC Holdings Limited

At a glance

Parties

State of Montenegro (applicant; counterclaimant in the arbitration) v. CEAC Holdings Limited (Cyprus)

Case no.

General Application No. 58/18

Court

District Court of Nicosia (Επαρχιακό Δικαστήριο Λευκωσίας), Cyprus

Forum and rules

Application to register and enforce a foreign arbitral award under the New York Convention (ratified by Cyprus Law 84/79) and the International Commercial Arbitration Law 101/87

Underlying award(s)

Final Award of 12 January 2017 by a three-member tribunal in Vienna, Austria, and Correction to the Final Award of 2 March 2017

Treaty

Arbitration clause in a Settlement Agreement dated 16 November 2009

Tribunal

Χ. Β. Χαραλάμπους, Senior District Judge (Α.Ε.Δ.)

Outcome

Application granted (30 April 2020). The award was registered for enforcement and costs were awarded against CEAC.

Amount

The award ordered CEAC to pay EUR 324,000 to Montenegro. Costs of the application awarded to Montenegro, to be assessed, plus VAT.

The dispute

The State of Montenegro asked the District Court of Nicosia to register for enforcement an arbitral award of 12 January 2017. A three-member tribunal in Vienna issued the award on Montenegro's counterclaim, in a dispute arising from a Settlement Agreement dated 16 November 2009 that contained an arbitration clause. The award, as corrected on 2 March 2017, ordered CEAC Holdings Limited, a Cyprus company, to pay EUR 324,000 to Montenegro. CEAC opposed the application on nine grounds. It argued that the court lacked jurisdiction because Austria had not been shown to be a party to the New York Convention, which mattered because of Cyprus's reciprocity declaration. It also argued that the copies of the award and the Settlement Agreement were not duly certified and that the translations were inadequate. CEAC raised no defence under Article V. (The file also contains an unrelated 2000 judgment of the Italian Corte di Cassazione between Krauss Maffei and Bristol Myers Squibb. It has no bearing on this case.)

Key holdings

1. Jurisdiction upheld. Cyprus applies the Convention only to awards made in the territory of another Contracting State, under the reciprocity declaration it made on accession on 29 December 1980. Austria acceded to the Convention on 2 May 1961. The court accepted proof of this from an uncontradicted printout of the newyorkconvention.org country list. Law 103(I)/02 does not make the Official Gazette or a certificate of the Foreign Minister the only means of proving such facts. pp. 3–4
2. The applicant bears the burden of supplying the documents listed in Article IV. Once it has done so, the burden shifts to the resisting party to prove an Article V ground, and those grounds are limited (following Beogradska (1995) 1 A.A.D. 737). CEAC raised no Article V defence. pp. 4–5
3. The copy of the Final Award and the Correction is duly certified under Article IV. A Vienna notary certified it on 13 July 2017, and Apostilles were added on 18 July 2017 and 18 October 2017. Under Article 3 of the Hague Apostille Convention (Law 50/72), the Apostille is the only formality that can be required to authenticate the signature, capacity and seal. pp. 5–7
4. The copy of the Settlement Agreement is duly certified. The Basic Court in Podgorica certified it and affixed an Apostille. Two passages that the translator marked as illegible do not affect the substance of the certification. pp. 7–9
5. The translations are adequate. Article 35 of Law 101/87 allows the court to proceed without translations of documents in a language it understands. In any event, the sworn translations by Mr Solomou were made by a qualified person and were not challenged. Translating the earlier translator's stamps was not required. pp. 9–10
6. All the conditions for registration were met. An order was issued as sought in paragraph A of the application, with costs to Montenegro, to be assessed, plus VAT. p. 11

Procedural history

1. 16 November 2009Settlement Agreement containing the arbitration clause concluded.
2. 12 January 2017Final Award issued in Vienna on Montenegro's counterclaim, ordering CEAC to pay EUR 324,000.
3. 2 March 2017Correction to the Final Award issued.
4. 13–18 July 2017Copy of the award notarised in Vienna (13 July 2017) and apostilled (18 July 2017). A further notarial statement followed on 12 October 2017 and a further Apostille on 18 October 2017.
5. 2018Montenegro files General Application No. 58/18 in the District Court of Nicosia. CEAC files an objection.
6. 5 August 2019Montenegro files, with leave, a supplementary affidavit on Austria's accession to the Convention and on the certification of the documents.
7. 30 April 2020District Court of Nicosia grants the application and registers the award for enforcement, with costs.

Tribunal, counsel and experts

Decided by

• Χ. Β. Χαραλάμπους Judge, District Court of Nicosia

For the claimant

Ιωαννίδης Δημητρίου Δ.Ε.Π.Ε. (Ioannides Demetriou)

For the respondent

Πατρίκιος Παύλου & Συνεργάτες Δ.Ε.Π.Ε.

Run a conflict check on these names →

Keywords

• New York Convention
• Article IV
• Article V
• recognition and enforcement
• Cyprus
• Montenegro
• reciprocity reservation
• Austria
• Vienna arbitration
• certified copy
• Apostille
• Hague Apostille Convention
• translation requirement
• Law 84/79
• Law 101/87
• settlement agreement
• counterclaim

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