Mugikor Laudio 2016 S.L. v. The Bymovil Spain S.L.U.

At a glance

Parties

Mugikor Laudio 2016 S.L. (plaintiff, appellant) v. The Bymovil Spain S.L.U. (defendant, appellee)

Case no.

AAP VI 216/2019 (Auto No. 44/2019, Appeal No. 65/2019; first instance: ordinary proceeding 141/2018, Court of First Instance No. 1 of Amurrio)

Court

Audiencia Provincial de Álava, Section 1 (Vitoria-Gasteiz)

Forum and rules

Spanish court proceedings on an objection to jurisdiction based on an arbitration clause (Chamber of Commerce of Torrelavega arbitration); Spanish Arbitration Act 60/2003; New York Convention Art. II(3)

Treaty

Contract clause 20 (arbitration clause); New York Convention Art. II(3) cited

Court

Mercedes Guerrero Romeo (President), Emilio Ramón Villalaín Ruiz (rapporteur), Silvia Viñez Argüeso

Sector

Commercial agency / distribution contract

Outcome

Appeal allowed. The first-instance order declining jurisdiction in favour of arbitration was revoked, and the Amurrio court was held competent to hear the whole dispute in preference to any arbitral body.

Amount

No costs awarded in either instance.

The dispute

Mugikor Laudio 2016 S.L. sued The Bymovil Spain S.L.U. before the Court of First Instance No. 1 of Amurrio. It sought a declaration that their contract had ended without tacit renewal, together with damages, other sums and a portfolio commission. It later widened the claim to seek a declaration that clauses 14 and 20 of the contract were void; clause 14 waived all compensation. Bymovil objected to the court's jurisdiction under clause 20, which referred any dispute on the "interpretation and/or execution" of the contract to arbitration at law at the Chamber of Commerce of Torrelavega. Mugikor argued that the clause was a standard term imposed on it in an adhesion contract, that it had not clearly and unequivocally agreed to arbitration, that the mandatory rules on agency contracts applied, and that its claims fell outside the clause. The first-instance court first kept jurisdiction (3 September 2018). On reconsideration it reversed itself and declined jurisdiction in favour of arbitration (7 November 2018). Mugikor appealed.

Key holdings

1. A court that hears an objection to jurisdiction based on an arbitration agreement must fully examine whether the agreement is valid, effective and applicable to the claims. A superficial check that an agreement exists is not enough. The court relied on Supreme Court judgment STS 409/2017 of 27 June 2017, which rejects the 'strong' version of kompetenz-kompetenz and cites New York Convention Art. II(3). Legal Ground 2
2. The first-instance court erred: it declined jurisdiction without examining whether clause 20 was valid, effective and applicable to the dispute. It only declared the clause applicable and Art. 54.2 of the Civil Procedure Act inapplicable. Legal Ground 2
3. Clause 20 was a standard contract term drafted in advance by the defendant. Under Art. 9.2 of the Arbitration Act, its validity and interpretation are governed by the rules on adhesion contracts, including the contra proferentem rule. The test is therefore whether the plaintiff clearly and unequivocally accepted arbitration of the claims, even though it is a company and not a consumer. Legal Ground 2
4. The claim that clause 14 is void falls outside a clause limited to the 'interpretation and execution' of the contract, because declaring a clause void is a different task from interpreting it. It was not proved that the plaintiff accepted arbitration in the form the case law requires. The Amurrio court is therefore competent to hear the whole dispute in preference to the arbitral body. Legal Ground 2
5. Costs: under Art. 398(2) of the Civil Procedure Act, no costs are awarded on the successful appeal. No costs are awarded for the first instance either, because an objection to jurisdiction is an incidental issue whose rules do not require a costs order. No further ordinary appeal lies against the decision. Legal Ground 3; operative part

Procedural history

1. 19 June 2018The defendant, served on 14 June 2018, objected to the court's jurisdiction on the basis of the arbitration clause. On 20 June 2018 the plaintiff filed an extension of its claim seeking a declaration that clauses 14 and 20 were void; this was admitted by decree of 27 July 2018.
2. 3 September 2018The Amurrio court held that clause 20 was a standard term made invalid by Art. 54.2 of the Civil Procedure Act, and kept jurisdiction. The same day, on its own motion, it opened a nullity incident on whether the commercial courts might be competent. The judgment says that incident is not shown to have been resolved.
3. 7 November 2018The court granted the defendant's request for reconsideration and, by a further order, declined jurisdiction because the dispute was subject to arbitration. The judgment refers to this order as No. 141/18 and as No. 112/2018, and the operative part dates it 7 July 2018.
4. 29 November 2018The court refused to supplement the two orders of 7 November 2018 with a ruling on costs.
5. 11 December 2018The plaintiff appealed against the order declining jurisdiction. The court records the appeal as lodged on 17 December 2018.
6. 8 April 2019The Audiencia Provincial de Álava allowed the appeal, revoked the order and directed that the ordinary proceeding continue before the Amurrio court.

Tribunal, counsel and experts

Decided by

• Mercedes Guerrero Romeo Judge, Audiencia Provincial de Álava (Presiding judge)
• Emilio Ramón Villalaín Ruiz Judge, Audiencia Provincial de Álava (Rapporteur)
• Silvia Viñez Argüeso Judge, Audiencia Provincial de Álava

For the claimant

Magdalena Pericet Menendez-Valdes · Federico de Miguel Alonso

For the respondent

Cristobal Palacio Ruiz · Alicia Arrizabalaga Iturmendi

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Keywords

• New York Convention Article II(3)
• referral to arbitration
• objection to jurisdiction
• declinatoria
• kompetenz-kompetenz
• validity of arbitration agreement
• scope of arbitration clause
• adhesion contract
• standard contract terms
• contra proferentem
• clear and unequivocal consent
• Chamber of Commerce of Torrelavega
• STS 409/2017
• Spanish Arbitration Act
• agency contract
• Bymovil

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