OOO „R Technik“ v. L. T. K.

At a glance

Parties

OOO "R Technik" (Russia), applicant, v. L. T. K., interested person

Case no.

Court of Appeal of Lithuania, civil case No. e2T-37-381/2020 (court process No. 2-60-3-00023-2020-0)

Court

Lietuvos apeliacinis teismas (Court of Appeal of Lithuania), Civil Division: Artūras Driukas (presiding and rapporteur), Dalia Kačinskienė, Asta Radzevičienė

Underlying award(s)

Award No. V2017/106 of 9 April 2018, rendered by a sole arbitrator under the Arbitration Institute of the Stockholm Chamber of Commerce

Treaty

1958 New York Convention, Article V

Sector

Aircraft sale and exchange

Outcome

The award was recognised and declared enforceable in Lithuania (16 April 2020).

Amount

Award recognised for EUR 215,000 (price of the aircraft), a penalty of EUR 92,800, RUB 2,987,194.58 in legal costs, and 7.25% annual interest from the date of the award until payment. L. T. K. is also liable for EUR 34,484.06 and SEK 1,907.81 of the arbitration costs.

The dispute

On 26 September 2015 OOO "Rodina Technik" and L. T. K. signed contract No. 127/01. Under it, L. T. K. was to transfer a Cirrus SR-22 aircraft valued at EUR 215,000, and Rodina Technik was to transfer a Gazelle SA 341 G helicopter valued at EUR 405,000. On 1 March 2016 OOO "R Technik" took over Rodina Technik's rights under an assignment agreement. Clause 6 of the contract provided for arbitration in Stockholm. L. T. K. did not deliver the aircraft. R Technik then obtained an award from a sole arbitrator under the Arbitration Institute of the Stockholm Chamber of Commerce for the aircraft's value, a contractual penalty and costs. R Technik applied to the Court of Appeal of Lithuania for recognition and enforcement. L. T. K. was served personally but filed no response.

Key holdings

1. Article V of the New York Convention lists the only grounds for refusing recognition. The court checks whether those grounds exist and may not review the merits, the facts found, the arbitrator's assessment of evidence or the application of law. ¶ 5
2. The grounds in Article V(1) apply only if the party against whom the award is invoked raises them. L. T. K. filed no response, so the court examined only the Article V(2) grounds, which it must check of its own motion. ¶ 6
3. Arbitrability (Article V(2)(a)): claims for damages and a contractual penalty arising from a contract between a private company and an individual can be arbitrated under Article 12 of the Lithuanian Law on Commercial Arbitration. ¶ 7
4. Public policy (Article V(2)(b)): public policy means international public policy and is read very narrowly. It covers fundamental principles of fair procedure and of constitutional law, and awards obtained by coercion or fraud. The court found nothing showing that recognising this award would breach public policy. ¶¶ 9–10
5. No ground for refusal under Article V(1) or V(2) was established. Award No. V2017/106 is recognised and may be enforced in Lithuania. The ruling took effect when it was made and could be challenged by cassation appeal to the Supreme Court of Lithuania within 30 days. ¶ 11 and operative part

Procedural history

1. 26 September 2015OOO "Rodina Technik" and L. T. K. sign contract No. 127/01, which contains an arbitration clause for Stockholm.
2. 1 March 2016OOO "R Technik" takes over Rodina Technik's rights under an assignment agreement.
3. 9 April 2018A sole arbitrator under the Arbitration Institute of the Stockholm Chamber of Commerce renders Award No. V2017/106 in favour of R Technik.
4. 16 April 2020The Court of Appeal of Lithuania recognises the award and declares it enforceable in Lithuania.

Tribunal, counsel and experts

Decided by

• Artūras Driukas Judge, Court of Appeal of Lithuania (presiding judge and rapporteur)
• Dalia Kačinskienė Judge, Court of Appeal of Lithuania
• Asta Radzevičienė Judge, Court of Appeal of Lithuania

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Keywords

• New York Convention
• recognition and enforcement
• Article V(2)(a)
• arbitrability
• public policy
• international public policy
• SCC
• Stockholm
• Lithuania
• aircraft
• Cirrus SR-22
• Gazelle helicopter
• contractual penalty
• ex officio review
• no review of merits
• assignment of claims

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