TRADHOL INTERNATIONAL SA SOCIEDAD UNIPERSONAL vs SHAKARGANJ LIMITED S

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TRADHOL INTERNATIONAL SA SOCIEDAD UNIPERSONAL VS SHAKARGANJ LIMITED S. 7---New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958, Art. II, cl. 2 & Art. V (1) (a)---Invalidity of agreement---Electronic communication---Plea raised by objector to award was that agreement between the parties was invalid---Validity---Communications were exchanged between the parties and were sent through automated information system--- Such communication squarely came within the meaning of terms defined in Electronic Transactions Ordinance, 2002, as well as within the meaning of "agreement in writing" defined in Art. II, cl. 2 of the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958. S. 5---New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958, Art. IV---Documents, reliance on---Scope---Court has to only examine documents filed, in order to enforce such award under the doctrine of pro-enforcement bias. S. 7---New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958, Art. V(2)(b)---Recognition and enforcement of foreign arbitral award---Pro-enforcement bias---Object, purpose and scope---New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958, in Art. V advocates 'pro-enforcement bias' policy in dealing with applications of recognition and enforcement of international arbitral awards---General principle has been set forth that each contracting state has to recognize arbitral awards as binding and enforce them---As a result, foreign awards are entitled to a prima facie right to enforcement in the contracting states---Essentially it means pro-enforcement attitude of national courts enforcing foreign award---After ratifying New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958 and Recognition and Enforcement (Arbitration Agreements and Foreign Arbitral Awards) Act, 2011, Courts in Pakistan have enforced the awards through pronouncements of judgments and such enforcement casts a duty upon the Courts to build the confidence of investors by protecting the sanctity of arbitration agreements. Preamble & S. 2(e)---Foreign arbitral award---Court, jurisdiction of---Scope---Preamble of Recognition and Enforcement (Arbitration Agreements and Foreign Arbitral Awards) Act, 2011 provided expeditious mechanism for recognition and enforcement of foreign arbitral agreements and foreign arbitral awards pursuant to New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958---Final Award was made by London Court of International Arbitration against the parties who belonged to consented countries and were bound by New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958, therefore, it came within the meaning of S. 2(e) of Recognition and Enforcement (Arbitration Agreements and Foreign Arbitral Awards) Act, 2011. Preamble---Object, purpose and scope---Preamble means an introductory statement in a Constitution, Statute or Act---It explains the basis and objective of such a document---Though Preamble to a statute is not an operational part of the enactment but it is a gateway, which discusses purpose and intent of Legislature to necessitate the legislation on the subject---Preamble sheds clear light on the goals that Legislator aims to secure through introduction of such law---Preamble of a statute holds a pivotal role for the purposes of interpretation in order to dissect true purpose and intent of law. S. 7---New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958, Art. V(2)(b)---Final award---Unenforceability---Public policy, contrary to---Plea raised by objector to award was that the award was contrary to public policy in Pakistan---Validity---Recognition and enforcement of an arbitral award under S. 7 of Agreements and Foreign Arbitral Awards Act, 2011 and New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958, could be refused if competent authority in Pakistan would find that recognition or enforcement of the award was contrary to "public policy" of Pakistan---To avail benefit of Art. V(2)(b) of New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958, the objector had to satisfy the High Court that the recognition or enforcement of award was contrary to "public policy" of Pakistan---Parties to an arbitration agreement were compelled under Recognition and Enforcement (Arbitration Agreements and Foreign Arbitral Awards) Act, 2011 to take their claims to Tribunals agreed for resolution of disputes by parties and further required the Courts in Pakistan to refer the parties to arbitration---This was the public policy of Pakistan and had be adhered to---There was no violation of Pakistani law or public policy in such circumstances. Ss. 6 & 7---New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958, Art. V(2)(b)---Civil Procedure Code (V of 1908), O. XXI, R. 10---Recognition and enforcement of foreign arbitral award---Pro-enforcement bias---Effect---Applicant filed application seeking recognition and enforcement of foreign arbitral award in Pakistan, issued by London Court of International Arbitration---Objector to the award raised plea of pro-enforcement bias---Validity---Pro-enforcement policy under New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958, refers to a legal approach that favors recognition and enforcement of foreign arbitral awards---Such approach is based on the principle of comity, which requires countries to show respect and deference to legal systems and decisions of other countries and arbitral tribunals---Pro-enforcement policy under New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958, is important because it promotes finality and enforceability of arbitration awards---When parties agree to resolve their disputes through arbitration, they expect that resulting award is final and binding---Pro-enforcement policy helps to ensure that parties can rely on arbitration process to resolve their disputes and that resulting awards are enforced in other countries---In practice, a pro-enforcement policy means that courts should apply a narrow standard of review when considering applications for recognition and enforcement of foreign arbitral awards---Such standard requires courts to limit their review to procedural matters and to refrain from re-examining substance of dispute---Such approach ensures that recognition and enforcement process is swift and efficient, which benefits both parties and promotes international trade and commerce---Pro-enforcement policy under New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958, is essential to promote recognition and enforcement of foreign arbitral awards---Such approach reflects importance of promoting finality and enforceability in arbitration process, which in turn contributes to stability and predictability of international commerce---High Court is bound to implement it as such---Objector failed to defend its foreign arbitration award on the grounds raised under S. 7 of Recognition and Enforcement (Arbitration Agreements and Foreign Arbitral Awards) Act, 2011 read with Art. V(2)(b) of New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958, by its conduct while appearing before London Court of International Arbitration Award, and by not filing proper documents under Recognition and Enforcement (Arbitration Agreements and Foreign Arbitral Awards) Act, 2011 and even by its reply filed before High Court---Objector filed reply (four pages only) without any document/annexure by taking preliminary objections, whereas, applicant filed application under S. 6 of Recognition and Enforcement (Arbitration Agreements and Foreign Arbitral Awards) Act, 2011, read with Art. IV of New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958, and had met with all requirements for enforcement of the "Final Award"---High Court recognized the "Final Award" as binding---High Court passed judgment in the amount represented in the "Final Award", which would be executed as decree of High Court---High Court in exercise of powers under O. XXI, R. 10, C.P.C. converted the application into execution proceedings--- Application was allowed accordingly.

TRADHOL INTERNATIONAL SA SOCIEDAD UNIPERSONAL vs SHAKARGANJ LIMITED S — 2023 PLD 621 LAHORE-HIGH-COURT-LAHORE

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