A challenge for nullity of an arbitral award before the Court of Appeal, pursuant to Articles 827 et seq. of the Code of Civil Procedure, is admissible exclusively in respect of institutional arbitrations. In contractual arbitration (arbitrato irrituale), the parties entrust the arbitrator with the resolution of the dispute by means of a contractual instrument, undertaking to regard the decision as an expression of their own will. It follows that a contractual award may be challenged only by an action based on defects of the juridical act, to be brought in compliance with the ordinary rules on jurisdiction and the double degree of adjudication.
The distinction between institutional arbitration and contractual arbitration (arbitrato irrituale) does not rest on the consideration that, in the former, the parties have entrusted the arbitrators with a function substituting that of the court, but is rather to be found in the fact that in institutional arbitration the parties aim to obtain an award capable of being rendered enforceable and of producing the effects referred to in Article 825 of the Code of Civil Procedure in compliance with the rules governing arbitral proceedings, whereas in contractual arbitration (arbitrato irrituale) they intend to entrust the arbitrator with the resolution of disputes solely by means of a contractual instrument, through an amicable settlement or a declaratory agreement referable to their own will.
In order to determine whether an arbitration is institutional or contractual (arbitrato irrituale), the arbitration clause must be construed in accordance with the ordinary canons of interpretation derived from Article 1362 of the Civil Code, and thus by reference to the literal wording, the common intention of the parties and their overall conduct, including conduct subsequent to the conclusion of the contract, without the failure to refer in the clause to the formalities of institutional arbitration pointing unequivocally towards a contractual arbitration (arbitrato irrituale), regard being had to the greater safeguards afforded by the institutional form as to the enforceability of the award, the regime of challenges and the possibilities for the court to grant a stay of execution.
A challenge brought against a contractual arbitral award (lodo irrituale) before the Court of Appeal must be declared, including of the court’s own motion, inadmissible, as the matter involves lack of jurisdiction ratione gradus, in respect of which neither the translatio iudicii nor the principle whereby the time-bar for lodging a challenge is interrupted by the filing of an appeal before an incompetent court applies.
For the purposes of characterising the nature of the arbitration as institutional or contractual (arbitrato irrituale), significant weight attaches to the overall conduct of the parties pursuant to Article 1362, paragraph 2, of the Civil Code, including the legal characterisation which the parties themselves and the competent bodies have attributed to the arbitral proceedings and to the decision, including by means of acts and communications subsequent to the execution of the arbitration clause.