A recent decision issued by the Court of Appeal of Milan (No. 1946 of 23 June 2021, Italian text available here) deals with a topic of great interest and practical relevance. This topic concerns the relationship between arbitration proceedings and parallel proceedings in a Court of law (which in that particular case were criminal proceedings).
A recent decision rendered by Italian Supreme Court sitting en banc (decision No. 8776 of 30 March 2021, Italian text available here) has clarified – based on hermeneutical criteria, systematic reasons, and constitutional provisions – when the term for commencing setting aside proceedings under Article 828, para. 2, of Italian Code of Civil Procedure starts to run.
In certain cases, Italian law requires the joinder of certain parties to the proceedings. For instance, as a general rule, the action aimed at setting aside a contract requires the joinder of all parties thereof.
The topic of such compulsory joinder in arbitration proceedings is partly governed by statutory law (Articles 816-quater and 816-quinquies of the Italian Code of Civil Procedure); nonetheless, its implementation gives rise to several turmoils (as it was noted by a learned author).
What happens if the party whose joinder is required by law is not joined to the proceedings? A possible answer to that question is provided by the Court of Appeal of Campobasso, in its recent ruling (No. 367 of November 7, 2019, Italian text available here).
The Court of first instance of Salerno recently heard a complex corporate case and its decision (No. 3296 of 21 October 2019, Italian text available here), together with the decision issued by the Court of Appeal of Salerno with reference to the same dispute (No. 1311 of 14 September 2018, Italian text available here), provides the perfect opportunity to carry out a brief analysis of the issues concerning “irrituale” arbitration in corporate matters, that is to say the relationship between the “irrituale” arbitration as governed by Italian Code of Civil Procedure and arbitration in corporate matters under Italian Legislative Decree No. 5 of 17 January 2003 .
As a matter of fact, Italian law provides for two different kinds of arbitration proceedings: on the one hand, “regular” (“rituale”) arbitration, resulting in an enforceable award; on the other hand, “irrituale” arbitration, whose award has the effect of a binding contract.
In addition, “irrituale” arbitration has certain other peculiarities: concerning, for instance, the recourse for its setting aside.
The arbitration clause, in Italian jurisdiction as well as in a number of other jurisdictions, does not constitute an ancillary clause of the underlying contract. On the contrary, it constitutes a separate contract with procedural effects. This principle is usually referred to as separability doctrine.
Under Italian law, this doctrine, based on Article 808 of the Italian Code of Civil Procedure (whereby “The validity of the arbitration clause must be evaluated independently of the underlying contract“), is only derogated in bankruptcy matters (under Article 83-bis of Italian bankruptcy law: I have examined the issue in this post).
This doctrine must also be taken into account if an agreement to agree (which is valid and enforceable under Italian law, and it is quite common in construction and conveyancing) is entered into, containing an arbitration clause, and the subsequent agreement does not contain the arbitration clause. I have already examined this topic a few years ago (in this post). Nonetheless, in the light of its relevance, also from a practical point of view, I consider that it is appropriate to examine it again. The opportunity to do so is offered by a recent decision issued by the Court of Appeal of Brescia (decision No. 1474 of 10 October 2019, Italian text available here).
A recent decision issued by Italian Supreme Court (No. 17159 of 26 June 2019, Italian text available here) gives me the chance to make brief comments on the scope of possible review on the merits of arbitration awards by Italian State Courts seised in proceedings for setting them aside.
The Italian Supreme Court has recently upheld its doctrine on the circulation of the arbitration clause in case of credit assignment (Italian Supreme Court, First Civil Chamber, decision No. 16127 of 14 June 2019, Italian text available here).
I have already examined this topic (in this post); nonetheless, in the light of its relevance, I believe that it is worth re-examining it.
The wording of the arbitration clause is of utmost importance: this is a subject I have already dealt with (for instance in this post). A recent decision of the Court of Appeal of Milan (No. 2528 of 10 June 2019, Italian text available here) confirms this importance also with respect to the possible recourse for setting aside the award.