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July 31, 2009

Newly-Discovered Evidence in Post-Award Proceedings

Dear Readers:
A recent commentary by Dr. Georg von Segesser of Schnellenburg Wittmer, Zurich, posted on the Kluwer Arbitration Blog ( discusses a recent Swiss Federal Supreme Court case in which the Court denied a motion to vacate an award based on new evidence presented to the Court on an issue of fact determined by the Arbitral Tribunal. I posted on the Kluwer Blog a comment concerning how the same issue might be addressed by an American federal court. That comment is republished here.

Georg, I believe a U. S. Court would have reached the same result given this procedural history, but that U. S. courts would be generally more flexible that the Swiss Federal Supreme Court in admitting “newly-discovered” evidence at the enforcement/vacatur stage.
Article V(2)(b) of the New York Convention does not on its face address what evidence may be offered in support of an objection to recognition and enforcement based on public policy. Neither does Section 10(a)(1) of the U.S. Arbitration Act, which would apply if a U. S. court had jurisdiction to set aside the award. That section provides that an award may be vacated if the award was “procured by corruption, fraud, or undue means.”
If this were a U. S. award, and the application were made to set it aside, our courts require “clear and convincing evidence” of the procurement by fraud, etc, and they further require proof that the improper conduct would not have been discoverable by the exercise of reasonable diligence (by the aggrieved party) during the arbitration.
Based on the Swiss Federal Court’s ruling in regard to the interim award, I gather the facts here would likely cause a U. S. court to rule that there was a lack of reasonable diligence, and so the award would stand.
Were the issue presented in a U. S. proceeding to enforce a foreign award, one may wonder whether bribery in a private commercial context, as opposed for example to a government procurement contract, would bring about application of the public policy ground for denying enforcement under Article V(2) (b). One would also expect the “due diligence” principle to be applied with regard to newly-discovered evidence, by analogy to the requirements under Section 10(a)(1).