International: Arbitration governed by seat of arbitration

Sulamerica CIA Nacional De Seguros SA v Enesa Engenharia SA [2012] EWCA Civ 638

The claimant was the insurer of hydro electric facilities in Brazil. Both parties were Brazilian, the risk was situated in Brazil and there was a dispute resolution clause which provided that the policy was governed by the law of Brazil and that all disputes were to be subject to the exclusive jurisdiction of the Brazilian courts. The policy also provided that the parties would seek to have any disputes resolved amicably by mediation and that if mediation failed then any disputes as to the amount payable under the policy were to be resolved by arbitration with its seat in England. A dispute arose as to alleged change of risk under the policy. The parties were unable to agree on a mediation procedure, and the defendant commenced judicial proceedings in Brazil.