Awards Based on Grounds not Submitted by the Parties

Awards made in Switzerland may be challenged (directly before the Supreme Court) if the arbitrators have violated the parties’ "right to be heard in adversary proceedings" (guaranteed by Articles 182(3) and 190(2)(d) of the Swiss Private International Law Act).

The right to be heard applies in connection with factual as well as legal issues. As to legal issues, however, the right to be heard does not prevent the arbitrators from deciding the case on arguments or rules that have not been submitted. Nor is there a right of the parties to be given an opportunity to supplement their legal submissions before the arbitrators decide on such a different basis. Several cases have so held.

The case reported has now created an exception to the above rule. This case holds that if the arbitrators wish to decide the dispute on a legal basis that was unforeseen and unforeseeable for the parties, the arbitrators must give an opportunity to the parties to supplement their submissions on such