In decision 4A_550/2017, the Swiss Supreme Court confirmed that arbitral tribunals are not obliged to address every argument advanced by a party, in the award. Further, the court confirmed the tribunal's right to determine the evidentiary procedure, including the right to an anticipatory evaluation of evidence.
In a French-language decision, the Swiss Supreme Court has refused to set aside an award dated 18 September 2017, rendered under the former version of the Swiss Rules of International Arbitration by a three-arbitrator tribunal seated in Lugano. In its award, the tribunal ordered the respondent to pay to the claimant $1.5 million on the basis of a contract which, according to the respondent, had been simulated (that is, a contract that, by mutual agreement, did not express the true intent of the parties), and was therefore invalid. The respondent subsequently applied to the Supreme Court to vacate the award, arguing that the arbitrators had violated its right to be heard and procedural public policy.
At the outset, the Supreme Court emphasised that an applicant may not, under the pretext of an alleged violation of its right to be heard, seek a review of the merits of the appealed decision. It further clarified that the right to be heard does not oblige the arbitrators to discuss every argument in detail, and that the question of whether the reasons given in the award are coherent and convincing is beyond the cognition of the court. Applying that standard, the Supreme Court found that the arbitral tribunal had sufficiently addressed the respondent's simulation agreement.
Further, in line with its previous decisions, the Supreme Court confirmed the tribunal's right to an "anticipatory evaluation of evidence", including the right to reject evidence that the tribunal reasonably believes will not lead to a different appraisal of the facts. Although not often used, this principle enables Swiss-seated tribunals to reduce the time and costs of arbitration proceedings.
Finally, the Supreme Court concluded that the award did not violate procedural public policy, emphasising the subsidiary nature of that notion and underlining that a violation of procedural public policy cannot be established by accumulating events that would, each individually, not constitute sufficient grounds for setting the award aside.
Case: Decision 4A_550/2017 (dated 1 October 2018 but only recently published).