Firstly, it is very important to keep in mind
that Brazilian law compare the arbitral award to a judicial decision. The Law
of 1996 states that awards are enforceable by the same procedure of a judicial ruling.
Therefore, most of the arbitralists of the country considers that arbitration
is jurisdictional in nature and it is submitted to similar legal standards of state
courts’ judgment.
Following this reasoning, we find in Brazilian
Constitution that all decisions from State Judiciary or Administrative Courts
should provide the reasons for their conclusions (Federal Constitution of
Brazil, Art. 93, IX). Thus, we have a superior rule of law, which is on top of
the legal system stablishing a formal requirement for jurisdictional and
administrative decisions. The Civil Procedure Code states that decisions must
provide “reasons adopted by the Judge to decide about matters of fact and of
law” (art. 458, II). Additionally, it is noteworthy that, in less than a year,
Brazil will have a new Civil Procedure Code.
The new statute states that a decision is not deemed reasoned if it only copies
articles of Statutory Law, general concepts, principles of law and precedents,
if there is not an explanation of how the law applies to the case. However,
arbitral procedures does not follow directly the rules of this code, being
regulated by the special law of arbitration (statute number 9.307/96). The Law
of Arbitration mirrors the rule of the current civil procedure code of article
458, II, requiring that arbitrators expressly provide the reasoning to decide
the merits of law and of facts (art. 26, II).
Undoubtedly, one of the formal requirements of
arbitral awards in Brazil is the reasoning. Nonetheless, the debate arises when
we turn to homologation of foreign awards, because we need to decide what laws
apply and what are the international principles to be followed by the Brazilian
Judiciary in the recognition process.
Many states do not require a formal reasoning
in the arbitral award to be valid and enforceable under their laws. One
relevant example is the United States Case Law, where we can easily find
jurisprudence stating that “Arbitrators have no obligation to the court to give
their reasons for an award.” (UNITED STEELWORKERS OF AMERICA V. ENTERPRISE
WHEEL CAR CORP. CERTIORARI TO THE UNITED
STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT.
NO. 538. ARGUED APRIL 28, 1960. DECIDED JUNE 20, 1960.[1]); “It
is well settled that arbitrators are not required to disclose or explain the
reasons underlying the award.” [United States District Court, S.D. New
York.·757 F. Supp. 283 (S.D.N.Y. 991)·Decided February 15, 1991HOUGH v. LYNCH,
PIERCE, FENNER SMITH -[2]]; “Arbitrators
are not required to give reasoned analysis for their decisions, or any
particular aspect of them, and thus "`The absence of express reasoning by
the arbitrators [does not] support the conclusion that they disregarded the
law.'" [UNHILL FRANCHISEES TRUST, PETITIONER, V. DUNHILL STAFFING SYSTEMS,
INC., RESPONDENT. NO. 07 CIV. 6940.
UNITED STATES DISTRICT COURT, S.D. NEW YORK. OCTOBER 29, 2007[3]].
Brazil is signatory of the NY Convention;
therefore, it applies to Brazilian procedures of recognition of foreign awards,
so the annulment or non-recognition of them for lack of reasoning must be
interpreted under the articles of the convention. The Superior Court of Justice
is the Brazilian court in charge of deciding about recognition of foreign
decisions. It has denied recognition to judicial decisions without the minimum reasoning
requirement based on the public policy justification (Superior Court of Justice
– STJ, SEC 880 / IT SENTENÇA ESTRANGEIRA CONTESTADA 2005/0034902-6). The
natural question is will the court follow the same pattern and deny recognition
based on the article V, 2, “b” of the NY Convention in cases of arbitration?
The reason to deny recognition is also referred in Brazilian Arbitration Law in
article 39, II, which mentions that national public policy is a possible ground
of non-recognition. The first answer of the Competent Court is in the sense of
respecting the formal requirements from the procedural law applied of the place
of the arbitration [SEC 5692 (2012/0246980-3 - 01/09/2014)]. Similarly, we can
find that Brazilian authors and international arbitralists understand that
there is a broad concept of public policy in this context, which is the international
public policy (in Brazil, see André Abbud, 2008: p. 213 ; outside Brazil, see
Gary Born, 2012: p. 326). French Law, for instance, expressly denies recognition
“if the recognition or enforcement is contrary to public international order”
(French Code of Civil Procedure, Article 1502, 5º)[4].
In
conclusion, although Brazilian Arbitration Law determines that an award must be
accordingly to national Public Policy, we may expect the recognition of an “international
public policy” in Brazilian Law. The first precedent about the formal
requirements of a foreign award and the jurists’ position on the matter are in
favor of treating arbitration in a different way from foreign judicial
decisions, because in the first one, parties agrees to the patterns followed by
international arbitration. Therefore, they freely submit to the formal
requirements stablished by the rules they chose to regulate their method of
conflict resolution.
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