Mandal, Companhia Brasileira de Distribuicao (CBD)’s wholly owned subsidiary, entered into a sales and purchase agreement (SPA) of Globex shares with Globex’s major shareholders (designated as Morzan). Morzan found that CBD did not abide by the payment terms. Consequently, Morzan initiated arbitral proceedings against CBD and its major shareholder, the brazilian company Wilkes Participações SA (Wilkes). The arbitral tribunal found in its favour and ordered CBD and Wilkes to pay damages.
CBD and Wilkes sought the annulment of the award, arguing that the decision was contrary to international public policy and that the tribunal had failed in its task to provide a motivated award.
The Court of Appeal dismissed the claim. The Court stated that the partial award and the final award rendered two years later by the arbitral tribunal did not contradict each other. Therefore, both the res juridicata within ongoing proceedings and international public policy were observed.
The Court emphasized that as the judge of annulment proceedings, it can only control the existence of motivations in the award but cannot control their relevance.
The Court added that the tribunal can, without failing in its mission, endorse the evaluation made by one party’s expert if it has been questioned and addressed by the other party.