Case of the Day: Getma v. Guinea
Posted on June 17, 2016
The case of the day is In re Certain Controversies Between Getma International and the Republic of Guinea (D.D.C. 2016). Getma had a contract to develop Guinea’s main port in the capital city, Conakry. The agreement called for arbitration of disputes under the CCJA arbitration rules. When a dispute arose, Getma demanded arbitration. The tribunal ultimately awarded Getma significant damages.
During the proceedings, the CCJA had ordered the parties to pay certain arbitration costs in advance. The tribunal asked the CCJA, which was administering the arbitration, to increase the arbitrators’ fees. The CCJA seemed to encourage or at least countenance this request, and the parties indicated they had no objection. But later, the CCJA rejected the tribunal’s effort to increase the fees, citing its prior precedents. Nevertheless, the tribunal’s award included a demand for € 450,000 in arbitrators’ fees, contrary to the CCJA’s decision. “And somehow, the tribunal eventually collected half of the increased arbitrators’ fees from Getma,” the prevailing party.
Guinea sought to annul the award in proceedings before the CCJA, and the CCJA granted its petition on the grounds that the tribunal had violated the CCJA rules by increasing its fees, which only the CCJA had the authority to do. Getma sought confirmation of the now-annulled award in Washington.
The holding was not a surprise: the court refused to confirm the award. It is possible to confirm an annulled award, but only in rare cases where the annulment was a “violation of the most basic notions of morality and justice.” The tribunal had ignored clear directives from the CCJA, which it was (the court found) obligated to obey. The claim that the CCJA misapplied its own precedents was, of course, not enough. The closest argument was the claim that the Guinean minister of justice caused a Guinean judge “to be appointed to the CCJA for the purpose of annulling the arbitral award” had engaged in ex parte communications with that judge during the annulment proceeding. The minister had made some unfortunate public comments in which he claimed that the judge had “counseled him in secret as to how Guinea could present a favorable case before the CCJA,” but he later claimed that what he had said was untrue—the court characterized the minister’s comments as “more likely the product of erroneous self-promotion rather than actual truth.” Moreover, the Guinean judge was just one judge of many who were involved in the CCJA decision.