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Case 403: Art. 16 (1) MAL
Germany: Highest Regional Court of Bavaria; 4Z SchH 6/99
15 December 1999
Original in German
Published in: DIS Online Database on Arbitration Law
The decision, arising out of an action to have the composition of the tribunal corrected by a court, concerns the issue of the court's competence to review the jurisdiction of the arbitral tribunal.
According to section 1034 (2) German Code of Civil Procedure, if an arbitration agreement grants preponderant rights to one party with regard to the composition of the arbitral tribunal, placing the other party at a disadvantage, that other party may request a court to appoint the arbitrators in deviation from the agreed nomination procedure. In the case at issue, claimant, the Bavarian Football Association, had brought a claim for damages before its own court of arbitration against two of its senior representatives for breach of their fiduciary duties, resulting in significant financial damages to claimant. Respondents had challenged the composition of the arbitral tribunal because, according to the arbitration rules of the Bavarian Football Association, the tribunal was appointed by a committee of that association. However, they had not challenged the jurisdiction of the arbitral tribunal pursuant to section 1040 (2) German Code of Civil Procedure (adapted from article 16 (2) MAL).
The Court dismissed respondent's motion for the appointment of the arbitral tribunal by the Court. It held that the judicial challenge of the composition of an arbitral tribunal is only admissible if the dispute before the arbitral tribunal falls within the scope of the arbitration clause. The Court recognized the arbitral tribunal's authority to rule on its own jurisdiction. However, it refused judicial assistance to arbitral proceedings that obviously did not fall within the terms of the submission to arbitration. The Court found that the applicable provision of the association's arbitration rules did not cover civil liabilities between the association and its representatives but only disputes deriving from membership status. Therefore, since the tribunal's jurisdiction did not cover the subject-matter, it was not necessary for the Court to order a new composition of the arbitral tribunal.
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