A step backwards – while the Kabab-Ji saga is still ongoing until the appeal to the Court of Cassation in France – the clash between the French and English courts creates uncertainty for the authors of contracts and the users of international arbitration tribunals. As the Supreme Court has pointed out, uncertainty is perceived at the international level with regard to the law of the arbitration agreement, so that national courts will inevitably apply their own national principles. In practice, this result undermines the enforceability of arbitral awards, as the parties now have new arguments for seeking non-enforcement of arbitral awards and the stay of ongoing proceedings. The decision could also lead to forums and purchases of referees. A contract is a type of document used to enforce agreements between two parties. This creates an obligation to take certain measures or not to take them. A party can be a person or a company. Regardless of who the parties are, a contract must contain the following: Not all agreements are necessarily contractual, as the parties should generally be assumed to intend to be legally bound. A so-called gentlemen`s agreement is an agreement that is not legally enforceable and is supposed to be « only honorably binding. »    What makes successful cooperation possible are the rules: at the social level, we have written laws and regulations.
At the company level, the rules take the form of trade agreements. In this module, questions are discussed as to the role that a governance agreement can play in a company and if and when these are needed. Contracts have a choice of law or an applicable legal provision that allows the parties to agree that the laws of a particular state will be followed in the company`s interpretation. This may be the case if the agreement takes place in a completely different state. Most of the principles of the Common Law of Contracts are described in the Reformatement of the Law Second, Contracts, published by the American Law Institute. The Uniform Commercial Code, the original articles of which have been adopted in almost all states, is a piece of legislation that governs important categories of contracts. The main articles dealing with contract law are Article 1 (General provisions) and Article 2 (Sale). Article 9 (Secured Transactions) regulates contracts that assign payment entitlements in collateral interest contracts.
Contracts relating to specific activities or areas of activity may be heavily regulated by state and/or federal laws. See the law on other topics dealing with specific activities or areas of activity. In 1988, the United States acceded to the United Nations Convention on Contracts for the International Sale of Goods, which now regulates contracts within its scope. Outside of the sole proprietorship, even if you are not legally obliged to have an agreement directing the government, it is still advisable to have one. A contract is a legally binding document between at least two parties that defines and regulates the rights and obligations of the parties to an agreement.  A contract is legally enforceable because it meets the requirements and approval of the law. A contract usually involves the exchange of goods, services, money or promises from one of them. « Breach of contract » means that the law must grant the injured party access to remedies such as damages or cancellation.  The plaintiff (and complainant) Kabab-Ji is a Lebanese company that granted a Kuwaiti company, Al Homaizi Foodstuff Company (Al Homaizi), rights under a franchise development agreement dated July 16, 2001 (FDA) to use its restaurant concept for a period of ten years.
According to the FDA, the plaintiff and Al Homaizi subsequently entered into a total of ten franchise agreements (FOAs) relating to individual outlets opened in Kuwait (collectively, the FDA and the FOAs are referred to as « franchise agreements »). Franchise agreements are expressly subject to English law. Following a restructuring of the company in 2005, a new holding company called Kout Food Group (KFG) was established and Al Homaizi became a subsidiary of KFG. However, the terms of the franchise agreements remained unchanged. Kabab-Ji won the ICC arbitration against KFG (as the sole defendant) and attempted to enforce the ICC award in London. The KFG tried to resist the application of the law. Interestingly, the arbitration agreement provided that arbitrators would also apply « generally accepted principles of law to international transactions » (agreed by the parties with reference to the principles of the International Institute for the Unification of Private Law (UNIDROIT)). The Supreme Court held that the reference to the UNIDROIT principles concerned only the legal standards to be applied by the arbitrators in deciding the substantive issues7 and was therefore not relevant to the decision as to the law to be applied to the question of the validity of the arbitration agreement. In any event, the Court held (but did not rule) that a « law » should be limited to the law of a country and held that the applicable law would consist of the entire system of national law chosen by the parties, regardless of unidroit principles. The applicable law of an arbitration clause is important because it is the law used to resolve disputes relating to the validity, scope or interpretation of the arbitration agreement. For example, if there is a dispute as to whether a particular claim falls within the scope of an arbitration clause, that dispute will be resolved by applying the law governed by the arbitration agreement. An error is a misunderstanding by one or more contracting parties and can be used as a ground for the nullity of the agreement.
The common law has identified three types of errors in the contract: common errors, mutual errors and unilateral errors. In interpreting the underlying contract, the court noted that the parties had included « a clause typical of the applicable law » which provided that the agreement was governed by the laws of England and was to be understood as referring to all the clauses contained in the contract, including the arbitration agreement. In addition, the Court held that there was no valid reason to conclude that the parties intended to exclude the arbitration clause from their universal choice of law clause. Although the Supreme Court recognized that the purpose of the New York Convention was to establish a single set of rules concerning the enforcement of arbitral awards and that it should be interpreted accordingly by the courts of States parties, the Court noted that « there is no clear consensus among national courts on where and when a choice of law for the treaty as a whole constitutes sufficient indication. of the Act, 6 and concluded that english courts should form their own opinion on the basis of first principles. If disputes arise over contracts, one party may accuse another party of not complying with the terms of the agreement. .