Arbitration

Arbitration is faster and more private than court, at the price that an award is very hard to disturb afterwards. Getting the case right at the outset matters even more than in litigation.

What this covers

Review of the arbitration clause before any dispute arises
Conduct of proceedings before the arbitral institutions
Applications to the court to enforce an award
Challenges to an award where the statute allows one

Arbitration in Thailand, from the clause to enforcement

What the Arbitration Act B.E. 2545 (2002) requires at each stage, and the deadlines that decide whether the arbitration the parties chose actually takes place.

The clause decides the forum, not the liability

An arbitration clause settles who decides a dispute and by what procedure. It does not settle who is liable in law. That still comes from the underlying relationship: for example the joint and unlimited liability of partners under section 1025 of the Civil and Commercial Code where a venture amounts to a partnership, or the personal liability under section 824 of an agent who contracts for a principal resident and domiciled abroad. See a venture breaks down: who must arbitrate and foreign arbitration does not move the liability.

What counts as an arbitration agreement

Section 11 of the Arbitration Act B.E. 2545 (2002) treats as an arbitration agreement any agreement to settle all or part of a dispute by arbitration, whether the dispute has already arisen or may arise, and whether or not it comes from a contract. It may be a clause in the main contract or a separate agreement. It must be evidenced in writing signed by the parties, but the section also counts a clause appearing in letters, faxes, telegrams, telexes, electronically signed data interchange or other means that record it, and a clause asserted in a claim or defence that the other side does not deny. A written contract that refers to a document containing an arbitration clause, intending it to form part of the contract, is itself treated as an arbitration agreement. See drafting an arbitration clause that will hold.

If the other side sues in court instead

Under section 14, a party sued in court on a dispute covered by an arbitration agreement may apply, no later than the date of filing the defence or within the time allowed for filing it, for the case to be struck out so that the dispute goes to arbitration. The court strikes it out unless it finds the agreement void, unenforceable or incapable of being performed, and while the application is pending either side may begin arbitration and the tribunal may proceed to an award. The window runs with the defence, from being sued. Missing it does not extinguish the claim; it means the dispute stays in court rather than before the tribunal the parties chose. See construction arbitration runs two clocks at once and damaged in transit, and where that is argued.

Setting aside an award: ninety days

An award is not appealed the way a judgment is. Section 40 allows an application to the court to set it aside within ninety days of receiving a copy or, where the tribunal was asked to correct or interpret the award or make an additional award, from when it did so. The applicant must prove one of five grounds: a party's incapacity; an arbitration agreement without binding force under the law the parties chose or, failing a choice, Thai law; no proper notice of the appointment of the tribunal or of the proceedings, or inability to present the case for another reason; an award outside or beyond the scope of the submission; or a tribunal or procedure not as agreed. The court may also act where the dispute could not be settled by arbitration under the law, or where recognising or enforcing the award would be contrary to public order or good morals. How the tribunal weighed the evidence is not a ground. See setting aside an award: ninety days.

Enforcing an award: three years, and a certified translation

An award does not enforce itself. Section 42 requires the party seeking enforcement to apply to the competent court within three years from the day the award became enforceable, and the court is to inquire and give judgment without delay. The applicant must produce the original award or a certified copy, the original arbitration agreement or a certified copy, and a Thai translation of both, made by a translator sworn or affirmed before the court or a person empowered to administer an oath, or certified by an officer empowered to certify translations or by a Thai diplomatic or consular representative in the country where the award or agreement was made. The translation is usually the slowest part. See enforcing an award: three years, three documents.

Awards made outside Thailand

Under section 41 an award binds the parties wherever it was made. An award made abroad, however, is enforced by a Thai court only if it falls under a treaty, convention or international agreement to which Thailand is a party, and only to the extent that Thailand has accepted it. Thailand is a party to the 1958 New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, as the Supreme Court has recognised, for example in judgment 1772/2542.

When enforcement can be refused

Section 43 allows the court to refuse enforcement, wherever the award was made, only if the party resisting it proves one of six matters: a party's incapacity; an arbitration agreement without binding force; no proper notice of the appointment of the tribunal or of the proceedings, or inability to present the case; an award beyond the scope of the agreement; a tribunal or procedure not as agreed; or an award not yet binding, or set aside or suspended. Where proceedings to set aside or suspend the award are pending, the court may adjourn and, at the applicant's request, order the resisting party to give suitable security. Under section 44 the court may also refuse where the dispute could not be settled by arbitration under the law, or enforcement would be contrary to public order or good morals.

After the court's judgment

Once the court has given judgment enforcing the award, recovery against the other party's assets follows the execution procedure. See enforcing a Thai court judgment.

The matters this covers

Each has its own page setting out what the statute requires and what to prepare.

The legislation

Arbitration Act B.E. 2545 (2002)
Civil Procedure Code

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