Suspension of an Arbitral Award at the Court of Appeal: Our Strategy for Property Protection
The issuance of an adverse decision by an Arbitral Tribunal can pose an immediate risk to the viability of a business. Our firm successfully handled such a critical case brought before an Arbitral Tribunal. Through targeted legal actions, we succeeded in suspending the arbitral award pending the final judgment of the Court of Appeal on the action for annulment.
In this specific case, the first applicant was a general partnership (O.E.). The immediate initiation of enforcement of the arbitral award indiscriminately threatened both the corporate assets and the personal property of the remaining applicants, who are personally and jointly liable for the business's corporate debts.
If the award were enforced immediately, the applicants would be required to pay a highly significant monetary amount (plus interest), which would render covering the company's monthly operating expenses impossible. Concurrently, it would completely deplete the annual income of the natural persons, placing their very livelihood at immediate risk. The Court of Appeal held that immediate enforcement of the award would likely cause irreparable financial harm to all applicants.
Are you facing a similar problem? Our law firm has handled numerous cases of this nature, protecting our clients' interests. As merely reading this article does not provide comprehensive information, contact our firm's specialized lawyers today to analyze the facts of your own case.
Our legal team acted swiftly on two fronts:
The competent court, following the procedure of Articles 686 et seq. of the CCivP, granted the suspension, finding that the grounds for annulment of the arbitral award we raised were likely to succeed.
The decision of the Athens Court of Appeal marks a decisive victory. It was recognized that enforcing the award prior to the final judgment on the action for annulment would create irreversible situations, which would be extremely difficult or impossible to overturn in the future. Conversely, no substantial harm is caused to the respondent's interests by the suspension of enforcement, as their claim is fully secured by our clients' creditworthiness, and the delay in collection is compensated by statutory interest.
No. Pursuant to Article 899 § 3 of the Greek Code of Civil Procedure (CCivP), the filing of the action does not automatically suspend enforcement. To protect your assets, a separate petition for suspension must be filed with the competent court, which must demonstrate the risk of irreparable harm.
The court examines whether immediate enforcement of the award (e.g., payment of a vast sum) would render the operation of your business impossible (inability to pay payroll, rent, contributions) or whether it would exhaust the personal income of the partners, putting their livelihood at risk. If these elements are deemed likely, the suspension is granted.
According to Article 898 of the CCivP, exclusive jurisdiction lies with the Court of Appeal in whose district the disputed arbitral award was issued. This court will adjudicate both the action for annulment and the petition for suspension.
Yes. In the case of General Partnerships, the initiation of enforcement impacts not only corporate assets but also the personal property of the general partners, as they are personally, jointly, and severally liable for corporate debts. Therefore, immediate legal intervention with a petition for suspension is absolutely critical.
