Finality of Swedish awards: the Nordic saga in the Laczay Estate v. AG A AB

Abstract

On 5 June 1985 the Swedish Supreme Court rendered a decision which put a final end to a peculiar saga of Swedish arbitration: it denied a motion for a new trial in the long disputed matter Estate of Tibor and Irma de Laczay v. AGA AD 1 under Chapter 58 Section 1 of the Swedish Procedural Code.9 In 1972 the Estate had first initiated Swedish court proceedings to annul an arbitral award made in Stockholm on 25 October 1972. The award was made in a dispute between the Estate and the Swedish gas and chemicals company AGA AB over royalties for the marketing and exploitation of certain patents owned by Tibor de Laczay prior to his death. The parties had asked the arbitrators (three prominent Swedish lawyers) to make a partial award on the obligations (if any) of AGA AB to report royalties from certain patents earned after the death of Tibor de Laczay and the right of the Estate to such royalties. The arbitrators made a Partial Award in favour of AGAAB. Under Swedish arbitration law (which controlled the arbitral proceedings) a distinction is made between ‘void’ and ‘challengeable’ awards. Section 20 of the Swedish Arbitration Act enumerates the situations in which an award is void, as distinct from challengeable.2 Section 21 of the Arbitration Act, on the other hand, sets forth a number of grounds on which a party may challenge the award within a period of sixty days from the receipt of the award. If no challenge on one of those grounds is made within this period, the award become final and binding.3 The Estate relied on the following allegations as grounds to annul the Partial Award under both Sections 20 and 21: 1. The arbitrators adjudged an issue which by Swedish law cannot be …