LEBANON Law and Practice Contributed by: Mohamed Alem, Mazen Ghosn and Rana Kahwagi, Alem & Associates
Thus, notwithstanding the requirement that arbitra - tion agreements be made in writing (Articles 766 and 763 of the NCPC), the Lebanese Court of Cassation held that a non-signatory company was bound by an arbitration agreement by virtue of the economic unity that existed between that company and the signato - ries to the arbitration agreement. In this decision, the Lebanese Court of Cassation did not require the non- signatory’s participation in the drafting of the agree - ment or the execution of the contract, nor did it require the non-signatory’s knowledge of the existence of the arbitration agreement (Lebanese Court of Cassation, 25 January 2014, Decision 14/2014). Similarly, the President of the Court of First Instance of Beirut upheld a request for the appointment of an arbitrator on behalf of recalcitrant sellers who had not signed the contract for the sale of a property that was the subject of arbitration proceedings. The judge rea - soned that the arbitration agreement signed by some of the sellers could be extended to other sellers if they were involved in the conclusion and execution of the sale contract, which would result in an economic unity between all the sellers (Court of First Instance of Bei - rut, 27 June 2011). In another case, the President of the Court of First Instance of Beirut ruled that the participation of a non-signatory in the negotiation or execution of a contract constituted sufficient evidence to consider that it wishes to be a party to the contract, with the effect of being bound by the arbitration agreement contained therein (Court of First Instance of Beirut, 19 June 2013, Decision 34/272).
In practice, interim or conservatory measures cannot be sought ex parte from arbitral tribunals without giv - ing the opposing party an opportunity to be heard. 6.2 Role of Courts While the case law on the role of state courts in pre - liminary or interim relief appears to be inconsistent, Lebanese courts generally tend to consider that the arbitrator’s power to issue such measures is concur - rent with the jurisdiction of the judge of expedited matters (Judge of expedited matters of Beirut, 7 Sep - tember 1984, Decision 777/84). However, with regard to interim payments, the concur - rent jurisdiction of the judge of expedited matters has often been rejected on the grounds that interim pay - ment decisions require an examination of the merits of the dispute and may even concern the entire claim, which, if transferred to state courts, would be tan - tamount to depriving the arbitration of its substance (Court of Appeal of Beirut, 30 July 2009, Decision 1100/2009; Judge of expedited matters of Beirut, 12 February 2002, Decision 554/2002). In addition, it is established in Lebanese case law that, where arbitral tribunals are yet to be formed, state courts have jurisdiction to order preliminary or interim relief despite the existence of an arbitration agreement, unless the parties have agreed otherwise (Lebanese Court of Cassation, 19 January 1996, Deci - sion 8/2006; Court of Appeal of Beirut, 30 July 2009, Decision 1100/2009). In addition to the above, state courts also act in sup - port of the enforcement of measures ordered by arbi - tral tribunals, particularly as the latter lack coercive powers. 6.3 Security for Costs The Lebanese Arbitration Law does not contain any provisions regarding the power of arbitral tribunals to order security for costs. Nevertheless, arbitral tribu - nals issue such orders in practice. With respect to state courts, Article 866 of the NCPC provides that enforcement judges have the power to order protective measures for the purpose of seizing the debtors’ funds as security for the debt. It can be
6. Preliminary and Interim Relief 6.1 Types of Relief
Following the 2002 amendment of the NCPC (see 2.1 Governing Law ), Article 789 expressly grants the arbitrator the same powers as a court judge to order interim or conservatory measures. These measures include sealing, inventory of assets, sequestration, forced sale of perishable goods, and description of the state of affairs (Article 589 of the NCPC).
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