Legal Updates

One who participated in an arbitration may not later contest the power of the arbitrator

March 21, 2018

A dispute between partners in a diamonds trading business was settled by an arbitrator in accordance with an arbitration agreement. One of the partners sought to void the arbitral award, inter alia, contending that the arbitration was conducted in lack of authority.

The Supreme Court held that the one who does not recognize an arbitrator's authority can refrain from participating in arbitration or participate without any reservations. A party to an arbitration cannot eat the cave and have it too by holding a kind of "insurance policy" so that if he wins he would not contest the authority. Here, a party contested the authority of the arbitrator but sent an e-mail in which he offered to participate in the arbitration by means of a video conference due to his inability to be present in Israel in person, but also noted that he retains all rights and contest the arbitration – thus the party is held to have agreed to the authority.