The railways ordered 20 locomotives from Škoda for about CZK 2.5 billion. The carrier was to take over the locomotives in 2009, but did not receive the first machines until 2013. Škoda defended the late delivery by changing regulations during the development of the locomotives and turned to the arbitral tribunal for additional payment of the purchase price, which the railways did not pay. The railways, on the other hand, demanded billions in fines for late delivery. The arbitration eventually awarded Škoda Transportation a surcharge of 1.2 billion for the locomotives. The railways did not recognize the arbitration decision and demanded its annulment in court. Czech Railways was represented in the dispute from the beginning by the law firm Weil, Gotshal & Manges, later renamed Skills.
The carrier argued in court, for example, the bias of one of the arbitrators. However, two years ago, the Prague Municipal Court recognized the arbitration award as valid, stating that it was not possible to review the arbitration award itself. The court therefore dealt mainly with the procedural aspect of the conduct of the arbitration, which, according to him, was in order. The railways appealed against the court’s decision and continued to demand the annulment of the arbitration verdict.
In today’s trial at the High Court, Czech Railways argued, for example, with the insufficient settlement of its evidence by the court of first instance. In addition, according to them, the court ruled only on the basis of a copy of the arbitration award, which, moreover, had non-public parts to which the participants did not have access.
However, the Court of Appeal did not today acknowledge the carrier’s allegations as well-founded and upheld the original decision. He referred, among other things, to the arbitration clause, which was part of the contract between the two companies and which did not allow the dispute to be resolved by the court of fact.
ČTK
(we are preparing details)
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