1. Setting the stage

Under the Swiss International Private Law Act (SPILA), Art. 190(2)(c), a final award (but not a partial award which does not finally settle the dispute) can be challenged before the Swiss Supreme Court as the sole authority (1) if the arbitral tribunal has adjudicated beyond the relief sought (ultra petita), or granted a relief different from the one sought (extra petita). It may further be challenged if certain claims were not adjudicated in the first place (infra petita). Because Swiss law only allows parties to challenge international arbitral awards for a very limited number of reasons, we regularly see decisions of the Swiss Supreme Court dealing with ultra, infra or extra petita issues.

Art. 190(2)(c) SPILA aims at protecting the parties from decisions dealing with issues which were not part of their claims and the taking of evidence, but also to avoid awards lacking completeness regarding the claims which were submitted to the arbitral tribunal. In this context, due regard must be held to the res iudicata effect of the award (see, e.g., the decision of the Swiss Supreme Court [DSC] 4A_294/2019 of 19 November 2019, reason 3). The arbitral tribunal is bound by the subject matter and scope of the claims, in particular if the claimant qualifies or limits its claims in its prayer for relief (see DSC 4A_580/2017 of 4 April 2018 reason 2.1.1; 4A_508/2017 of 29 January 2018 reason 3.1; 4A_50/2017 of 11 July 2017 reason 3.1; 4A_678/2015 of 22 March 2016 reason 3.2.1; each with references).

The cases where ultra, extra or infra petita challenges may be raised, however, are very limited. Because of the principle of jura novit curia, e.g., art. 190(2)(c) SPILA cannot be invoked, e.g., if the award is rendered based on legal reasons different from what the parties argued in their brief to the extent it is covered by the parties’ prayer of relief (see DSC 120 II 172 reason 3a S. 175; DSC 4A_508/2017 of 29 January 2018 reason 3.1; 4A_50/2017 of 11 July 2017 reason 3.1; 4A_678/2015 of 22 March 2016 reason 3.2.1; DSC 130 III 35 reason 5 p. 39), provided that in case of completely unexpected – “surprising” – reasonings, a challenge might be considered. Whether a decision is covered by the prayer for relief is decided with due regard to the interpretation of the latter and the factual and legal arguments raised by the respective party in its support (DSC 4A_284/2018 of 17 October 2018, reason 3.2).

In view of the principle of a maiore minus, it is furthermore clear that a court does not rule ultra ni extra petita by awarding less to a party than it requested (see DSC 4A_404/2017 of July 26, 2018, reason 3.2.1 and 4A_314/2017 of May 28, 2018 considering 3.2.2 in fine). In this respect, the mere finding that the claim is justified is not as far-reaching as the awarding of such an amount (decision 4P.296/2004 of August 5, 2005, para. 4). In the same vein, the finding that there are no actionable claims is not an aliud, but a minus, compared to a finding that there are no claims at all (DSC 4A_459/2009 of 25 March 2010, section 6.1; for an example of a complex action by stages in an IP arbitration, see DSC 4A_580/2017 of 4 April 2018). Moreover, in the case of damages, if several claims are made, the arbitral tribunal is bound only by the maximum amount of damages, but not by its division among several categories of claims (DSC 4A_54/2017 of January 29, 2018). Thus, the arbitral tribunal may award more or less than requested in such claims, provided that the aggregate amount is not higher than the total amount of damages requested by the claimant.

2. Guiding principles as defined by recent case law

The following recent case law illustrates the principles of the Swiss Supreme Court when deciding on ultra, extra or infra petita cases:

Claims for declaratory relief cannot be decided by awarding an amount of money. Whereas the Federal Supreme Court affirmed in a decision the violation of the principle "ne eat iudex ultra petita partium" when the arbitral tribunal not only rejected a prayer for negative declaratory relief, but also ordered the claimant to pay the debt even though the respondent has not asked for such relief (DSC 4P.20/1991 of 28 April 1991 reason 2b), it rejected the appeal under Art. 190(2)(c) SPILA in a case in which the arbitral tribunal did not limit itself to the dismissal of the negative declaratory action but (positively) found that the disputed legal relationship indeed existed (DSC 120 II 172 reason 3a).

The same issue arose in DSC 4A_294/2019 of 13 November 2019 where the Federal Supreme Court held that the arbitral tribunal had violated Art. 190(2)(c) SPILA when instead of deciding on the request for a declaratory judgment determining that the respondents were jointly and severally liable for the damages arising from the breaches of contract that led to the partial withdrawal from the contract (2), it had awarded damages in the amount of USD 1,605,521. 37 (see ibid., reason 4.2).

A request for the conditional admission of a claim constitutes a minus compared to an unconditional admission. In DSC 4A_404/2017 of 26 July 2018, investors under a share purchase agreement sued a Turkish pension fund, which had undertaken vis-à-vis the purchaser to be liable for lawsuits against the target of the purchase, for a declaratory judgment that this target had breached the contract between the two of them. The arbitral tribunal approved the claim on the condition that a final decision would be made in proceedings against it that the sold company had not fulfilled its obligations to the claimants. The pension fund lodged an appeal with the Federal Supreme Court and claimed, inter alia, that the arbitral tribunal had violated the principle ne ultra vel extra petita partium(Art. 190(2)(c) SPILA) because it had awarded something different or more than requested. The Federal Supreme Court dismissed the appeal and held that the arbitral tribunal had not decided extra or ultra petita, but permissibly a maiore ad minus, when it approved the claim under a condition precedent (reason 3.2.1).

The same holds true with alternative claims: In DSC 4A_678/2015 of 22 March 2016 reason 3.2.2, the Swiss Supreme Court found that by awarding the claimant EUR 550’000 out of an employment contract, the arbitral tribunal had also decided on the in eventu claim of EUR 229’725.- and therefore not violated art. 190(2)(c) SPILA, thus confirming the case law established in DSC 4A_218/2015 of 28 October 2015 reason 2.2 (this principle was confirmed in DSC 424/2017 of 23 October 2017 reason 4.2).

Arbitral awards possibly are interpreted by the Swiss Supreme Court as to uphold the latter:In the case DSC 4A_678/2015 of 22 March 2016, the Swiss Supreme Court had to decide on a case in which a Brazilian football player had filed a claim with the FIFA's Dispute Resolution Chamber against his former club for unjustified termination of his contract. The Chamber partially upheld the claim and ordered the club to pay EUR 550,000. On appeal by both parties, the CAS confirmed the amount to be paid. The appellant argued before the Swiss Supreme Court that the Arbitral Tribunal had not fully decided on its claim as it remained unclear whether the awarded EUR 500,000.- were to be considered as a net or a gross amount and therefore, it had the award violates Art. 190(2)(c) SPILA. In its claim before the CAS, the appellant had sought a declaration that the remuneration to be paid under the Employment Contract was net («[...] declare that the remuneration to be paid under the Employment Contract is net [...]»). In its reason 3.2.2, the Swiss Supreme Court held that the contested arbitration decision could not be understood in any other way in good faith than that the stated sum was to be paid to the respondent without deductions, i.e. as a net amount. Consequently, the arbitral tribunal had not violated the principle ne eat iudex ultra petita partium.

Likewise, in its decision 4A_508/2017 of 29 January 2018, the Swiss Supreme Court dismissed a petition to set aside an award on the grounds of ultra petita. In a dispute between a football club and its former coach, the latter had requested salary compensation for the full contract term and a contractual penalty due to a breach of contract. The Court of Arbitration for Sport (CAS) found in favour of the coach and in addition to the salary payment, ordered the club to cover all fees, taxes and contributions in relation to the awarded amounts although the coach had claimed «net» amounts. The Swiss Supreme Court found that the latter were covered by claimant’s implicit reference to the underlying contract (evident from the reasoning in the claimant's submissions) and that the definition of "net" included a claim for the imposition on the club of all fees, taxes and contributions. The ordering of partial payments was not ultra petita, either, because the amount of interest awarded did not exceed the 5% claimed and the total awarded amount was in any event lower than the claimed amount.

Furthermore, in DSC 4A_294/2019 of 13 November 2019, the Swiss Supreme Court found that the arbitral tribunal had not violated any law when it dismissed the IP infringement claim as follows: «The Tribunal DECLARES that: [...] The Respondents are not liable to compensate the Claimant in respect of such infringement of IP Rights and Knowhow related to the Vehicle».

Autonomous conversion of currency by arbitral tribunal does not necessarily amount to an ultra petita award – and «catch-all» clauses (and arguments) help: Furthermore, no infra petitachallenge may be invoked solely because the arbitral tribunal rejects some claims in a «catch all-clause» («all other claims») without explicitly mentioning these claims in its decisions (see DSC 4A_684/2014 of 2 July 2015, reason 4.3 and DSC 4A_173/2016 reason 3.2).

Likewise, in its decision 4A_244/2020 of 16 December 2020, the Swiss Supreme Court rejected an application to set aside an ICC award and found that the arbitral tribunal could, based on a catch-all prayer for relief, order the payment of a sum in an alternative currency even if the conversion had not been expressly requested. The dispute arose out of a contract for the construction of a seaport terminal between contractor (A) and its subcontractor (B). B initiated arbitration proceedings against A. In its prayers for relief, B requested damages of nearly 8 billion of local currency and USD 3,755,269, «alternatively such other sum as the Tribunal deems fit (having regard to the Parties' claims)». The court hold that it was clear from the award that currency conversion had been discussed during the arbitral proceeding and in A's post-hearing brief. While this decision allows the tribunal a broad marge de manoeuvre where a party files a generic catch-all prayer for relief, the outcome might have been different had the applicant raised an objection to that prayer during the arbitration.

In addition to the above cited case, in DSC 4A_516/2020 of 8 April 2021, the Swiss Supreme Court upheld an ICC award that ordered payment of damages in Syrian lira (SYP), whereas the claimants had requested payment in USD. Due to the devaluation of the SYP, the value of the damages was significantly lower than if they had been granted in USD. The claimants challenged the award on the grounds of a violation of the principle of extra petita and of public policy. The Supreme Court dismissed the challenges on both grounds in a landmark decision. While the tribunal's refusal to convert the award into USD meant that the investors had to bear the consequences of the spectacular inflation of the investment in SYP of approximately 79% compared to the USD, the court found that due regard must be given to the entirety of the circumstances, which included, among others, the fact that the investors had chosen to invest in Syria and therefore accepted the risks inherent to the host state, which obviously included currency risks. Furthermore, Syria could not be held responsible for any wrongdoing but bore a strict liability for the exceptional situation of an armed conflict which was even worsened if it were required to pay such a substantial sum as the one claimed by the investors in USD. The court held that in those circumstances, the award of a disproportionately low compensation did not «shockingly contradict» public policy. Regarding the the extra petita challenge, the court conceded that payment in SYP was technically «something other than what had been claimed», but somehow surprisingly found that having not sufficiently demonstrated that they would obtain a more favourable decision if the award were set aside on that basis and the case remanded to the tribunal, the investors lacked a legitimate interest in having the award set aside. It assumed that in such a scenario, the tribunal would dismiss the dollar-based request in its entirety and maintain the award in SYP because the Swiss Supreme Court had not deemed such an award to be incompatible with public policy. And even if the investors were to submit a new claim in a different currency, the court saw no indication that they would receive a more favourable award, particularly because the tribunal might attribute the currency risk to the investors rather than to the state. This award not only confirms the very high threshold for an award to be set aside, particularly on substantive public policy and extra petita grounds, but is also in line with foreign case law, such as the decision AKN v ALC [2015] SGCA 18 of the Singapore Court of Appeals, which affirmed the role of state courts in safeguarding the adherence by arbitrators to the contractual limits of their powers, and confirmed that extensive in eventu («catch-all») arguments may definitely help to defend a challenged award.

3. Concluding remarks

Our analysis leads us to the following closing remarks.

Despite the mostly high quality of international awards, our analysis of Swiss Supreme Court decisions shows a surprisingly rich body of case law over the last years dealing with ultra, infra orextra petita issues. It further re-confirms that the threshold for a successful application before the Swiss Supreme Court is very high and although the principles applying thereon are clear and well established, we may still experience surprises (such as in the SYP-USD currency conversion case). In practice, «catch-all» clauses in terms of prayers for relief as well as in arbitral decisions and also extensive arguments defending its own position have proven as valuable means to successfully defend an award.

Whereas in ultra or extra petita cases, an appeal to the Swiss Supreme Court is the natural remedy, one might wonder why in infra petita cases, parties would want to set aside the whole award merely because certain claims have been left out of it. Experience shows, however, that parties are more prone to turn to courts with a setting aside application than to go back to the tribunal for an additional award although many arbitration rules provide for correction, interpretation and supplementation of the award mechanisms. Under the Swiss Rules, e.g., by giving due notice to the Secretariat and to the other parties, within 30 days after the receipt of the award, a party may re­quest that the arbitral tribunal make an additional award as to claims presented in the arbitration proceedings but omitted from the award (art. 37(c) Swiss Rules). The same holds true with art. 36 of the ICC Rules (see also the ICC Checklist on Correction and Interpretation of Awards) and art. 189a SPILA. The latter provides that unless the parties have agreed otherwise, either party may apply to the arbitral tribunal within 30 days of the award being rendered to correct typographical and accounting errors in the award, explain specific parts of the award or issue a supplementary award in relation to claims made in the arbitration proceedings that were not considered in the award. The arbitral tribunal may do the same within this deadline on its own motion.

Such an application, however, does not affect the deadlines for filing an appeal to the Swiss Supreme Court (art. 194 SPILA). If a party is adversely affected by the outcome of the correction, interpretation or supplementation proceeding, though, a new time limit for an appeal runs in respect of that part of the decision (see art. 189a(2) IPRG and DSC 131 III 164 reason. 1.2.3), but only to the extent that the rectification changes the substance of the original decision to the detriment of an appealing party (for a more extensive discussion of this issue, see DSC 4A_426/2015 of 11 April 2016). As for its unchanged parts, the initial award remains in force.

In this context, it is noteworthy that upon an appeal, the Swiss Supreme Court may neither correct nor supplement the arbitral tribunal's findings of fact, even if they are manifestly incorrect or based on a violation of law unless admissible objections within the meaning of Art. 190(2), in particular lit. c SPILA are raised or if (exceptionally) novae exist (see DSC  4A_150/2017 of 4 October 2017 reason 2.4; DSC 138 III 29 reason 2.2.1 S. 34; DSC >134 III 565 reason 3.1 p. 567; DSC >133 III 139 reason 5, p. 141; each with further references). For this reason, a request for correction of the award to the arbitral tribunal may be a necessary pre-stage for the challenge of the award before the Swiss Supreme Court.

(1) Art. 190 SPILA provides: «The only appeal authority is the Swiss Supreme Court.»

(2) The prayer for relief run as follows: «The Tribunal shall declare Respondents, severally and jointly, liable to compensate Claimant for any and all damages incurred as a result of Respondents' contractual breaches resulting in Claimant's partial avoidance of the 4x4 Armored Tactical Vehicle Contract dated 25 January 2015, as amended».