The Court of Appeal granted recognition of a Latvian award in in respect of the first defendant, finding that there were no grounds for refusal under the New York Convention. Contrary to the defendants’ opinion, the arbitration clause clearly referred to binding arbitration of disputes arising under the parties’ loan agreement. Further, there was no violation of due process, as the applicable arbitration rules allowed the arbitration to be conducted in Latvian (as it had been), since the parties had not chosen another language; also, both defendants had been duly informed of the arbitration. The Court considered that it was not bound by the arbitral tribunal’s findings as to the validity of the arbitration clause, and concluded by an independent review that a valid arbitration agreement existed between the parties. The Court then examined the issue of estoppel. It explained that while it does not follow from Art. V(1)(a) of the New York Convention that a party is estopped from raising the objection of lack of arbitral jurisdiction if it has not raised it in the arbitration, domestic estoppel provisions may apply pursuant to the more-favorable-right provision of Art. VII(1) of the Convention. However, the Court held, there can be no estoppel where the defendant had not participated in the arbitration, as in the case at sssue. Finally, the Court denied the recognition application in respect of the second defendant, on the ground that the arbitration agreement explicitly covered only disputes under the loan agreement, while the second defendant, though he had signed the agreement, had only assumed obligations as a guarantor of the first defendant, as the borrower.