UNITED STATES 25 January 2023 Olsen Securities

United States District Court, Eastern District of Louisiana, 25 January 2023, CIVIL ACTION NO. 22-3120 SECTION: "G"(1)

(Olsen Securities Corp., et al. ... Read more

United States District Court, Eastern District of Louisiana, 25 January 2023, CIVIL ACTION NO. 22-3120 SECTION: "G"(1)

(Olsen Securities Corp., et al. v. Certain Underwriters at Lloyd’s London, et al.)

 

25 - 01 - 2023

UNITED STATES 25 January 2023 Olsen Securities

Jurisdiction United States
Summary

The District Court ordered arbitration of an insurance dispute for damages caused by Hurricane Ida. Having noted at the outset the Supreme Court’s recognition of the emphatic federal policy in favor of arbitral dispute resolution, particularly in the field of international commerce, the Court held that all the four jurisdictional requirements for compelling arbitration under the New York Convention were met: there was a written agreement to arbitrate in the insurance policy; the agreement provided for arbitration in a Convention signatory, the United States; the agreement arose out of a commercial legal relationship; and at least one party to the agreement was not a US citizen. The Court rejected Olsen’s argument that contradicting language in the insurance policy invalidated the arbitration clause. While the insurance policy’s endorsements did contain language referring to “service of suit”, and service-of-suit clauses provide for the jurisdiction of a US court of competent jurisdiction, the Court reasoned that under Louisiana law, insurance policies must be construed as a whole, and that, according to the Fifth Circuit, endorsements affixed to an insurance policy are to be construed in connection with the policy and the entire agreement harmonized, if possible. The Court concluded that the language in the endorsements did not supersede the language of the arbitration clause, because the insurance policy, as one harmonious document, could be read such that the service of suit provisions applied to suits for enforcement of a final arbitral award.

Related topics
214-216 Field of application
220

The court discusses how to interpret the Convention’s requirement that the agreement is not null and void etc., as well as specific cases of invalidity: e.g., lack of consent (misrepresentation, duress, or fraud), vague wording of the arbitral clause; other terms of the contract contradict the intention to arbitrate, etc.

"Null and void", etc.
UNITED STATES 25 January 2023 Olsen Securities