Mistranslation or Fatal Flaw? Arbitration Agreement's Validity Challenged Over Non-Existent Institution

Medipack S.A. is challenging the jurisdiction of the arbitral tribunal in a dispute with Equafilm Co. The crux of Medipack's argument lies in Section 13 of their December 15, 2000, contract, which outlines the arbitration agreement. This section stipulates that arbitration should occur under the rules of the 'German Arbitration Association,' an entity that does not exist.

Medipack contends that this erroneous reference invalidates the arbitration clause, rendering the entire arbitration agreement unenforceable. They argue that without a valid arbitration clause, the tribunal lacks the authority to adjudicate the dispute.

Equafilm Co., however, argues that the reference to the 'German Arbitration Association' was a simple mistranslation. They contend that the intended institution was the 'Deutsche Institution fr Schiedsgerichtsbarkeit e.V.,' a recognized German arbitration institution.

This case raises crucial questions about the impact of an incorrect reference to an arbitration institution on the validity and enforceability of an arbitration agreement. It highlights the importance of precise language and accurate translations in legal documents, particularly those governing dispute resolution.