Award

Archirodon v. General Company for Ports of Iraq

ICC · Investment (ICSID and treaty) · Switzerland · 25 Nov 2019

Why it matters

This case is notable for its detailed treatment of the distinction between financing charges and pre-award interest in international construction arbitration. The Tribunal clarified that a claim for financing charges, dismissed as indirect loss, does not automatically preclude a separate claim for pre-award interest, but here the Claimant failed to properly plead it separately. The award also illustrates the Tribunal's discretion in allocating costs, reducing the Claimant's recovery due to partial success and excessive costs.

Summary

Archirodon, a Cypriot construction company, contracted with the General Company for Ports of Iraq (GCPI) to build port facilities. Disputes arose over delays and additional costs. Archirodon claimed for three delay events, but succeeded only on one related to soil conditions. The Partial Final Award (June 2019) granted Archirodon substantial sums for that claim but dismissed its claim for financing charges as indirect loss under Clause 17.6. The Tribunal deferred the issue of pre-award interest. In the Final Award (November 2019), the Tribunal held that Archirodon had not properly pleaded a separate claim for pre-award interest; it had always linked it to financing charges, which were dismissed. Thus, no pre-award interest was awarded. On costs, the Tribunal applied the principle that costs follow the event but reduced Archirodon's recovery because it succeeded only on one of three claims, its costs were disproportionately high, and it lost on the interest issue. The Tribunal awarded Archirodon USD 6,725,565.74 in costs (out of over USD 12 million claimed) and USD 765,000 for ICC costs. The award was rendered in Geneva, Switzerland, under ICC Rules, with Iraqi law as the governing law.

The detail

Parties: Archirodon v. General Company for Ports of Iraq

Case number: ICC Case No. 21785/ZF/AYZ

Outcome: The Tribunal awarded the Claimant USD 6,725,565.74 in costs and USD 765,000 in ICC costs, and dismissed all other claims and counterclaims.

Quantum: USD 6,725,565.74 (costs) + USD 765,000 (ICC costs)

Applicable law: ICC Rules of Arbitration; Iraqi Civil Procedure Law; Contract General Conditions (including Clause 14.8 and 17.6)

Issues in play: The dispute involved the interpretation of contractual clauses on financing charges and pre-award interest, and the application of Iraqi law on interest and costs.

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