The first case concerned a claim for compensation under a Share Purchase Agreement (SPA), where the purchaser lodged a claim for compensation based on erroneously accrued (too high) revenue in the accounts of the target company. The parties had agreed to arbitration in the SPA.

An arbitral award was rendered in favour of the purchaser. The seller of the company challenged the award, arguing that the arbitral tribunal had exceeded its mandate by basing its award on the price adjustment clause included in the SPA, when the purchaser had presented its claim as a claim for damages.

An arbitral tribunal shall not base its award on grounds or facts not invoked by the parties. If it does so, the award can be fully or partially annulled if the facts or grounds wrongfully relied on by the tribunal actually affected the outcome.

In this case, the Svea Court of Appeal concluded that the arbitral tribunal had, when referring to the price adjustment clause in the SPA, referred to facts raised by the parties in their submissions. Therefore, the award should not be annulled.

Case: Tiscali International BV of the Netherlands v Spray Networks of Sweden (now renamed Yarps Network AB) (Svea Court of Appeal) (case no. T 2418-07) (24 January 2011 award) and Final costs award (21 September 2011).

The second case also involved an SPA. The issue in this case concerned the earn-out provisions in the SPA and whether or not the seller had argued in the arbitration proceedings that it had no duty to notify the purchaser during a specific notice period. The arbitral tribunal made a reference to this issue in the award and concluded that no specific notice period had to be adhered to by the seller in that regard.

The Svea Court of Appeal held that an arbitral tribunal must not base its award on grounds or facts not invoked by the parties and that, if it does so, the award can be fully or partially annulled if the facts or grounds are actually relied on by the arbitral tribunal when rendering the award (that is, they affect the outcome). The court also added that greater leeway should be granted to arbitral tribunals in international arbitrations with their seat in Sweden. However, as a minimum, a ground or fact must always at least have been mentioned during the arbitral proceedings for the tribunal to be able to rely on it.

After reviewing the submissions and the award in this case, the court concluded that the seller had invoked the argument that no notice period needed to be adhered to and, therefore, rejected the challenge.

Case: Perstorp AB (of Sweden) v Silver Lining Finance SA (of Luxembourg) (Svea Court of Appeal) (case no. T 4050-10) (unofficial translation).