Data

Date:
26-09-2022
Country:
Arbitral Award
Number:
No. 204865
Court:
London Court of International Arbitration
Parties:
DUNOR ENERGÍA S.A.P.I. DE C.V. v. COMISIÓN FEDERAL DE ELECTRICIDAD

Keywords

LONG-TERM CONTRACTS - STATE CONTRACTS - CONSTRUCTION CONTRACT – BETWEEN A SPANISH CONSORTIUM AND THE MEXICAN FEDERAL ELECTRICITY COMMISSION – GOVERNED BY MEXICAN LAW

REFERENCE TO ART. 1.8 UNIDROIT PRINCIPLES IN ORDER TO CONFIRM MEXICAN SCHOLARSHIP AND JURISPRUDENCE (NON VENIRE CONTRA FACTUM PROPRIUM PRINCIPLE)

Abstract

The Mexican Federal Electricity Commission (CFE) (Respondent) concluded a contruction contract with a Spanish consortium (Claimant) in order to build the Empalme II, a combined cycle plant located in the state of Sonora, which was supposed to supply this region of Mexico. The contract was governed by Mexican law.

Claimant commenced arbitral proceedings against Respondent for breach of contract.

The Arbitral Tribunal condemned the Respondent to pay 20.76 million dollars for breaching the construction contract, plus interests.

Among the numerous objections raised by Claimant against Defendant, there was that related to the application of Degradation Curves to the Results of the Performance Tests of the Power Plant. According to Claimant, the Degradation Curves should be used for the Performance Tests, as these curves represent correction factors that reflect the deterioration or wear suffered by the turbines due to the additional operating time. On the contrary, Respondent considered that the Degradation Curves cannot be applied due to what is expressly prohibited and provided by the Contract.

In particular, Claimant argued that the failure to take into account the additional operating hours constituted an action against one’s own acts. It considered that Respondent simply cannot both (i) recognize the existence of an Impact Period resulting from causes not attributable to Claimant, and (ii) seek to penalize the latter for the effects that this Impact Period has on the results of Tests, which are a direct consequence of equipment wear.

In supporting this, Claimant referred to the own acts doctrine (“one should not be able to go against one’s own acts”), being known as “[o]ne of the general principles of Law” also recognized in the UNIDROIT Principles on International Commercial Contracts 2016 (art. 1.8). It pointed out that the non venire contra factum proprium principle has also been accepted by Mexican jurisprudence.

The Arbitral Tribunal confirmed Claimant's thesis on the breach of contractual good faith by Respondent.

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