"42.1 Any dispute between the BUYER and the CONTRACTOR arising out of or in connection with this CONTRACT which cannot be settled by mutual agreement shall be settled finally under the Arbitration Rules of the International Chamber of Commerce by an Arbitral Tribunal appointed in accordance with the said Arbitration Rules.
42.2 The place of arbitration will be in:
42.1.1 New York, USA, where the applicable law of the CONTRACT is Canadian or American;
42.1.2 Zurich, Switzerland where the applicable law of the CONTRACT is that of a country of the European union;and
42.1.3 Johannesburg, South Africa where the applicable law of the CONTRACT is South Africa.
42.3 The arbitration shall be conducted in English language.
42.4 The arbitration award shall be final and binding upon the PARTIES and may be enforced in any court having jurisdiction.
42.5 Nothing is this clause 42 shall prevent a PARTY from seeking from any court of competent jurisdiction an interim order restraining the other PARTY from doing any act or compelling the other PARTY to do any act.
42.6 The performance of the CONTRACT shall not be suspended cease or be delayed by the reference of a dispute to arbitration."
Section 10 of the Contract states as follows:
"(...) this contract and the rights granted or arising hereunder, shall be governed by, and interpreted in accordance with the laws applicable in the province of Quebec".
Further, Section 41 of Appendix 17 to the Contract states that:
"The GENERAL CONDITIONS and each CONTRACT shall exclusively be governed by and construed in accordance with the LA WS of the place where the concerned SITE is located provided that the country where the SITE is located in Canada, the European Union (except the countries becoming members of the European Union after 2000), South Africa, or the United States of America. For the countries becoming members of the European Union after 2000), the applicable law shall be the Swiss law unless otherwise specified in the concerned CONTRACT. Should the concerned SITE not be located in any of the above-mentioned countries, Swiss law shall apply. In any case, the UN Convention on Contracts for the International Sale of Goods of 1980 shall be expressly not applicable."
The applicable rules to these proceedings are the ICC Rules of Arbitration in force as from 1 January 2012 ("the Rules").
"1. The Parties shall submit simultaneously their Post-Hearing Briefs limited to 75 pages by 1 October 2018 and their Replies limited to 10 pages by 22 October 2018.
2. The Parties and the Arbitral Tribunal shall have a conference call or in person meeting for further questions on 27 November 2018.
3. The Parties shall submit their Costs submissions by 14 December 2018."
|Polysius Corporation||38 AG Mill||US$17 808 000|
|Outotec (USA) Inc.||38 AG Mill||US$20 653 700|
|CITIC Heavy Industries Co. Ltd.||38 AG Mill||US$20 778 600|
|FLSmidth Inc.||36 SAG Mill||US$16 265 000|
|Metso Minerals Industries Inc.||36 AG Mill||US$22 413 687|
|Mill feed rate design, design (t/h new feed, dry basis)||3002|
|Operating Work Index, measured at motors lead, metric (kWh/t)||Average 3.3 3.8 (75th percentile).|
• An order requiring the Respondent Metso Minerals Canada Inc. to pay to Claimants the following sums resulting from the defects affecting the AG Mill:
(a) $150,427,294 CAD in respect of the production loss from 22 September 2013 to 30 June 201842; and
(b) $25,369,573 CAD in respect of the mitigation costs incurred by ArcelorMittal, namely related to the conversion to a SAG mill;
• An order requiring Respondent Metso Minerals Canada Inc. to pay the Claimants’ legal fees and costs of the arbitration;
• An order requiring Respondent Metso Minerals Canada Inc to pay the Claimants interest on the above amounts at such rates and for such periods as the Tribunal considers appropriate;
• An order granting such further or other relief as the Tribunal may deem appropriate in the circumstances.43"
"Vendor’s scope shall include all labor, materials, equipment and services to:
- Design, supply, fabricate, assemble, paint, inspect, test, deliver, site supervision for assembly and installation, and commissioning support for the equipment listed in Section 1.2.1 (...)".
|New Mill (1) Line 7|
|Mill size (D x L, ft)||36’x 21.5’F/F|
|Mill size (L, ft.) EGL||19.75 ft.|
|Mill feed rate design, design (t/h new feed, dry basis)||3002|
|Ore specificity gravity||3.4|
|Operating Work Index, measured at motors lead, metric (kWh/t)||3.3 (average) 3.8 (75th percentile)|
|Mill loading (max design)||30%|
|Mill critical speed %||75-78|
|Mill feed size Fl00 (mm)||200|
|Mill feed size F80 (mm)||180|
"- During periods where ‘hard ore’ is processed, (i.e. ore with an operating work index as defined above in the order of 3.8 kWh/t), production capacity should be limited to the nominal production rate of 3002 t/h.
- At average ore hardness (i.e ore with an operating work index of 3.3 kWh/t, representing the 50% percentile of the ore index distribution), production rate would be at the design capacity of 3452 t/h. This thus implies that when ore is softer than average, production remains capped at design capacity.
- In the 25°% of the cases where ore is harder than 3.8 kWh/t, production will have to be reduced to levels below nominal production rate of 3002 t/h".
- "When processing hard ore (3.8 Kwh/t), the nominal production rate of 3002 t/h will need to be maintained. When ore hardness increases above this level, production will be curtailed. This is markedly different than the original design parameters which required that design capacity of 3452 t/h be achievable for hard ore;
- The design capacity of 3452 t/h need only be achieved when favorable ore hardness conditions prevail. Therefore design capacity will be attained when ore hardness is in the order of 3.0 Kwh/t."
However, the majority of the Arbitral Tribunal additionally finds that the AG Mill was in any event prevented from processing 3002 tph at an ore hardness of 3.8 kWh/t more frequently than it did because it was not operating under the agreed contractual conditions and, in any case, was not tested under such conditions of operation. Indeed, pursuant to the Datasheet, the ore feed would not exceed 200 mm (the Fl00) and that 20% of the feed that would be between 180 mm and 200 mm (the F80) intended to act as grinding media. The Datasheet also provided for specific gravity (t/m) and hardness under certain parameters (mill rotational speed and product size (P80)).
- USD 2,318,320.96 for Legal Costs148;
- USD 1,013,859.15 for Experts Fees and Expenses;
- USD 15,461.40 for witnesses and personnel costs;
- USD 30,709.52 for the hearing room and;
- USD 446,164.56 for the reporting, translation and ICC Costs (USD 418,381.25).
- USD 5,059,968 for Legal Cost, out of which USD 222,514 were for the claim relating to Vibrating Feeders and USD 4,837,454 for the AG Mill claim;
- USD 263,223.82 for Disbursements, out of which USD 9,327 were for the Vibrating Feeders;
- USD 72,821.94 for Expert and Witnesses Fees and Expenses for the Vibrating Feeders Claim;
- USD 1,738,575.44 for Expert Fees and Expenses for the AG Mill Claim;
- USD 41,700.25 for witnesses and personnel costs;
- USD 28,125 for the hearing room;
- USD 648,568.86 for the Court Reporting, Translation and ICC Costs.
2) Claimants must bear 80 % and Respondents 20% of the Fees and Expenses of the Arbitrators and of the ICC’s Administrative Expenses fixed by the ICC International Court of Arbitration at USD 863,000.00. Claimants are consequently ordered to pay Respondents USD 258,900;
3) Claimants must bear 80% of the reasonable Legal Costs incurred by Respondents as determined by the Arbitral Tribunal, plus the full amount relating to the Vibrating Feeders Claim i.e. USD 4,503,797.32 and are consequently ordered to pay that amount to Respondents;
4) All other requests and claims from the Parties are dismissed.
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