- "It would in principle be inappropriate to consider and resolve novel issues of law in a summary fashion, which would inevitably limit the Parties’ opportunity to be heard and the Tribunal’s opportunity to reflect "1;
- "Given the potentially decisive nature of an Article 41(5) objection [...], it is appropriate that claimant’s Request for Arbitration be construed liberally and that, in cases of doubt or uncertainty as to the scope of a claimant’s allegation(s), any such doubt or uncertainty should be resolved in favor of the claimant "2; and
- "It would therefore be a grave injustice if a claimant was wrongly driven from the judgment seat by a final award under Art. 41(5), with no opportunity to develop and present its case under the written and oral procedures prescribed by Rules 29, 31 and 32 "3.
- Faisal Bander Marzouq Hazem Al-Otaibi [...]: 50%;
- Khalid Bander Marzouq Hazem Al.Otaibi [...]: 50% "23.
"the second party [i.e. Claimant] paid 20 000 000 $ (twenty millions USD) for its share in the land and project to the first party [i.e. Al-Otaibi heirs] what is:
o the amount of 20 000 000 $dollars received by the first party [i.e. Al-Otaibi heirs] in cash in the date of signing of the contract.
o in addition to all the expenses that have been spent in advance in the work of soil sludge and the work of lifting the area and through specialists in the layers of the earth.
o expenses and equipment necessary for the establishment of residential and tourist communities.
o the cost of preparing feasibility studies on this land.
o costs of architectural and construction drawings "25 (item 3).
a. repeated, as in the Request for Arbitration, that "by its partner as a representative of the joint venture agreement "48, it "submitted its disputes against the state of Kuwait before the Kuwaiti instant court on the year of 2011 [...]"49;
b. asserted that, with the exchange of letters between Mr. Al-Otaibi and the Amir of Kuwait, Claimant also submitted by way of representation its claims to Kuwait pursuant to Article 10(2) BIT; and
c. alleged that the exchange of letters between Claimant and Mr. Al-Otaibi is evidencing that Mr. Al-Otaibi acted before the Kuwaiti authorities also on behalf of Claimant.
a. Letter dated January 15, 2011, sent by Claimant to Mr. Al-Otaibi requesting that "pursuant to our joint venture agreement dated 15/5/2019 [...], concerning the registration of the land, [...] he takes all required legal procedures to save guard its rights in the State of Kuwait"50, in particular by taking "pursuant to article no 5 of [the] joint venture agreement, all legal procedures in the state of Kuwait in accordance with the articles stated in the convention of promotion and protecting the investors signed between the state of Egypt and the state of Kuwait in the year 2001 to be ready to submit a request for arbitration before ICSID [...] and to inform them with [Claimant’s] intention to go to arbitration on behalf of us and for our interest as it was mentioned in article 5 of our joint venture agreement "51;
b. A December 8, 2014, request as to the land from Mr. Al-Otaibi’s Kuwaiti lawyer to the Amir of Kuwait52; and
c. An April 10, 2016, request as to the land from Mr. Al-Otaibi to the Kuwaiti Municipality with the words "resorting to arbitration"53 (the Kuwaiti Municipality received the April 10, 2016 request on April 11, 201654), being noted that Mr. Al-Otaibi, who would have had the duty to act "on behalf of the purchaser"55 pursuant to wording of the JVA, was expressly acting "as an agent for the partners and the heirs"56, as mentioned in this April 10, 2016 request.
"[...] the 1982 Al-Taef Agreement sets out procedures in Kuwait that needed to be followed in order for Saudi citizens holding land in the Kuwaiti part of the Neutral Zone to have their property rights over that land recognized under Kuwaiti law. As a Kuwaiti national, these provisions of the Al-Taef Agreement would not have applied to Mr. Al-Otaibi or his brother"80.
"as provided by Article 2 of the 1982 Al-Taef Agreement, 'no further application shall be considered after this period [i.e. the three-month period ending 1st September 1982] for any reason'. Therefore this provision makes clear that the right of Saudi citizens to have property rights in the Kuwaiti area of the Neutral Zone recognized under Kuwaiti law would be lost if the right was not invoked within the deadline set out by the 1982 Al-Taef Agreement (i.e. within three months from 1st September 1982) and proved in accordance with the procedures established therein"81.
a. "Mr. Al-Otaibi's request to obtain a Kuwaiti ownership instrument over the land was unfounded [...] for failure to comply with the various provisions of the international agreements and Kuwaiti implementing law concerning the Neutral Zone"85; and that
b. "the Saudi instrument dated 2 September 1971 brought by Mr. Al-Otaibi as a basis for his petition was later that 26 July 1966, the date of entry into force of the 1965 Agreement, after which date the Land had become Kuwaiti territory and 'part of the Sate properties'"86.
a. "on 15 January 2011, the Claimant sent a letter to Mr. Faisal Bandar Al-Otaibi inviting him to take all legal procedures in the state of Kuwait on behalf of the Claimant and for his interests pursuant to item 5 of the joint venture agreement and in accordance with the articles stated in the Agreement for the promotion and reciprocal protection of investments between the state of Egypt and Kuwait 2011 as a preliminary approach in order to submit request for arbitration before ICSID [...] to inform them with the claimant’s intention to go to arbitration before ICSID (c-9)"94.
b. Claimant’s purpose was to "convince the State of Kuwait to back down from its illegal refusal to register our land in the State of Kuwait, based on our deed of ownership dated 2/9/1971 and our joint venture agreement dated 15/5/2009 (c-1, c-2 & c-5) [...]"95.
c. According to Claimant, "Mr. Faisal Al-Otaibi as he is our representative before the State of Kuwait sent many complaints to the Prince of the State of Kuwait [...] in which it was clearly stated our intention to solve the disputes by arbitration before ICSID if it is not solved by the State (c-8.1), see the last line of the letter of 8/12/2014 [...]"96.
d. Claimant added that "[i]n addition to the above-mentioned letter [...], our agent, Mr. Faisal Bander Al-Otaibi, sent two letters on behalf of himself and heirs and on behalf of the Claimant and for its interest dated 10 April 2016 [...] to the Director General of the Municipality requesting to register the land [...] or otherwise the arbitration proceedings will be taken before ICSID [...] (c-8.2)"97.
e. Claimant submitted exhibit C8 which entails in particular a letter as to the Land from Mr. Faisal Al-Otaibi's Kuwaiti lawyer dated December 8, 2014 requesting the Amir of Kuwait to "instruct the competent authority to discuss my request by issuing a Kuwaiti ownership document [...]"98 but this letter does not mention arbitration proceedings99.
f. Arbitration proceedings are however mentioned in a letter as to the Land (submitted by Claimant as exhibit C8) dated April 10, 2016 from Mr. Faisal Al-Otaibi to the Kuwaiti Municipality which reads as follows: "We ask your attention to [...] inform the competent authority to issue the Kuwaiti title instrument or resorting to arbitration "100. Claimant insisted, during the hearing101, on the information stated in this letter dated April 10, 2016 as to the signing person: "Faisal Bandar Marzouq Al-Otaibi, in his capacity as an agent for the partners and the heirs"102. As per an acknowledgement of receipt dated April 12, 2016103, the Kuwaiti Municipality received the April 10, 2016 request on April 11, 2016.
a. Article 1(1)(b), (c) and (e) BIT to allege that the definition of investment is met (Claimant "invested its money in the purchase of 5% of the entire plot of land [...] in the establishment of touristic and residential buildings "113);
b. Article 1(3) BIT (definition of investment proceeds "which relates to the Claimant investment revenues and profits that have been lost due to the expropriation [...] and not enabling the owner (the Claimant) to exercise its investment activity as an owner to benefit from its revenues "114);
c. Article 1(5) BIT to allege that "the land subject of this case is located in the territory of the State of Kuwait after the signing of the Al-Taef Convention "115;
d. Article 2(2) BIT which provides that the contracting states have the duty to provide the investments and the activities linked to them with the necessary permissions, approvals and authorisations116;
e. Article 3(1), (3), (4), (5), (6) and (7) BIT aiming at the protection of investments (nondiscrimination, right of recourse to courts, no discriminatory restriction as to purchase of products necessary or useful for production, no performance requirements which are not justified by public interest, no expropriation breaching principles of international law, full compliance with commitments to which Kuwait is a party)117.
a. Article 7(3) BIT, providing that the term "expropriation" also includes the interference of a Contracting State with an enterprise in which an investor belonging to the other Contracting State has a majority or important share121; and on
b. Article 7(4) BIT which provides that the term "expropriation" includes "other similar procedures having the same effect of seizing the property or expropriating if "122.
- "In this agreement, the Claimant (the second party) purchased 5% of the Kuwaiti land owned by the first party for an amount of $20 million [...] to invest in this land to establish such constructions and touristic resorts and to obtain 10% of all profits gained from land and constructions (item 1,3 of the agreement c-5)"123; and
- "In this agreement, the first party committed to guarantee the transfer of the land and the share of the ownership of the land to the Claimant and to issue a deed from the State of Kuwait in the name of the Claimant [...] (item 5 of the agreement c-5)"124.
a. "Mr. Faisal Bandar Al-Otaibi and his brother are the heirs of the late Bandar Al-Otaibi (c-2), who had purchased this land from Mr. Abdullah bin Abdelhady Akshan (Saudi nationality) on 2/9/1971 by virtue of a legal deed issued by the judge of Qaisoumia court in the Kingdom of Saudi Arabia (c-1). [...] Mr. Abdullah bin Abdelhady Akshan (Saudi nationality) was the owner of the land under the title deed issued by King Saud in the year 1900 and the Royal Decree of 1965 in accordance with the content to the judgment of Qaisoumia Court (c-1).[...] And no one claims otherwise. Therefore, the sequence of ownership of this land until it reached the plaintiff is true and no doubt of that"126.
b. Claimant also argues that the Saudi deed "has been legally issued and has been ratified and approved by the Saudi court and stamped and ratified by the Kingdom of Saudi Arabia [...], and there is no other judgements, laws or decisions in Saudi Arabia ignoring or denying this deed"127. Claimant also exlains that "transferring of sovereignty does not mean that the owner of the land has lost ownership"128.
a. pursuant to the meeting "minutes of the final report of the Studying Committee Concerning the Claims and Allegations of Kuwaiti Citizens in Zour and Wafra areas no 6/2011"129, referred to in the judgement of the Kuwaiti administrative court130("c-4 p4 para 2 "131), the ground for refusing to grant a Kuwaiti title to the Land to Mr. Faisal Al-Otaibi was as follows: "article 2 of the Al-Taef Agreement (c-6) [...] stipulated that the government of Kuwait shall open the registration of requests [...] starting from the first of September 1982 for a period of 3 months [...], further requests shall not be considered for any reason "132.
b. Pursuant to the judgement rendered by the Kuwaiti Court of Appeal133("p8 para 2 & p9 "134) as to the Land, and pursuant to the minutes of the final report of the Studying Committee Concerning the Claims and Allegations of Kuwaiti Citizens in Zour and Wafra areas no 6/2011135("c-11 p4 para 1&3 "136), "the instrument issued for the land mentioned in the case of Mr. Faisal Bandr Al-Otaibi was issued on 2/9/1971, after 8/6/1966 the date of ratification of the partition agreement "137.
a. "The Saudi Court cannot issue a deed of ownership of a land not located in the Kingdom of Saudi Arabia, as well as for the ratification issued by the Saudi Government "139.
b. Notwithstanding the transfer of sovereignty to Kuwait, Kuwait must comply with the ownership rights ("under these two international conventions [the 1965 Agreement and the Al-Taef Convention], this land was transferred to the Kuwaiti state bearing its obligations which are the ownership of Mr. Faisal Bandar Al-Otaibi "140).
c. "The Kingdom of Saudi Arabia’s government and courts said that Mr. Faisal Bandar Al-Otaibi is the owner of this land [...], and no other owner put his hand on it"141.
d. Claimant refers, in its Observations142, to two decisions143 of the Kuwaiti Council of Ministers: The first one, dated October 16, 1983 states that engineering measures of the State of Kuwait "will eventually result in the expropriation of all residential and non-residential areas in the old villages of Al-Wafra and Al-Zour"144; the second one, dated May 29, 1995, was about the issuance of "documents of real estate ownership of Saudi citizens"145.
e. Claimant cites a Kuwaiti court case:
i. Claimant describes the case as follows: it is about a "final and binding judgement which has been issued by the Kuwaiti court in favor of Mr. Juman Salim Al-Dosari who holds a title deed from the Saudi government dated 9/3/1388 A.H. for the year of 1968 in the same area as the Claimant land"146. Claimant further adds that Mr. Al-Dosari's land was purchased from a "Saudi person during year 1968, after the signing of the 1966 Agreement"147.
In this respect, the judgment of the Kuwaiti "Primary Court"148 dated November 14, 2011 submitted by Claimant with its Observations, held that: "Nasser Salim Nasser Ali Al-Dosari, Kuwaiti Nationality, owned a property [...] in Al-Zour area in the petitioned neutral zone between Kuwait and Saudi Arabia under the original instrument [...] registered No. 114/m on 9/3/1388 A.H. purchased from Salem Fnkhor bin Mohammed Alkatheri (Saudi nationality)"149 (pages 1-2), and "it's proved to the court that [...] the dispute is over an empty land located[...] in Al-Zour area, which plaintiffs own in common under a deed of title issued by the Saudi Sharia Court No. 114m.s.67, which was expropriated for the Neutral Zone between the State of Kuwait and the Kingdom of Saudi Arabia, [...] which is estimated at KD 45,000 (forty five thousand Kuwaiti Dinars) "150 (page 4 of translation).
ii. In its judgment, the Kuwaiti "Primary Court" "ruled: [...] Second: obligating the second plaintiff [Kuwaiti Ministry of Finance] to grant the plaintiffs an amount of KD 45,000 (forty five Kuwaiti Dinars) "151 (page 5 of translation).
iii. On February 28, 2012, the Kuwaiti Court of Appeal rejected the appeals filed against the decision of November 14, 2011 of the "Primary Court"152.
iv. On June 26, 2013, the Kuwaiti Cassation Court rejected an appeal filed against the February 28, 2012 decision of the Court of Appeal153.
v. As to the grounds relied on by the Kuwaiti courts to indemnify Mr. Al-Dosari for the expropriated land, Claimant contends that they "ruled that the dates contained in the Al-Taef Agreement had no law to govern and could not be invoked "154.
In this respect, as the Kuwaiti authorities objected that Mr. Al-Dosari's claim should be held inadmissible since it would have been untimely, the Kuwaiti Court of Appeal held, in its February 28, 2012 decision, that "the law does not specify special dates for the claims to be observed"155 (page 11 of translation). It shall be noted that the Kuwaiti Court of Cassation did not address this issue in its June 26, 2013 decision.
vi. With respect to the Al-Dosari case, Claimant concludes that the two decisions "are contradictory, one of them against Mr. [...] Al-Otaibi and another to the favor of Mr. [...] Al-Dosari "156, even though they "speak of the same subject and respond to the same objections raised from the State of Kuwait "157.
a. Because the size of the Land excluded such procedure: The application for the registration of ownership by Kuwait was open for "land that does not exceed 2500 square meters only"160 pursuant to Article 2 of the Al-Taef Convention, while "Mr. Faisal Bandar Al-Otaibi's property is 800,000 square meters "161.
b. Because the date of the property deed (1971) as to the Land excluded the procedure provided for by the Al-Taef Agreement: The registration of ownership by Kuwait was open for "land that have officially fixed date before 26 July 1966"162 (Article 2 of the Al-Taef Convention).
"First: Accept the Claimant’s claim in form and subject.
Second: The rejection of the objection submitted by Respondent on 3 September 2018 in form and in subject matter.
Third: Determining the right of the Claimant to ownership of the land.
Fourth: Appointment of an expert to assess the value of the disputed land [...].
Fifth: order the Respondent to pay an amount of 320 millions US dollars to remedy all related damages occurred to the Claimant for losing its profit and for all expenditures on feasibility studies, experts reports, administrative fees, litigation and arbitration fees"165.
Unless the parties have agreed to another expedited procedure for making preliminary objections, a party may, no later than 30 days after the constitution of the Tribunal, and in any event before the first session of the Tribunal, file an objection that a claim is manifestly without legal merit. The party shall specify as precisely as possible the basis for the objection. The Tribunal, after giving the parties the opportunity to present their observations on the objection, shall, at its first session or promptly thereafter, notify the parties of its decision on the objection. The decision of the Tribunal shall be without prejudice to the right of a party to file an objection pursuant to paragraph (1) or to object, in the course of the proceeding, that a claim lacks legal merit.
"Non-compliance with the six month period, therefore, does not preclude this Arbitral Tribunal from proceeding. If it did so, the provision would have curious effects, including:
- preventing the prosecution of a claim, and forcing the claimant to do nothing until six months have elapsed, even where further negotiations are obviously futile, or settlement obviously impossible for any reason;
- forcing the claimant to recommence an arbitration started too soon, even if the six-month period has elapsed by the time the Arbitral Tribunal considers the matter "196.
"We submit that this case is one that proves that the system is being clearly abused by Claimants that file frivolous claims. We ask you to send a strong message that this abusive use of the investor state dispute settlement system will not be tolerated"197.
a. The interpretation of the 1964 Agreement and of the Al-Taef Convention is a complex novel issue of law, and "Rule 41(5) is not intended to resolve novel, difficult or disputed legal issues, but instead only to apply undisputed or genuinely indisputable rules of law "215. because "it would in principle be inappropriate to consider and resolve novel issues of law in a summary fashion, which would inevitably limit the Parties’ opportunity to be heard and the Tribunal’s opportunity to reflect "216. This is one of the arguments Claimant relied on: "Rule 41(5) should not by any means lead to affect negatively the duty of the Tribunal in maintaining the due process "217.
b. Respondent first explained that "the purported sale of the Land to Mr. Al-Otaibi’s father and issuance of the Saudi instrument in 1971 occurred more than six years after the Land had already become Kuwaiti territory pursuant to the 1965 Agreement"218. Respondent changed its argument when it explained later, during the December 14, 2018 hearing, that the demarcation between the two countries in the former neutral zone was agreed-upon in 1969 only. Indeed, as then argued by Respondent, "the 1965 treaty did establish the division of the neutral zone. It called for the demarcation to be carried out pursuant to a procedure. The procedure was carried out, and confirmed in a supplementary agreement which was signed at Kuwait on 18th December 1969 "219. Respondent did not submit the text of the "supplementary agreement" to the Tribunal and did not state the date of its entry into force. Further, it failed itself to present an univocal position as to the date when sovereignty on the Land was transferred to Kuwait, and, moreover, Claimant expresses a third position with a sovereignty transfer after 1971. Consequently and obviously, the requirement according to which "Rule 41(5) is not intended to resolve [...] difficult or disputed legal issues, but instead only to apply undisputed or genuinely indisputable rules of law"220 is not complied with.
c. Both Claimant221 and Respondent222 alleged, in their briefs, that Mr. Faisal Al-Otaibi and his co-heir appealed the judgement of the Kuwaiti Court of Appeals before the Kuwaiti Court of Cassation and that no decision had been rendered. Both Claimant223 and Respondent224 confirmed, during the December 14, 2018 hearing, that the Kuwaiti Court of Cassation had not rendered any decision. Because of the pending proceedings before the Kuwaiti Court of Cassation, Claimant argues that "the judgements are not yet final or binding "225. The reality is that Respondent fails to demonstrate that Mr. Faisal Al-Otaibi's ownership is, "obviously" as required by Rule 41(5), excluded: Of course, nobody can exclude that the Kuwaiti Court of Cassation renders a decision in favor of Mr. Al-Otaibi (and Respondent did not allege that such decision would be excluded).
a. For Claimant, the Saudi deed "has been legally issued and has been ratified and approved by the Saudi court and stamped and ratified by the Kingdom of Saudi Arabia and there is no other judgements, laws or decisions in Saudi Arabia ignoring or denying this deed "226. The mere existence of the 1971 deed issued by the Saudi Court as to the ownership of the Land renders Respondent's position in this regard troubling: Respondent fails to explain why a Saudi Court would have issued an ownership deed in 1971 if, as contended by Respondent, the Land would have been located in 1971 on the Kuwaiti territory (what Respondent also failed to demonstrate pursuant to the requirements of Rule 41(5), as explained supra). Respondent thus fails, for this additional reason, to demonstrate that, "obviously"" as required by Rule 41(5), the deed should be totally disregarded by the Tribunal.
b. Respondent does not deny that, in the Al-Dosari case, as alleged by Claimant:
i. A "final and binding judgement which has been issued by the Kuwaiti court in favor of Mr. Juman Salim Al-Dosari who holds a title deed from the Saudi government dated 9/3/1388 A.H. for the year of 1968 in the same area as the Claimant land"227; and
ii. Mr. Al-Dosari's land was purchased from a "Saudi person during year 1968, after the signing of the 1966 Agreement "228.
Actually, as exposed supra, the Kuwaiti Courts entered a final decision recognizing Mr. Al-Dosari's ownership, and indemnifying Mr. Al-Dosari for the expropriated land, even though his ownership deed had been issued by Saudi Arabia after the 1965 Agreement. This case, in conjunction with the lack of explanation on the part of Respondent, is troubling, since the Kuwaiti Courts recognized Mr. Al-Dosari's ownership in apparently similar circumstances as in Mr. Faisal Al-Otaibi's case, while the same Kuwaiti Courts, so far, rejected Mr. Faisal Al-Otabi's claims. Mr. Al-Dosari's case, and the absence of any explanations from Respondent in this regard, is an additional reason preventing Respondent from demonstrating, "obviously" as required by Rule 41(5), that Mr. Faisal Al-Otabi's ownership over the Land would be excluded.
c. As to the owners of the Land over time, Claimant alleged that:
"Mr. Faisal Bandar Al-Otaibi and his brother are the heirs of the late Bandar Al-Otaibi (c-2), who had purchased this land from Mr. Abdullah bin Abdelhady Akshan (Saudi nationality) on 2/9/1971 by virtue of a legal deed issued by the judge of Qaisoumia court in the Kingdom of Saudi Arabia (c-1). [...] Mr. Abdullah bin Abdelhady Akshan (Saudi nationality) was the owner of the land under the title deed issued by King Saud in the year 1900 and the Royal Decree of 1965 in accordance with the content to the judgment of Qaisoumia Court (c-1).[...] Therefore, the sequence of ownership of this land until it reached the plaintiff is true and no doubt of that "229.
Even though Claimant alleged, and referred to exhibits it adduced before the Tribunal, the sequence of owners of the Land since 1900, Respondent fails to give any explanations as to this sequence, except that the Land would have been located in 1911 on the Kuwaiti territory what would prevent Claimant from relying on the Saudi deed (Respondent failed to demonstrate, pursuant to the requirements of Rule 41(5),that the Land would have been located in 1911 on the Kuwaiti territory, as explained supra). In particular, Respondent fails to give any explanations as to the 2009 document, issued by the "State of Kuwait, Ministry of Justice, Legal Authentication Department, Division of Estate "230, stating that "in accordance with Succession Limitation no. 1572/2004 + Deeds issued by the Sharia Courts no. 412 - 11/7/1391 + draft drawing as per the Deeds no. 412 dated 11/7/1391 A.H., heirs of Bander Marzouq Hazem Al-Otaibi: Faisal Bander Marzouq Hazem Al-Otaibi [...]: 50%; Khalid Bander Marzouq Hazem Al.Otaibi [...]: 50%"231, being reminded that the reference "no. 412 -11/7/1391" matches with the 1971 Saudi deed Claimant relies on. In other words, even though Exhibit C2 is a document issued in 2009 by a Kuwaiti authority stating that, as alleged by Claimant, Mr. Faisal Al-Otaibi and his brother (in their capacity as their father's heirs) would be the owners of the Land, Respondent does not explain why this document should be disregarded: There is a significant material inconsistency between Respondent's position and a document issued by its own administration adduced in evidence by Claimant, without any explanations on the part of Respondent. The lack of explanations on the part of Respondent as to this document issued by its administration is an obvious and serious hurdle to the Rule 41(5) objection, what could render Respondent's objection abusive (this issue of abuse of right may remain undecided since Claimant does not raise it). At the very least, the lack of allegations and arguments on the part of Kuwait as to Exhibit C2 prevents Respondent from demonstrating that, "obviously" as required by Rule 41(5), Mr. Faisal Al-Otaibi's ownership over the Land would be excluded.
The Award of the majority of the Tribunal simply ignores exhibit C2. It ignores a relevant document relied upon and validly adduced in evidence by Claimant232, which is issued by Respondent's own administration and which prima facie confirms the validity of the 1971 Saudi deed and the ownership of the Land by Mr. Faisal Al-Otaibi and his brother. There is an obvious and significant contradiction between exhibit C2 and the statement in the Award that "Claimant has not provided evidence that such title [issued by Saudi Arabia in favor of a Kuwaiti national] has been recognized or registered by any Kuwaiti authority"233. Should the Award have not ignored Exhibit C2, it would have come to the conclusion that, by failing to give any explanations as to Exhibit C2, Respondent did not demonstrate that, "obviously" as required by Rule 41(5), Mr. Faisal Al-Otaibi's ownership of the Land would be excluded. The Award not only breaches Rule 41(5): By ignoring a relevant piece of evidence relied upon by Claimant, the Award comes to a conclusion detrimental to Claimant, and thus fails to comply with due process requirements. The majority of the Tribunal failed to comply with the most basic and important duty of arbitral tribunals, i.e. to consider and discuss all the relevant exhibits validly adduced in evidence.
d. As to the current owner of the Land, Claimant alleged that "no other owner put his hand on it"234. Even though Respondent235 considers itself as the owner of the Land, it actually failed to provide any property title. Since Respondent does not prove to be the legitimate owner of the Land, we cannot consider that, "obviously" as required by Rule 41(5), Claimant’s claims would have to be dismissed in a summary way.
- "In this agreement, the Claimant (the second party) purchased 5% of the Kuwaiti land owned by the first party for an amount of $20 million [...] to invest in this land to establish such constructions and touristic resorts and to obtain 10% of all profits gained from land and constructions (item 1,3 of the agreement c-5f"236; and
- "In this agreement, the first party [Mr. Al-Otaibi and his brother] committed to guarantee the transfer of the land and the share of the ownership of the land to the Claimant and to issue a deed from the State of Kuwait in the name of the Claimant [...] (item 5 of the agreement c-5)"237.
- During the December 14, 2018 hearing, as to the ownership of the land, counsels to Respondent relied once again on Respondent’s one and only legal argument: "there cannot be any expropriation of Claimant’s property rights when not even Mr. Al-Otaibi, who allegedly sold part of the land to Claimant, has property rights over the land under Kuwaiti law "242.
- However, at the end of the December 14, 2018 hearing only, which was the last opportunity for the parties to present their arguments as to the Application, after a member of the Tribunal asked a question as to the Kuwaiti Real Estate Registration Law243 while none of the Parties had previously mentioned this law, Respondent relied for the first time on an second argument which it had not raised before (to try to demonstrate that Claimant would not be the owner of the Land): under "Article 7 of that law [Kuwaiti Real Estate Registration Law,] [...] ownership of real property is effective upon registration of that property "244. Respondent however failed to provide to the Tribunal a copy of the considered Kuwaiti Real Estate Registration Law, along with a translation thereof into English. Respondent merely cites one of the decisions rendered by Kuwaiti Courts as to the Land245 which allegedly would provide an exact translation of an exact excerpt of the Real Estate Registration Law. The established rule is that Respondent’s demonstration must be "obvious" for the purpose of Rule 41(5): One can of course not dismiss Claimant’s case on the basis of one mere article of a Kuwaiti law allegedly reproduced with accuracy in a decision of the Courts of Kuwait, all the more since this decision is contested by Claimant and currently subject to pending appeal proceedings before the Kuwaiti Court of Cassation. The Tribunal should have been able to verify the accuracy of the text of this Kuwaiti law by relying on the full text of this law which the Respondent did not adduce in evidence. Also, since Respondent failed to submit the full text of the law it relied on for the first time at the end of the December 14, 2018 hearing, which was the last opportunity for the Parties to express their views on the Rule 41(5) objection, Claimant was practically prevented from commenting on Respondent’s argument as to the Real Estate Registration Law.
- Further, even if Respondent argues that ownership of 5% of the Land could not have been transferred to Claimant because Mr. Al-Otaibi and his brother would not own the Land (which Respondent fails to demonstrate as exposed supra, in particular because exhibit C2 seems prima facie to prove that Mr. Al-Otaibi and his brother have been the owner of the Land), and because ownership would not have been registered by Respondent’s own real estate registry pursuant to the Real Estate Registration Law, Respondent did not deny that the JVA would be proper per se to grant to Claimant the right to claim the Land and to obtain the registration of the Land. Since Exhibit C2 states prima facie (and it is not denied by Respondent) that Mr. Al-Otaibi and his brother have owned the Land, the Tribunal cannot exclude (Respondent does not even allege such exclusion) that the JVA would be proper to provide to Claimant the rights it claims as to the land: the right to claim it and the right to obtain the registration of its alleged ownership.
- The Award holds that the JVA "cannot be the basis of a property title"246. There is no other arguments as to property rights. In particular, the Award does not state, in its expeditious reasoning, which private international law statute and which substantive law provisions would apply. Moreover, Respondent itself did not raise the argument that the JVA "cannot be the basis of a property title". This is a breach of Rule 41(5) since a Rule 41(5) objection must be dismissed if "Respondent has not satisfied the applicable standard of proof in regard of its [...] objections under Rule 41(5)"247: In other words, under Rule 41(5), an arbitral tribunal is barred from substituting the respondent’s deficient Rule 41(5) objections with the tribunal’s own views.
The same reasoning applies to the issue of the Kuwaiti Real Estate Registration Law: It is a member of the Tribunal who told the Parties about the application of this law and not Respondent, and Respondent failed to provide a full copy of this law with a translation thereof. Consequently, "Respondent has not satisfied the applicable standard of proof in regard of its [...] objections under Rule 41(5) "248, and thus Respondent’s objection as to the ownership of the Land must be dismissed. Further, the Award fails to mention a part of the provision of the Real Estate Registration Law it refers to. Indeed, Art. 7 par. 3 of this law (as mentioned in the translation of the judgement contested before the Kuwaiti Court of Cassation) provides that "the unregistered act shall have on effects but the personal obligations among the concerned persons "249, which means, prima facie at least, that Claimant would still have all the rights arising under the JVA, including the right to obtain the recognition of its property rights, even though Kuwait would illegally, as argued by Claimant, refuse to register the ownership of the seller (i.e. of Mr. Faisal Al-Otaibi and his brother). Claimant is prima facie likely to have the right to the recognition of its ownership, and its case cannot be dismissed since the lack of property rights is not rendered "obvious" by Respondent, as required by Rule 41(5). We come incidentally to the conclusion that the Award mistakenly mixes up the right to obtain the recognition of property rights with the ownership itself, to deny any rights to property to Claimant.
- Regarding the additional rights claimed by Claimant: Respondent did not deny, in its Application or during the December 14, 2018 hearing, that the JVA would give Claimant the contractual rights it alleges, in particular with respect to the recognition of ownership of Land, to the share of the real estate project and to the profits (once again, Respondent’s objection as to the alleged expropriated rights focused exclusively on "property rights "250).
- Consequently, Respondent fails to demonstrate that, "obviously" as required by Rule 41(5), Claimant would not be the owner of the Land. In addition, Respondent fails to contend, and thus to demonstrate, that Claimant would not hold the other rights it alleges, such as the right to the registration of its alleged ownership, the right to a share of the real estate project and the right to the profits deriving from the JVA, since Respondent opted to remain silent as to these additional rights alleged by Claimant.
- Like Respondent, the Award ignores the allegations of Claimant as to its right to the registration of its alleged ownership, as to the right to a share of the real estate project and as to the right to the profits deriving from the JVA, even though they could prima facie be subject to expropriation under Art. 7 BIT. Ignoring these relevant arguments raised by Claimant is an additional breach of due process requirements.
- In the Request for Arbitration: "The Claimant - in accordance with this agreement [i.e. the JVA]- purchased and became the owner of 5% of the property of the whole land"253.
- In Claimant’s Observations: "Mr. Faisal Bandar Al-Otaibi and his brother are the heirs of the late Bandar Al-Otaibi (c-2), who had purchased this land from Mr. Abdullah bin Abdelhady Akshan (Saudi nationality) on 2/9/1971 by virtue of a legal deed issued by the judge of Qaisoumia court in the Kingdom of Saudi Arabia (c-1). [...] Mr. Abdullah bin Abdelhady Akshan (Saudi nationality) was the owner of the land under the title deed issued by King Saud in the year 1900 and the Royal Decree of 1965 in accordance with the content to the judgment of Qaisoumia Court (c-1).[...]
And no one claims otherwise. Therefore, the sequence of ownership of this land until it reached the plaintiff is true and no doubt of that "254.
- During the December 14, 2018 hearing, Claimant alleged:
o "The Kuwaiti Government does not want to recognise my ownership right and does not want to let me exercise my right to ownership "255.
o "So we have several aspects: it's a denial of ownership and it's a denial of my right to exercise this ownership"256.
o "the Respondent has the key in his hand whether to ratify this ownership or not. They refrain and preclude me from registering this established ownership"257.
- Claimant relied262 on Exhibit C2, which is the 2009 document issued by Kuwait's own administration stating, prima facie at least, that Mr. Faisal Al-Otaibi and his brother, as their father's heirs, have inherited and have owned the Land;
- The legal proceedings initiated before Kuwaiti courts are currently pending before the Kuwaiti Cassation Court, as admitted expressly by Respondent (and Claimant). Consequently it is simply false to contend, as Respondent alleged it, that it is a "fact [...] that those [Kuwaiti] courts have ruled against Mr. Al-Otaibi and found that his claim of ownership is unfounded "263.
- "The Claimant and its partner was shocked when the government of the state of Kuwait inform them that it will neither register the land with their name nor compensate them [...] by this act the investment of the claimant in the state of Kuwait was totally destroyed"267.
- "Illegal refusal to register our land in the State of Kuwait, based on our deed of ownership dated 2/9/1971 and our joint venture agreement dated 15/5/2009 (c-1, c-2 & c-5) [...]"268.
- "The exact act is their [Kuwait’s] denial of facilitating us to get our ownership deed, which goes under the word, or the statement in Article 7, or any other procedure has similar effect for precluding the investor to proceed with his investment in Kuwaiti territory"269.
- "My ownership right was not recognized and I was prevented from exercising my investments, from carrying them our "270.