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Arbitration in Israel
The Arbitration Law 1968
Recongnition and Enforcement of Foregin Arbitral Award
The Arbitration Agreement
The Arbiration Clause
A Consensual Appeal
Stay of Court Proceedings
Justice and Effiecnent Ruleling
Interim Measures
The Arbitral Award
Setting Aside the Award
The New York Convention Regulations
Institutional Arbitration v. ad hoc
International Arbitration & Mediation




Home page Arbitration & A.D.R Stay of Court Proceedings

Stay of Court Proceedings

Stay of Court Proceedings
Date 14/4/2015

Article 5 of the Arbitration Law deals with Stay of Court Proceedings in domestic proceedings whereas Article 6 deals with Stay of Court Proceedings in International Arbitration where a Foreign   Convention which Israel is a party to is applicable.

Article 5:

5. Stay of court proceedings

(a) Where an action is brought before the Court in a dispute that the parties have agreed to refer to arbitration, and a party that is a party to the arbitration agreement requests that the Court order a stay of proceedings, the Court shall stay the proceedings between the parties to the arbitration agreement, provided that the applicant has been, and still is, prepared to do everything required for the arbitration to continue.

 (b) A request for a stay of proceedings may be submitted as part of a Statement of Defense or otherwise, but no later than the day on which the applicant first submitted a substantive pleading in the case.

(c) The Court may refuse to stay the proceedings if it finds special grounds on which the dispute should not be settled by arbitration."

 

There are three main circumstances in which the Court may refuse to stay Court proceedings:

1. There is a need to conclude all the disputes among the relevant parties and staying the court proceedings will refer only part of them to arbitration.

2. The claimant wishes to clear his name in a public forum; or

3. There is a public interest in the disputed matter.

 

As delineated by the Israeli Supreme Court, one of the main considerations that courts will take into account in deciding whether to grant a stay of proceedings order is the need to avoid parallel proceedings in arbitration and in the Court for the same dispute:

Stay of proceedings in International Arbitration

Article 6:

If a claim has been filed before a court in a dispute agreed to be referred to arbitration and an international convention to which Israel is party applies to the arbitration and the convention states directions regarding stay of proceedings, the court shall act in accordance with its authority under Section 5 and in accordance with such directions and subject to them.

The legal relationship between Articles 5 and 6 has not been conclusively decided yet. In any case the Israeli Courts attitude keeps wide discretion relatively in enforcing the N.Y Convention, particularly when public welfare considerations are involved.

 

 

 





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