Friendly discussions

The High Court recently upheld an obligation to engage in “friendly discussion” before commencing arbitration, entailing a duty to negotiate in good faith.

In Emirates Trading Agency LLC v Prime Mineral Exports Private Limited [2014] EWHC 2104 (Comm), the High Court has held that an obligation to engage in “friendly discussion” before commencing arbitration was binding and entailed a duty to negotiate in good faith; this could be enforced as a precondition to arbitration. This appears to mark a departure from the position that an agreement to negotiate in good faith is not binding.

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