Pathological clauses are not an infrequent occurrence in the arbitration world. We often see arbitration clauses which are poorly drafted and may result in rendering the clause inoperable. Being able to predict how a court would treat a pathological clause would help the parties and specifically the party wishing to file proceedings decide whether they…

A recent international arbitration case administered by the Permanent Arbitration Court attached to the Hungarian Chamber of Commerce and Industry (“HCCI Arbitration Court”) demonstrated that Hungary follows the international trend in dealing with the enforceability of pathological arbitration clauses. Arbitration clauses are pathological if they contain defective elements, thus making their interpretation at best uncertain,…

This article addresses the Brazilian Superior Court of Justice (STJ) ‘s precedents on the exceptions to the Competence-Competence principle due to pathological arbitration agreements present in contracts of adhesion. In addition, it approaches the Court’s position on the enforcement of a pathological (empty) arbitration clause. The decisions below are landmark precedents and clarify crucial points…