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Communiqué of Weinhold Legal and Milan Polák regarding information published in the media about arbitration proceedings between Škoda Transportation and České dráhy

In the last few weeks the law firm Weinhold Legal (WL) was mentioned in the media several times in connection with the arbitration proceedings between Škoda Transportation (ŠT) and České dráhy (ČD). One of the independent arbitrators of the Arbitration Court attached to the Czech Chamber of Commerce and the Agricultural Chamber of the Czech Republic who was in charge of this case between ŠT and ČD was Milan Polák. He is at the same time an advocate and WL partner.

WL was not involved in this arbitration proceeding at all and therefore any comment about WL in media in connection therewith is absolutely inappropriate. Milan Polák´s role as the arbitrator is not a part of his advocacy practice and has no relation either to his work as a WL advocate or to any WL activity. Furthermore, as an arbitrator Milan Polák is bound by a strict confidentiality duty. Thus, neither Milan Polák nor WL can make any comment to the respective arbitration proceeding and cannot refute speculative allegations of some journalists.

However, both WL and Milan Polák highly appreciate the fact that one of the parties of the dispute (ČD) published the arbitration award on its webpages. Thank to this the public can make its own independent opinion on the substance of the dispute and legal arguments that led the arbitrators to their decision. With respect to some unsubstantiated theories published in various media Milan Polák stresses that:

• The case was judged and decided based on the legal arguments exclusively,
• Selection of two out of three arbitrators was made directly and indirectly by ČD as the
• respondent (the arbitrator appointed by ČD nominated a chairman of the arbitration senate and
• Milan Polák as the arbitrator appointed by ŠT fully accepted this nomination),
• As a standard practice the arbitration award was prepared by the chairman of the arbitration
• senate and subsequently was accepted by Milan Polák,
• Despite of the fact that the arbitrator appointed by ČD did not sign the arbitration award, he did
• not make any dissenting opinion,
• Bias objection against Milan Polák was made only after several years of proceedings when, on 24th of August 2015, all evidence had been submitted and all hearings finished, the draft of the arbitration award was prepared and the last step in the proceedings was taken. The objection of bias was considered by the whole Board of the Arbitration Court and unanimously found completely unsubstantiated. Also the state court rejected a motion for preliminary ruling filed in connection therewith.

While making their decision the arbitrators had to respect the legislation in force, the wording of respective contracts and individual legal acts taken – or omitted - by the parties in dispute in the past.
The fact that the arbitrators decided purely on the bases of law is supported by the fact that according
to the recent information published in press (MfD 19.11.2015) a year ago a proposal for an out of court settlement was considered and ČD ordered a legal opinion on this proposal from its legal advisors representing it in the arbitration proceedings and from two other lawyers. Two out of three legal opinions recommended not to proceed further in the arbitration.