This case concerned a young Formula 2 racing driver whose team suddenly terminated the contract with him, alleging non-compliance with several minor contractual obligations. This happened only five days before the start of the GP2 Series, which commenced with the Spanish Grand Prix in Barcelona.

The contract contained an arbitration agreement which provided that disputes between driver and team had to be decided by an arbitral tribunal in Italy.

The day before the GP2 series started, the racing driver applied ex parte to the Spanish court for an order requiring his motor-racing team to perform its obligations under the contract, including providing a car and the necessary engineering assistant for the races, pending the commencement of arbitration proceedings in Italy.

The Spanish court granted the interim measure on the same day of its request. The court did not find any obstacle in the fact that the seat of the arbitration was in Italy or that the arbitration proceedings had not been yet initiated. Among its considerations, the court highlighted that the youth of the driver and his future career were very relevant in the granting of the measure. Being prevented from racing for a whole season, while the arbitration was decided, at such an early stage of a driver's career, could have a serious impact and cause damages which would be very difficult to assess.

The order referred, generally, to the GP2 Series. However, it is not yet clear whether this order, issued by a Spanish court as the court of the place of enforcement, would be enforced in other jurisdictions or whether it could affect races in the GP2 series other than the Spanish Grand Prix.

In this case, a Spanish engineering company entered into a contract with an Iranian company for the supply of equipment for the construction of sugar refinery plants in Iran. The Iranian company threatened to call on a first demand bank guarantee, obtained by the Spanish company to secure its obligation to supply equipment. The Spanish company had, in fact, supplied all the equipment under the contract, but faced a likely extend-or-call request addressed to the issuing bank in Iran.

The contract contained an ICC arbitration agreement, with its seat in Geneva (Switzerland).

The Spanish company applied to the Spanish courts for an order, addressed to the Spanish bank which was counter-guaranteeing the transaction, restraining it from extending the guarantee or paying any monies to the Iranian company or to the Iranian guarantor bank. The effectiveness of this measure depended on the Iranian company not knowing about the application and, therefore, an ex parte application was made.

The Spanish court accepted jurisdiction, on the grounds that the measure was to be enforced in Spain (where the bank counter-guaranteeing the transaction was located), and granted the requested measure within a week, a few days before the guarantee's expiration and the expected extend-or-call request. When the Spanish bank in fact received the extend-or-call request from Iran, the court order not to pay had already been notified to it, and it complied with it.

The Spanish Civil Procedure Act requires arbitration proceedings to be commenced within twenty business days of the grant of an interim measure, and the Spanish company complied with this by commencing arbitration proceedings in Switzerland, in accordance with the arbitration agreement.

This is not the first order of its kind issued in Spain. In previous cases, the courts have granted orders preventing abusive calls on bank guarantees, issued in support of international arbitration proceedings. Examples include the Order of the First Instance Court no. 69 of Madrid, 394/1999, of 28 June 1999; and the Order of the First Instance Court no. 42 of Madrid, 286/2004, of 12 March 2004.

International arbitration requires a flexible approach to interim relief. Spanish courts have demonstrated that they are willing to provide quick and effective responses in this regard. In cases such as the two decisions considered in this update, the interim relief has utility only if it is applied for and granted with expedition. Likewise, in some cases, an ex parte application will be necessary to secure effective relief. These recent decisions demonstrate that Spanish courts are willing to provide such relief, as long as the basic requirements for the grant of an interim measure are fulfilled (namely, the establishment of a prima facie right; proof that delay will cause the relief requested to be ineffective; and the provision of security to cover any damages that the order may cause, if it ultimately transpires that it is inappropriate).

Order by the First Instance Court no. 2 of Mollet del Vallès (Barcelona), 272/2008, of 25 April 2008 (unpublished) and Order by the First Instance Court no. 82 of Madrid, 983/2008, of 4 November 2008 (unpublished).