THE BINDING OF THIRD PARTIES TO THE ARBITRATION CLAUSE AND THE SUBROGATION OF INSURERS IN THE ACTIONS AND RIGHTS OF INSURED PERSONS

Abstract

Resolving disputes through arbitration depends on the unequivocal consent of the parties to accept the arbitration clause, in accordance with the principle of autonomy of the parties’ will. However, the subjective extension of the effects of the arbitration clause to non-signatory third parties has been admitted, provided that other elements demonstrate their unequivocal consent to the arbitration clause. By paying indemnity to the insured, the insurance company subrogates to its rights, assuming the legal position of the insured in the contract containing the arbitration clause, which is the subject of the insurance (Article 786 of the Brazilian Civil Code). Nevertheless, mere subrogation of the insurer is not enough to bind the insurance company to the arbitration clause agreed upon between the insured and the third party who caused the act leading to the insurance indemnity. It is also necessary to consider other elements in the case that demonstrate the third party's unequivocal declaration of intent to be bound by the arbitration clause.