Facts:

Appellant: Ernesto Francisco, a Philippine national, employed aboard the M/T Stolt Achievement (the
vessel), injured on a chemical tanker ship located on the Mississippi River

Respondent: Stolt-Nielsen Transportation Group, Inc., (Stolt) a Liberian corporation, allegedly operating
the vessel.

 The employment contract contains

o Section 29 of the "Standard Terms and Conditions" that in the event of "claims and
disputes arising from this employment," the parties agree to arbitrate their disputes in
the Philippines.
o Section 31 of the same document provides that "[a]ny unresolved dispute, claim or
grievance arising out of or in connection with this Contract . . . shall be governed by the
laws of the Republic of the Philippines, international conventions, treaties and
covenants where the Philippines is a signatory."
 Actions
Action Court Basis
EF sued Stolt Louisiana state court  Jones Act
 General maritime law for
unseaworthiness and for
maintenance and cure.
 authorized by the saving to suitors
clause of 28 U.S.C. § 1333(1).1
Stolt removed the case federal district court  EF signed an employment contract
agreeing to arbitrate claims against
Stolt in the Philippines
 agreement subject to the
Convention on the Recognition and
Enforcement of Foreign Arbitral
Awards.
- US and the Phils are signatories
EF - motion to remand the Federal district court
case to state court - denied
Stolt - motion to compel Federal district court
arbitration under 9 U.S.C. § - granted
206. arbitration
- dismiss suit
EF – Appeal US CA for the 5th
Circuit

Issue: Whether EF was compelled to arbitrate his claims against Stolt?

1
28 U.S.C. § 1333 provides that the federal district courts have exclusive jurisdiction of "[a]ny civil case of
admiralty or maritime jurisdiction, saving to suitors in all cases all other remedies to which they are otherwise
entitled
Ruling: Yes, per his employment contract, EF was compelled to arbitrate his claims with Stolt. The district
court concluded that it should compel arbitration because this case fell under the arbitration provision of
the employment contract, as well as the provisions of the Convention Act and the Convention.

EF Legal Basis
3 arguments a. Court should compel arbitration if (1) there is an agreement in
1. His case does not fall under writing to arbitrate the dispute, (2) the agreement provides for
the Convention Act because arbitration in the territory of a Convention signatory, (3) the
there is an exception agreement arises out of a commercial legal relationship, and (4)
making that Act inapplicable a party to the agreement is not an American citizen.
to seaman employment - These elements were met in the pending case. Francisco, a
contracts. Philippine national, signed a written employment contract
- § 1 of the Arbitration Act, stating that claims and disputes arising from his employment,
seaman employment including personal injury claims, were subject to arbitration
contracts are excluded in the Philippines. The employment contract states that it
from the reach of the shall be governed by the law of the Philippines and such
Convention Act. conventions and treaties to which the Philippines is a
signatory. The Philippines and the United States are both
signatories to the Convention.
b. While the Arbitration Act contains such an exception, the
language from § 202 of the Convention Act states only that the
legal relationships covered by the Convention Act include those
transactions covered by § 2 of the Arbitration Act. The
Convention Act does not state that agreements falling under the
Convention are exclusively limited to those which also fall under
§ 2 of the Arbitration Act, and makes no mention of the exclusion
for seaman employment contracts found in § 1 of the Arbitration
Act.
c. doubts as to whether a contract falls under the Convention Act
should be resolved in favor of arbitration, in light of the Supreme
Court's recognition generally of "the strong federal policy in
favor of enforcing arbitration agreements.
d. the goal of the Convention, and the principal purpose
- encourage the recognition and enforcement of commercial
arbitration agreements in international contracts and to
unify the standards by which agreements to arbitrate are
observed and arbitral awards are enforced in the signatory
countries.
a. The suspension of section 20(G) only means that the seaman no
2. Under the Convention itself, longer acknowledges that the receipt of scheduled payments
his case is not "capable of set out in the contract are the only benefits he can recover from
settlement by arbitration" his employer.
and otherwise does not fall b. The suspension of section 20(G) does not render the dispute
under the Convention. incapable of settlement by arbitration under these provisions.
- PH SC suspended section Even if section 20(G) is rendered a nullity, the parties still agree
20(G) of the standard to arbitrate their dispute under section 29 of the terms and
terms and conditions of conditions of the contract, discussed above; section 20(G) only
limits the claims available to Francisco. If anything, the
 his employment suspension would seem to give the arbitrators greater discretion
contract. to grant the relief to which Francisco thinks he is entitled.
- suspension of section c. An arbitration before the Philippine National Labor Relations
20(G) means that the Commission (NLRC), Section 10 of the Migrant Workers and
Convention no longer Overseas Filipino Act of 1995 does not appear to limit awards to
governs his claims those damages set out in the employment contract.
against Stolt. - In cases before the NLRC labor arbitrators "shall have the
- Article V(2)(a) of the original and exclusive jurisdiction to hear and decide . . . the
Convention, - claims arising out of an employer-employee relationship or
“recognition and by virtue of any law or contract involving Filipino workers for
enforcement of an overseas deployment including claims for actual, moral,
arbitral award may be exemplary and other forms of damages."
refused if "[t]he subject
matter of the difference
is not capable of
settlement by arbitration
under the law of" the
country where
enforcement is sought.

A. The contract clearly provides remedies for work-related personal

3. His claims against Stolt are injuries, and states in paragraph 29 that "claims and disputes
federal and general maritime arising from this employment" are subject to arbitration in the
tort claim not subject to the Philippines. The arbitration provision is not by its language
arbitration agreement. limited to contract claims but covers all claims "arising from this
employment."
- EF alleged his injuries were sustained "in the course and
scope of his employment."
B. Marinechance Shipping, Ltd. v. Sebastian,
- The clause--providing that "any and all disputes or
controversies arising out of or by virtue of this Contract" shall
be litigated in the Philippines--applied to tort claims brought
by two Philippine seamen injured aboard a vessel while it was
located in the Mississippi River.
- The language of the forum selection clause in Marinechance
is not meaningfully different from the language of the
arbitration clause in the pending case for purposes of
deciding whether tort claims are covered, and note that
"foreign arbitration clauses are but a subset of foreign forum
selection clauses in general
Oral argument – a. Para 29 states that parties subject to a CBA shall submit the
An employee like himself who claim or dispute to arbitration, but that parties not subject to a
was not subject to a CBA is not CBA MAY submit the claim or dispute "to either the original
required to submit his claim to and exclusive jurisdiction of the" NLRC "or to the original and
arbitration in the Philippines. exclusive jurisdiction of the voluntary arbitrator or panel or
arbitrators."
- the only two options available to such an employee both
require arbitration
b. GR, recognized in a Convention Act case, that "whenever the
scope of an arbitration clause is in question, the court should
construe the clause in favor of arbitration,"