ENGLISH COURT GRANTS ANTI-SUIT INJUNCTION ORDERING THE DEFENDANT TO DISCONTINUE ITS CLAIM IN A NEW YORK COURT UNDER A D&O INSURANCE POLICY

In a recent case, the English High Court (the Court) granted XL Insurance Company (XL) a final anti-suit injunction restraining Peter Little (PL) from pursuing litigation proceedings against XL in the District Court of the Southern District of New York (the New York proceedings), on the basis that PL was bound by the arbitration agreement mandating London-seated arbitration in the directors’ and officers’ (D&O) insurance policy (the Policy) issued by XL to PL’s former employer, Barclays PLC (Barclays).

While this decision does not advance the law in this area, it highlights a key advantage of choosing London as the arbitral seat, particularly in sectors where claims are likely to be brought by parties who had not themselves entered into the arbitration agreement. Continue reading

ENGLISH HIGH COURT GRANTS INJUNCTION TO BLOCK JORDANIAN PROCEEDINGS SEEKING TO INVALIDATE AN ARBITRATION AGREEMENT

On 1 March 2019 the English court granted the claimant, ACT, a permanent anti-suit injunction against proceedings issued in  Jordan (the Jordanian Proceedings) by the defendant, Soletanche (in Aqaba Container Terminal (PVT) Co v Soletanche Bachy France SAS). The Court found that the subject matter of the Jordanian proceedings fell within the scope of an arbitration clause agreed between ACT and Soletanche. Soletanche had relied in the validity of that arbitration clause in earlier ICC proceedings to claim damages from ACT (albeit unsuccessfully). It was therefore just in all the circumstances to issue an anti-suit injunction to prevent breach by Soletanche of the agreement to arbitrate and to halt its efforts to invalidate that agreement through the Jordanian Proceedings.

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HONG KONG COURT GRANTS ANTI-SUIT INJUNCTION TO BIND THIRD PARTY TO ARBITRATION AGREEMENT

In Dickson Valora Group (Holdings) Co Ltd v Fan Ji Qian [2019] HKCFI 482, the Hong Kong Court of First Instance has granted an anti-suit injunction restraining mainland Chinese court proceedings commenced by Fan Ji Qian on the ground that the dispute should be referred to arbitration. Although Fan was not a signatory to the contract containing the arbitration clause, he had nevertheless sought to enforce a contractual right under that agreement, such that he was also bound by any conditions integral to the exercise of this right (including the agreement to arbitrate).

This decision shows that an arbitration agreement can, in certain circumstances, bind third parties. This is something which should be considered when drafting agreements which purport to confer a benefit on non-signatories, particularly if it is intended that third parties exercising rights under the contract should also be bound by the arbitration provisions.

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Absence of a bilateral or multilateral treaty for enforcement of judgments between UK and Lebanon leads to English Court issuing anti-suit injunction in favour of arbitration

In the case of Perkins Engines Company Limited v Mohammed Samih Hussein Ghaddar & Ghaddar Machinery Co. S.A.L [2018] EWHC 1500 (Comm) the English Court was asked to issue an anti-suit injunction against court proceedings brought in Lebanon. The relevant dispute resolution clause between the parties provided for English court jurisdiction to the extent that “reciprocal enforcement procedures” exist between the United Kingdom and Lebanon, failing which, disputes were to be submitted to arbitration. The Court found that the ordinary and natural meaning of the words required the existence of a multilateral/ bilateral treaty facilitating reciprocal enforcement of judgments in the United Kingdom and Lebanon. Since no such treaty existed, an anti-suit injunction should be granted against the Respondents in respect of proceedings they had brought in Lebanon.

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West Tankers principle unaffected by Recast Brussels Regulation; mandatory foreign jurisdictional rules do not encroach on scope of widely worded arbitration clause

In Nori Holdings Limited et al v PJSC Bank Okritie Financial Corporation [2018] EWHC 1343 (Comm) the English court has applied the Recast Brussels Regulation, finding that the West Tankers principle remains applicable and, as a consequence, refused to grant an anti-suit injunction in relation to parallel EU court proceedings.

At the same time, it found alleged Russian mandatory jurisdictional rules referring an insolvency dispute to the Moscow Arbitrazh Court insufficient to displace the wide and general wording of an arbitration clause, with the result that it granted an anti-suit injunction in relation to non-EU proceedings. Continue reading

English High Court grants an anti-suit injunction and confirms that the choice of arbitral seat is “analogous to an exclusive jurisdiction clause”

In Atlas Power v National Transmission and Despatch Company Ltd [2018] EWHC 1052 the English High Court granted a final anti-suit injunction to permanently restrain a national grid company owned by the Government of Pakistan (“NTDC“) from challenging an LCIA Partial Final Award in Pakistan (or anywhere other than England and Wales).

The injunction was granted on the “entirely straightforward” basis that the seat of the arbitration was London.  Phillips J rejected NTDC’s arguments that the courts of Pakistan had concurrent jurisdiction or that the seat of the arbitration was Lahore, Pakistan, and confirmed that an agreement on the seat of the arbitration is also an agreement on the forum for any challenges to an award.  Continue reading

The English Court of Appeal substitutes one anti-suit injunction for another (more limited one)

The English Court of Appeal is the latest court to weigh in on this long-running dispute spanning multiple jurisdictions between Messrs Emmott and Wilson, relating to an agreement to establish a “quasi-partnership”. Following an appeal brought by Mr Emmott against the High Court’s decision (which we reported here), the question for the Court of Appeal was whether to uphold the anti-suit injunction granted by the High Court preventing Michael Wilson & Partners, Limited (“MWP”) from pursuing proceedings in the Australian courts in light of the London-seated arbitration agreement between them.

The Court of Appeal allowed the appeal in part, issuing a substitute injunction against MWP advancing only the claims which the court deemed to be vexatious and oppressive in undermining the arbitration agreement and process.  This judgment helpfully clarifies the circumstances in which the English Court will issue an anti-suit injunction in order to safeguard the integrity of an English-seated arbitral process, and confirms that the court will not permit arbitral proceedings or awards to be undermined by parties against whom adverse findings have been made. However, it also demonstrates that the question of whether proceedings fall within the scope of an arbitration agreement can be a complex and controversial one.

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Hong Kong Courts grant anti-suit injunctions to restrain foreign proceedings in breach of an arbitration agreement

In Arjowiggins HKK2 Ltd v Shandong Chenming Paper Holdings Ltd [2018] HKCFI 93, the Hong Kong Court of First Instance has granted an anti-suit injunction in favour of a recipient of a Hong Kong arbitral award to restrain the continuation of the overseas proceedings by the losing party. The Court held that such proceedings were essentially commenced to re-litigate the same matters that had already been decided in a previous arbitration and ultimately to avoid honouring the arbitral award.

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The English High Court extends an anti-suit injunction against proceedings brought in breach of an arbitration agreement

In the latest chapter of a long-running dispute (John Forster Emmott v Michael Wilson & Partners [2016] EWHC 3010 (Comm)), different aspects of which have been considered by various jurisdictions around the world for over ten years, the English High Court has continued an anti-suit injunction preventing proceedings in New South Wales on the basis that such proceedings were brought in breach of an arbitration agreement.

This is a welcome reminder that the English courts will take active steps to uphold party agreements to submit their disputes to arbitration and prevent parties from seeking to either side-step arbitration agreements or to re-litigate issues which have already been decided in a different forum.

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English Court reiterates warning not to delay application for anti-suit injunction, regardless of jurisdictional challenge in the foreign proceedings

In ADM Asia-Pacific Trading PTE Ltd v PT Budi Semesta Satria [2016] EWHC 1427, the English Commercial Court rejected an application for an anti-suit injunction on the basis of undue delay.

This decision mirrors the Court's approach in Ecobank v Tanoh and Essar v Bank of China, which we previously covered here and here. It also reiterates that the Court's discretion to reject an application for an anti-suit injunction is not limited to instances where the delay is unconscionable or has caused prejudice to the respondent.

The judgment confirms, once again, that parties facing foreign proceedings commenced in breach of an arbitration agreement should bring an anti-suit injunction application as soon as possible after receiving notice of the foreign proceedings, regardless of any jurisdictional challenge in the foreign proceedings.

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