‘WINGING’ IT ON ENFORCEMENT? SOUTH AFRICAN COURT LIFTS ATTACHMENT OVER TANZANIAN PLANE BECAUSE UNDERLYING AWARD ‘CEASED TO EXIST’

In a recent and controversial judgment, the High Court of South Africa set aside an attachment order authorising the attachment of an aircraft owned by the Tanzanian Government in satisfaction of a foreign arbitral award, on the ground that the award “ceased to exist” when it was converted into an order of the courts of the seat in Tanzania.

Twala J’s 4 September 2019 judgment in The Government of Tanzania v Steyn and Others sits uneasily with the strict mandatory enforcement regime for New York Convention awards introduced in South Africa’s revamped International Arbitration Act of 2017 (the “South African Act“). It also underlines the importance of clear drafting in any post-award settlement agreement to ensure that the parties retain the ability to enforce the terms of the original award in appropriate circumstances.

In this post, we examine the High Court’s reasoning and compare it with the approach that the English courts might take in similar circumstances under the Arbitration Act 1996 (the “English Act“). We conclude with some practical guidance for parties considering a post-award settlement.

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