In SQD v QYP  EWHC 2145 (Comm), the English Commercial Court refused to issue an anti-suit injunction (ASI) and anti-enforcement injunction to stop proceedings commenced by a claimant in its home country in breach of an arbitration agreement. The court reasoned that such an injunction would be inconsistent with the French courts’ approach to ASIs and the parties’ choice of Paris as the seat of arbitration. Continue reading
Tag: English Commercial Court
In Radisson Hotels APS Denmark v Hayat Otel Işletmeciliği Turizm Yatırım Ve Ticaret Anonim Şirketi  EWHC 892 (Comm) the Commercial Court has rejected an application made by Radisson Hotels APS (Radisson) to set aside, on the grounds of serious irregularity, a partial arbitral award relating to a hotel mismanagement claim brought by Hayat Otel Işletmeciliği Turizm Yatırım Ve Ticaret Anonim Şirketi (Hayat).
The Commercial Court has rejected an attempt to challenge an LCIA award on grounds of serious irregularity under section 68(2)(a) of the Arbitration Act 1996: Livian GmbH v Elektra Ltd and another  EWHC 757 (Comm). The Court held that the contention that the Tribunal had overlooked undisputed witness testimony could not form the basis of an allegation of serious irregularity and, in any event, the Claimant had failed to demonstrate that evidence was overlooked or that any alleged omission would have had a significant impact on the outcome.
This judgment is another example of the robustness of the English Courts when faced with challenges to arbitral awards and their continued deference to tribunal decision-making. Continue reading
In Africa Finance Corp and others v Aiteo Eastern E&P Company Ltd  EWHC 768 (Comm), the English Commercial Court ruled that a 13 month delay in seeking an anti-suit injunction was not unreasonable given that the parties were engaged in negotiations during that period and the foreign proceedings in Nigeria had not advanced to a significant extent (in part due to the coronavirus pandemic). Although parties should continue to seek anti-suit injunctions as promptly as possible, this decision shows that courts are willing to show a degree of flexibility in determining whether delays are reasonable and therefore whether an anti-suit injunction should be granted.
In DHL Project & Chartering Ltd v Gemini Ocean Shipping Co., Ltd  EWHC 181 (Comm), the Commercial Court has set aside an arbitral award under s67 of the Arbitration Act 1996 (the “Act“) on the basis that the arbitral tribunal lacked substantive jurisdiction.
The case concerned a “subjects” provision which required “shipper/receiver’s approval“. The Court found that:
- the “subjects” provision was a pre-condition to the effectiveness of both the contract and the arbitration agreement contained within it;
- as “shipper/receiver’s approval” was not in fact obtained, the “subjects” provision was not satisfied, and so neither the contract nor the arbitration agreement became binding on the parties; and
- the arbitrator therefore had no jurisdiction to decide the dispute, and the Award was set aside.
In the recent decision in LLC Agronefteprodukt v Ameropa AG  EWHC 3473 (Comm), the English Commercial Court (the ‘Court’) dismissed a jurisdictional challenge under section 67 of the Arbitration Act 1996 (the ‘Act’), finding that a single Notice of Arbitration validly commenced separate arbitration proceedings. The decision is of particular interest given that the Court reached a different outcome from the earlier decision of A v B  EWHC 3417 (Comm) (blog post available here), in which the Court upheld a section 67 challenge in similar circumstances.
The Underlying Contracts and Disputes
Under two separate contracts of sale (the ‘Contracts‘), LLC Agronefteprodukt (the ‘Sellers‘) agreed to sell quantities of Russian Milling Wheat to Ameropa AG (the ‘Buyers‘). The Contracts both contained an arbitration clause which provided for arbitration under the GAFTA rules, seated in London.
The Buyers commenced arbitration in August 2018 under both Contracts in a single Notice of Arbitration (the ‘Notice‘). This Notice included a paragraph (the ‘Final Paragraph‘) which read “On a separate note, [the Buyer wondered] if, for efficiency and economy, [the Sellers] would accept the two contracts/disputes be adjudicated under a single arbitration and by the same Tribunal“. The Sellers did not respond, and an arbitrator for the Sellers was appointed by GAFTA.
In September 2018, the parties entered into negotiations and concluded an agreement (the ‘Washout Agreement’) under which the Sellers would pay a sum to the Buyers (the ‘Settlement Sum‘) to terminate the claim. The Sellers failed to make payment, and the Buyers continued the arbitration.
The Underlying Awards and S67 Challenge
The Sellers contended that the Tribunal lacked jurisdiction on the basis that the Buyers had failed to validly commence arbitration proceedings under each contract. They argued that the Notice was invalid as it illegitimately purported to commence a single arbitration in respect of claims under separate Contracts. Under the GAFTA Rules, the Sellers would have to consent to any such consolidation, which they did not. This jurisdictional challenge was rejected by the First Tier GAFTA Tribunal and the Appeal Board in their awards (the ‘First Tier Tribunal Award‘ and ‘Appeal Board Award‘ respectively).
The Sellers proceeded to challenge both the First Tier Tribunal Award and the Appeal Board Award under section 67 of the Act (the ‘Section 67 Challenge‘).
In Sabbagh v Khoury and others,  EWCA Civ 1219 (available here), the English Court of Appeal partly upheld the injunction granted by the Commercial Court restraining the pursuit of arbitration proceedings seated in Lebanon. In doing so, the Court of Appeal confirmed the power of English courts to restrain a foreign arbitration on grounds that the foreign arbitration is oppressive and vexatious and provided helpful guidance on the exceptional circumstances in which English courts may exercise this power.
The English Commercial court has overturned an arbitral award under section 67 of the English Arbitration Act 1996, finding that an arbitral tribunal lacked substantive jurisdiction because the respondent company in the arbitration had been dissolved by the time the notice of arbitration was filed (in GA-Hyun Chung v Silver Dry Bulk Co Ltd  EWHC 1147 (Comm)).
In a rare example of a successful challenge under s68 of the Arbitration Act 1996 (the Act), in K v A  EWHC 1118 (Comm), the English Court held that there was a serious irregularity when the GAFTA Board of Appeal (the Tribunal) found K liable based on an interpretation of a clause in the contract which had not been argued by A. The Court concluded that the Board may have reached a different view if K had had an opportunity to address the argument, and remitted the Award back to the Tribunal. The application for leave to appeal under s69 of the Act was rejected as the Court found that there was no error of law in the Tribunal’s finding that the payment obligation on K was to make payment into A’s account, not just to A’s bank.
The case arose following the hacking of the intermediary broker’s (V‘s) email accounts. Whilst A had provided the correct account details to V, the details provided to K (purportedly by V but actually by the fraudster), resulted in the payment of the contract price into the fraudster’s account. After discovery of the fraud, a payment shortfall arose out of complications in the eventual payment of the purchase price to A. A sought to recover the shortfall in the arbitration.
The case shows the importance of understanding where the risk passes under a contract for fraud or hacking of the type which can interfere with performance by the parties of their contractual obligations.
In The Chartered Institute of Arbitrators v B, C, D  EWHC 460 (Comm), the Commercial Court granted an application made by the Chartered Institute of Arbitrators (the CIArb) under CPR 5.4C for permission to obtain copies of certain court records, to be produced in disciplinary proceedings against a CIArb member. The Court found that the public interest in ensuring CIArb members meet their professional standards outweighed the confidential nature of the arbitration, and allowed the disclosure of certain documents which were on the court’s records and which had originally been produced during an arbitral hearing.