Judgment summaries

2022

Ebury Partners Belgium SA/NV v. Technical Touch BV and another (Jacobs J)

 E-commerce –-  incorporation of contractual terms via website – law governing incorporation of English law and jurisdiction clauses – anti-suit injunction

The Claimants applied for an anti-suit injunction to restrain proceedings in Belgium, and the Defendants applied to set aside service of English proceedings. The Second Defendant, on behalf of the First Defendant, had applied for foreign exchange facilities with the Claimants by making an on-line application. The Second Defendant ticked a box in the on-line form indicating the First Defendant’s assent to the Claimants’ standard terms, which included English law and jurisdiction clauses. However, the Defendants did not read the terms or download them, and they were not sent separately to the Defendants by the Claimants.

The court held that the on-line application form, which required an applicant to indicate its assent to the Claimants’ standard terms by ticking the box, was sufficient to give notice of those terms to the First Defendant. The Claimants’ standard terms were incorporated into the parties’ agreement, notwithstanding that the parties’ concluded agreement may not have been reached at the time when the box was ticked, but only some weeks later. The terms were incorporated applying English law principles, pursuant to Article 10 (1) of the Rome I regulation. It was not unreasonable to apply English law to that issue, and Article 10 (2) of Rome Iwas inapplicable. There were no strong grounds to permit the proceedings to continue in Belgium in breach of the parties’ agreement. An anti-suit injunction was granted.

The full judgment, [2022] EWHC 2927 (Comm), can be found on the National Archives website.

Contra Holdings Ltd v Mr M J C Bamford (Jacobs J)

Delays in fixing hearing of “consequentials” following judgment – Amendment of Statement of Case subsequent to judgment

In litigation between members of the Bamford family, the defendant successfully applied to strike out the claimant’s claim. Judgment was handed down on 18 July 2022 (see [2022] EWHC 1857 (Comm)). Due to the unavailability of counsel, the hearing of “consequential” matters arising from the judgment was delayed until 28 September 2022. The claimant then applied to amend its Statement of Case to allege fraud. The application was dismissed: the fraud allegation had no real prospect of success, there was no satisfactory reason for the claimant’s failure to make the application prior to or at the strike out hearing, and other discretionary factors favoured dismissal.

The court observed that an increasingly common, but regrettable, feature of Commercial Court litigation is the apparent difficulty in counsel making themselves available for a hearing of “consequential” matters, following the hand-down of a judgment. Delayed consequential hearings create an increased amount of work for the parties and the judge, who has to deal with a case weeks or (as here) over 2 months after judgment has been given, when the case is no longer fresh in his or her mind. They also, as in the present case, allow time for parties to re-think and try to salvage a case which has been lost, here by making a substantial application to amend. In the future, Commercial Court judges will be far less tolerant of “consequential” hearings being delayed because of the unavailability of counsel, and will fix “consequential” hearings to take place within a short time after judgment.

The consequentials judgment may be found on the National Archives website.

Judgment handed down on 18 July 2022 may be found here [2022] EWHC 1857 (Comm).

“Victor 1”, Ceto Shipping Corporation v Savory Shipping Inc (Andrew Baker J)

Bareboat charter – meaning of “management fees and any other sums due” to the ship’s technical and crew manager – whether ship could be arrested on a claim for technical and crew management fees – Senior Courts Act, s.20(2)(h)/(p)

The claimant bareboat charterer brought a Part 8 Claim against the defendant shipowner for a declaration that on the proper construction of the charter title to the ship passed to the claimant even if it owed management fees to the ship’s technical and crew manager, so long as the claimant was disputing the debt in good faith.  The relevant clause providing for title to pass required that the claimant should have “paid all hire and any other sums due under this Charter and … all management fees and any other sums due under the Management Agreement”.  A significant theme in the claimant’s argument was that the manager was protected, if the claimant’s construction of the charter was correct, by the ability to arrest the ship on a claim in rem for its fees after title had passed.  The court held that on the proper construction of the charter clause, ‘due meant due’, so that title did not pass if sums were owed to the manager.  The manager’s claim for technical and crew management fees was not within the Admiralty jurisdiction of the court allowing the ship to be arrested.

The full judgment, [2022] EWHC 2636 (Comm), may be found on the National Archives website.

Deutsche Bank AG (London Branch) v Central Bank of Venezuela (Cockerill J)

Permission to Appeal – Costs (Issue Based Order) – Interim Payment

The Court considered the authorities on the making of issue based costs orders, and made such an order where an issue was a marginal issue with a very high costs implication which need not have been taken, could have been pursued in a more streamlined fashion and where it was easier to separate the issue than determine an appropriate percentage figure for a reduction. The Court also granted permission to appeal exceptionally under the “some other compelling reason” gateway.

The full judgment [2022] EWHC 2702 (Comm) may be found on the National Archives website.

Pisante et al v Logothetis et al (No.2) (Andrew Baker J)

Restitution consequent upon rescission of contract – post-trial amendment application – costs and interest

The claimants’ claim that a shipping investment contract had been induced by fraud had succeeded at trial: [2022] EWHC 161 (Comm).  The contract was rescinded.  The consideration for the contract comprised two elements and the court had found that one element would have been invested with the defendants absent the fraud.  The claimants applied to amend to expand their damages claim to allege that the investment with the defendants absent the fraud would have been substantially profitable.

Held:

(i) The finding that the claimants would still have invested some of their money with the defendants was irrelevant to the question of restitution consequent upon rescission.  Rescission was total, not partial; restitution was to the status quo ante and also had to be total, not partial.

(ii) The new damages claim could and should have been put forward so as to be considered at trial, and it would be unjust to introduce it now.

The court also dealt with arguments about costs and interest.

The full judgment [2022] EWHC 2575 (Comm) may be found on the National Archives website.

Hulley Enterprises and Others v Russian Federation (Butcher J)

Application to lift stay of recognition and enforcement proceedings – ongoing set aside proceedings at the arbitral seat – jurisdictional challenge based on state immunity – balance of factors for and against continuation of stay 

The court partially lifted a stay of proceedings to enforce foreign arbitral awards (the “Awards”) solely for the purpose (and to the extent necessary) for the resolution of Russia’s state immunity challenge.  Russia, resisting enforcement proceedings brought under the Arbitration Act 1996 by the award creditors, had applied to dispute the English court’s jurisdiction on the basis of immunity under s.1(1) of the State Immunity Act 1978.  Russia had also brought set aside proceedings before the Dutch courts, the courts of the arbitral seat.  The court previously refused to lift the stay in April 2021 ([2021] EWHC 894 (Comm)).  However, matters had changed sufficiently since then, as: (1) the Dutch Supreme Court’s decision in November 2021 had resolved for the purposes of the Dutch proceedings those issues that would have overlapped with those raised on Russia’s state immunity challenge here; and (2) the effects of Russia’s invasion of Ukraine gave some further weight to the Claimants’ case that they would be prejudiced if the stay were to continue.  Whilst there remained before the Dutch courts an ongoing challenge to the Awards for procedural fraud in the arbitration, lifting the stay only to the extent necessary to resolve the state immunity challenge would not disrupt those proceedings or create an unjustified risk of inconsistent decisions.

The full judgment ([2022] EWHC 2690 (Comm)) can be found on the National Archives website (external link).

National Iranian Oil Company v (1) Crescent Petroleum Company International Limited (2) Crescent Gas Corporation Limited (Butcher J)

Arbitration Award – s.67 Arbitration Act 1996 – s.73 Arbitration Act 1996 – whether a party’s jurisdiction objection raised in the arbitration differed from one it sought to raise in its s. 67 application – summary dismissal of a s. 67 challenge – scope of arbitration agreement governed by foreign law

The court dismissed a s.67 Arbitration Act 1996 application brought by NIOC against an award rendered in favour of the second defendant (“CGC”).  NIOC’s s.67 application alleged that the tribunal lacked substantive jurisdiction to award damages in respect of NIOC having (by its breach of contract) caused CGC to incur liability to its subsidiary, Crescent National Gas Corporation Ltd (“CNGC”), under a separate CGC-CNGC contract.  NIOC argued that this was a claim falling outside the scope of the relevant arbitration agreement (which was governed by Iranian law).  The court made three principal rulings. 

First, NIOC’s s.67 application was not precluded by a failure to object which qualified for the purposes of s.73 of the Arbitration Act 1996.  Although in the arbitration, NIOC had not expressly articulated the scope objection (and had focused instead on how the disposition of the claim required an incidental finding that CGC was liable to CNGC under a different contract with its own arbitration agreement), NIOC had implicitly made the objection as a matter of substance. 

Second, NIOC was precluded from relying on Iranian law expert evidence insofar as it was inconsistent with the tribunal’s substantive findings (which had res judicata effect); but that this was not fatal to NIOC’s application on the facts. 

Third, assessed on its merits, NIOC had no realistic prospect of establishing that an arbitration agreement worded to cover any claim “arising out of or relating to the Contract” was to be construed, in accordance with such principles of construction of Iranian law as had been arguably shown to exist on this application, as not extending to a damages claim brought by CGC against NIOC for its having caused CGC to incur liability to CNGC by its breach of contract. The court granted summary judgment in favour of the defendants. 

The full judgment ([2022] EWHC 2641 (Comm)) can be found on the National Archives website (external link).

Various Eateries Trading Limited v Allianz Insurance PLC (Butcher J)

Business interruption insurance – Covid-19 – insured peril – indemnity period – proximate cause of loss in insurance – construction of limits of liability provisions – identification of ‘single occurrence’ for the purposes of aggregation clauses

The court interpreted provisions in a business interruption insurance policy, which were materially similar to those in Stonegate v MS Amlin ([2022] EWHC 2548 (Comm)) and Greggs v Zurich ([2022] EWHC 2545 (Comm)). A Covered Event (an occurrence of an insured peril) for the purposes of the ‘disease’ peril clause arose whenever a person contracted Covid-19 within the ‘Vicinity’ or entered the ‘Vicinity’ with Covid-19. Applying Stonegate, the number of Covered Events for the ‘enforced closure’ peril clause must be counted on a per Venue closed basis. For the ‘prevention of access’ peril clause, there occurred a Covered Event each time a materially different restriction which prevented access to insured Venues was imposed or advised, but no separate Covered Event arose for each affected Venue. The number of Covered Events must be identified by reference to the substance of the relevant actions or advice, not their form. The ‘Indemnity Period’ started with the commencement of business interruption caused by a Covered Event, rather than with a Covered Event. For the ‘disease’ peril clause, the court found that Covid-19 cases occurring before the insurance period ended had not been shown to be proximate causes of most governmental measures or decreases in custom after that period. The ‘prevention of access’ and ‘enforced closure’ peril clauses covered Covered Events starting within the insurance period and continuing beyond it. The ‘Limit of Liability’  per Single Business Interruption Loss applied to all claimed business interruption losses, irrespective of whether there was aggregation. On aggregation, the court, applying Stonegate, accepted Allianz’s position that certain government measures, such as restaurant closures and the second lockdown, were “single occurrence[s]” with which the claimed losses could have a sufficient nexus.

The full judgment, [2022] EWHC 2549 (Comm), can be found on the National Archives website (external link).

Stonegate Pub Company Limited v (1) Ms Amlin Corporate Member Limited (2) Liberty Mutual Insurance Europe SE (3) Zurich Insurance Plc (Butcher J)

Business interruption insurance – Covid-19 – insured peril – meaning of ‘occurrence’ in an aggregation clause – proximate cause of loss in insurance – guidance in the FCA Test Case – additional increase in cost of working cover – accounting for payments by third party reducing costs and diminishing insured loss

The court considered the correct interpretation of various insuring clauses in a business interruption insurance policy; specifically, the interpretation as to when each instance of an insured peril occurred under each of the ‘disease’, ‘enforced closure,’ and ‘prevention of access’ clauses.  For the purposes of the aggregation clause, the “single occurrences” with which the claimed losses might have a sufficient nexus which had been established were  (i) the Government’s decision on 16 March 2020 to advise people to avoid social venues and (ii) the Government’s instructions on 20 March 2020 for restaurants, pubs, and bars to close.  Regarding proximate cause, Covid-19 cases (which were insured perils) occurring within the insurance policy period were proximate causes of the lockdown continuing until July 2020 (thereby causing business loss), but not of governmental action or (with certain exceptions) changes in consumer behaviour after that date.  As for the interpretation of the Additional Increased Cost of Working (“AICW”) provisions, the AICW sub-limit provided for in the insurance policy applied per each Single Business Interruption Loss, and not in the aggregate. AICW and Increased Cost of Working (“ICW”) under the policy terms were mutually exclusive.  The AICW sub-limit was not available for increased costs and expenses having the effect of diminishing or avoiding losses in turnover, as those would be ICW.  Payments under the Coronavirus Job Retention Scheme and business rates relief received by the insured had to be accounted for under the savings clause (and the general law) as far as they diminished the insured loss.

The full judgment, [2022] EWHC 2548 (Comm), can be found on the National Archives website (external ink).

Greggs PLC v Zurich Insurance PLC (Butcher J)

Business interruption insurance – Covid-19 – insured peril – identification of ‘single occurrence’ for the purposes of aggregation clauses – interpretation of limit of liability clauses – accounting for third party payments diminishing insured loss.

The court considered the approach to be taken when determining the number of Covered Events (occurrence of insured perils) for the ‘prevention of access’ and ‘enforced closure’ perils in a business interruption insurance policy, applying the reasoning in Stonegate ([2022] EWHC 2548 (Comm)).  It could not be said that all of the Covid-19 cases (‘disease’ Covered Events), were to be regarded as causing a single business interruption loss to which a single Limit of £2.5 million applied.  For the purposes of the ‘aggregation’ clause, the court accepted that the Government’s COBR decision on 16 March 2020 was a ‘single occurrence’.  It was possible that losses arising from subsequent measures between 16-23 March 2020 (which were a progression of the 16 March decision), and losses arising from the insured’s decision to close its shops from 24 March 2020, were losses “in connection with” the COBR decision, and therefore aggregable.  The measures taken in each of the four nations after May 2020 were not a ‘single occurrence’ even if they were broadly to the same effect.  There were separate ‘occurrences’ in each nation when new restrictions were introduced, unless they merely continued existing restrictions (or made trivial changes).  Restrictions imposed on limited geographical areas also counted as separate ‘occurrences’.  The sub-limit on Public Relations Crisis Management costs applied per each Single Business Interruption Loss, in addition to the Limit of Liability.  Applying Stonegate, Coronavirus Job Retention Scheme payments and business rates relief were to be accounted for in assessing Greggs’ loss before applying the Single Business Interruption Loss limit. 

The full judgment, [2022] EWHC 2545 (Comm), may be found on the National Archives website (external link).

EGF v HVF et al (Andrew Baker J)

Arbitration – allegation of apparent bias by seeming to pre-judge an aspect of the merits (Arbitration Act 1996, s.24) – arbitrators’ power to require a payment on account as an interim remedy in respect of a money claim (UNCITRAL Rules, Articles 26 & 34, Arbitration Act 1996, ss.39 & 58)

In an arbitration seated in London and governed by the UNCITRAL Rules, HVF claimed c.US$400 million as a debt it said was owed by HVF under three related long-term supply contracts.  The arbitrators permitted HVF to rely on two extra witness statements served on the final day of a four-day merits hearing, in response to an allegation of dishonesty raised by EGF the previous day, without allowing for cross-examination on those statements (which would have necessitated an adjournment).  The court dismissed a claim that the arbitrators had thereby made it appeared that they might be pre-judging an issue going to the merits so as to create a justifiable doubt as to their impartiality.  The arbitrators issued a partial award requiring EGF to pay HVF US$250 million on account of HVF’s claim, by way of interim relief, subject to later adjustment or reconsideration.  The court dismissed challenges to that award under s.67 and s.68 of the 1996 Act.  EGF contended that the arbitrators had no power to order payment on account by way of interim relief, alternatively no power to issue an award for interim relief.  That challenge did not go the arbitrators’ substantive jurisdiction, so the s.67 claim failed.  The pleaded claim of substantial injustice was not made out, so the s.68 claim also failed.  Obiter, if substantial injustice had been shown, the s.68 claim would have succeeded:  Article 26 of the UNCITRAL Rules did confer power to order payment on account by way of interim relief; but Article 34 of the UNCITRAL Rules requires in unqualified terms that any relief granted by an award must be final, so the arbitrators exceeded their powers by granting interim relief in the form of a partial award.

The full judgment [2022] EWHC 2470 (Comm) may be found on the National Archives website (external link).

Pisante et al v Logothetis et al (No.2) (Andrew Baker J)

Restitution consequent upon rescission of contract – post-trial amendment application – costs and interest

The claimants’ claim that a shipping investment contract had been induced by fraud had succeeded at trial: [2022] EWHC 161 (Comm).  The contract was rescinded.  The consideration for the contract comprised two elements and the court had found that one element would have been invested with the defendants absent the fraud.  The claimants applied to amend to expand their damages claim to allege that the investment with the defendants absent the fraud would have been substantially profitable.

Held:

(i)            The finding that the claimants would still have invested some of their money with the defendants was irrelevant to the question of restitution consequent upon rescission.  Rescission was total, not partial; restitution was to the status quo ante and also had to be total, not partial.

(ii)           The new damages claim could and should have been put forward so as to be considered at trial, and it would be unjust to introduce it now.

The full judgment [2022] EWHC 2575 (Comm) may be found on the National Archives website (external link).

Banca Intesa Saopaolo SpA and Dexia Crediop SA v Comune di Venezia (Foxton J)

ISDA Master Agreement – whether void or entered into without authority – recoverability of amounts paid – whether claimants’ payments under hedging swaps gave rise to defence of change of position

On the basis of the decision of the Italian Supreme Court in the Cattolica case, Venice lacked the substantive power to enter into speculative derivatives or those which involved the payment of an “upfront”. That want of substantive power amounted to a lack of capacity for the purposes of English conflict of law rules, such that the Transactions were not binding on Venice. Venice’s alternative claim that the relevant officials lacked authority to enter into the Transactions, or that the Transactions were unenforceable for breaches of Italian mandatory laws, failed, as did its alternative claims for breach of duty. The Banks’ claims that Venice was estopped from denying that it lacked capacity to enter into the Transactions failed, as did their alternative claims in breach of contract and misrepresentation. Venice was entitled to recover the amounts paid under the Transactions in unjust enrichment. However, the unjust enrichment claims were governed by English law and it was open to the Banks to advance a defence of change of position. The payments made by the Banks under “back to back” hedging transactions amounted to a change of position (Westdeutsche Landesbank Girozentrale v Islington LBC [1994] 4 All ER 890 and South Tyneside MBC v Svenska International plc [1995]1 All ER 545 not followed).

The full judgment, [2022] EWHC 2586 (Comm), may be found on the National Archives website (external link).

NDK v HUO and KXF (No 2) (Foxton J)

Arbitration Award – s.67 Arbitration Act 1996 –whether a dispute as to the shareholder status of a party claiming to have acquired shares and who had signed a Deed of Accession to a Shareholders Agreement fell within the scope of the Arbitration Agreement in the Shareholders Agreement

A person claiming to have acquired shares in private company had executed a Deed of Accession in the required form agreeing to be bound by the terms of the Shareholders Agreement. There was a dispute as to whether there had been a valid transfer of shares to that party and as to whether it had become a registered shareholder of the company. The issue arose as to whether an arbitral tribunal appointed pursuant to the Arbitration Agreement in the Shareholders Agreement had jurisdiction to determine whether or not a valid transfer of shares had taken place.  Held: it was clear from the terms of the Deed of Accession read together with the Shareholders Agreement that it was intended to put persons proposing to acquire shares in the company and who had executed a Deed of Accession in the require form in contractual privity with the other shareholders for certain purposes, even if no valid transfer of the shares had in fact taken place.  The Arbitration Agreement formed part of the contract between the party who had executed the Deed of Accession and the other shareholders. Having regard to the terms of the Arbitration Agreement and the decision in Fiona Trust v Privalov [2007] UKHL40, the Arbitration Agreement so incorporated extended to a dispute as to whether or not there had been a valid transfer of shares to the party executing the Deed of Adherence.

The full judgment, [2022] EWHC 2580 (Comm), may be found on the National Archives website (external link).

Royal & Sun Alliance Insurance Limited and ors v Tughans (a firm) (Foxton J)

Professional indemnity insurance – transaction success fee – whether arbitrator had jurisdiction to award arbitral claimant a declaration relating to its liability to repay success fee or damages in the amount of the fee or whether granting the declaration involved a serious irregularity under s.68 of the Arbitration Act 1996 – whether as a matter of law the insurance policy responded to any liability the claimant might be found to have to return or pay damages in the amount of the success fee

The court should not adopted an overly strict interpretation of the scope of a particular submission to arbitration for the purposes of s.30(1)9c) of the Arbitration Act 1996, where the dispute fell within the scope of the parties’ arbitration agreement. In this case, while the arbitration claimant had informed the arbitration respondent that it would not be seeking a particular form of relief in the arbitration, the effect of that statement was not to deprive the arbitrator of jurisdiction to grant such relief, albeit the arbitration claimant required the arbitrator’s permission to depart from that concession, in circumstances in which considerations of justice and fairness to the other party might make it appropriate to refuse such consent. Accordingly the challenge under s.67 of the Arbitration Act 1996 failed. However, the granting a declaration which included the relief which the arbitration claimant had disclaimed its intention of seeking, without considering whether or not the arbitration claimant should be given permission to depart from the position it had adopted, involved a serious irregularity which has occasioned substantial prejudice to the arbitration respondent. For that reason, the challenge under s.68 of the Arbitration Act 1996 succeeded. So far the appeal under s.69 of the Arbitration Act 1996 is concerned, the arbitration claimant had accrued a contractual right to the Success Fee. In those circumstances, the arbitration claimant would suffer a loss for the purposes of the professional indemnity policy if ordered to pay damages in the amount of the Success Fee to a third party. If no contractual right to the Success Fee had ever accrued, then the obligation to return the fee would not have involved an indemnifiable loss for the purposes of the policy.

The full judgment, [2022] EWHC 2589 (Comm), may be found on the National Archives website (external link).

Deutsche Bank AG (London Branch) v Central Bank of Venezuela (Cockerill J)

Recognition of judgments – Act of state – One voice doctrine – Claims in rem – Natural Justice – Foreign governments and independence

On remission from the Supreme Court the Court found that certain judgments of the Venezuelan Courts purporting to nullify the executive acts of the individual recognised by the UK government as President of Venezuela were capable of being “quashing decisions”, but found that (i) they were not entitled to recognition as not meeting the criteria for recognition of in personam judgments and as not being the equivalent of judgments in rem which could be recognised and enforced by English courts (ii) if they had been capable of recognition there would have been defences to recognition as recognition would have been contrary to the “one voice” doctrine and the failings in natural justice in each case were serious clear breaches of natural and substantial justice and a denial of a fair trial under Article 6 of the ECHR and would render it inappropriate to recognise them.

The full judgment, [2022] EWHC 2040 (Comm), may be found on the National Archives website (external link).

NDK v HUO and KXF (Foxton J)

Arbitration Award – s.67 Arbitration Act 1996 -Whether arbitrators’ decision that court proceedings had been brought in breach of arbitration clause in a Shareholders Agreement (SHA) raised an issue as to the substantive jurisdiction of the tribunal for the purposes of s30(1) of the Arbitration Act 1996.

Where there was no dispute as to the existence of an arbitration agreement between the parties under which the tribunal had been appointed, but a dispute as to whether the arbitration agreement extended or was capable of applying to particular claims brought by one of the parties in court proceedings, the arbitrators’ decision as to the scope and applicability of the arbitration agreement when granting anti-suit relief raised an issue as to the tribunal’s substantive jurisdiction for the purposes of s.30(1) of the Arbitration Act 1996. Where the shareholders in a private company were required to be parties to the shareholders’ agreement, claims brought in court by one shareholder against another claiming relief by reference to the Articles of Association in respect of matters which also gave rise to breaches of the shareholders’ agreement fell within the arbitration agreement in the shareholders’ agreement (BTY v BUA [2018] SGHC 2013 and Dickson Holding Enterprise Company Limited v Moravia CV [2019] HKCFI 1424 not followed). The fact that the dispute involved an issue with implications for the accuracy or contents of a public register (in this case the register of members of a company) did not raise a sufficient public policy to override the strong public policy under English law of allowing commercial parties to refer their disputes to arbitration and holding them to their agreement to do so (dicta in BTY not followed).

The full judgment, [2022] EWHC 1682 (Comm), may be found on the National Archives website (external link).

The Ecu Group Plc v (1) HSBC Bank Plc (2) HSBC UK Bank Plc (3) HSBC Bank USA, N.A. and Therium Litigation Finance Atlas AFP IC (“Therium”) (Moulder J)

Defendants’ application for a non-party costs order against Therium, litigation funder. Whether Therium jointly and severally liable with the Claimant in respect of the Defendants’ costs, whether liability should be limited to costs incurred from the date of the litigation funding agreement, whether liability of Therium should be limited to its proportion of overall funding, whether Therium should receive credit for ATE insurance (and similar), whether Therium was liable for the outstanding amount of the interim payment.

The full judgment, [2022] EWHC 1616 (Comm) may be found on the National Archives website (external link).

Deutsche Bank AG v (1)  Sebastian Holdings, Inc and (2) Mr Alexander Vik (Moulder J)

Application of the Claimant for committal of the Second Defendant, Mr Alexander Vik. The Court found Mr Alexander Vik in contempt of court in that Mr Vik firstly deliberately gave false evidence in response to certain questions at a Part 71 means hearing on 11 December 2015 and secondly failed to produce documents as required by an order of the Court.

The full judgment, [2022] EWHC 1599 (Comm) may be found on the National Archives website (external link).

Bank of America Europe DAC v Citta Metropolitana di Milano (Foxton J)

CPR 15.11 – application to lift automatic stay – whether test for relief against sanctions to be applied – whether test satisfied – whether defendant should be given extension of time for lodging an acknowledgment of service to allow it to bring an out of time jurisdictional challenge

An application to lift the automatic stay imposed under CPR 15.11 was an application for relief against sanctions. It was appropriate to grant relief in this case – the claimants had deliberately allowed the actions to be stayed but had been seeking to address legitimate concerns arising from the equivocal nature of the defendant’s position, albeit by inappropriate procedural means. However, in circumstances in which it had suited both parties to avoid active participation in English proceedings for a long period pending developments in Italy, it was appropriate to grant the defendant an application for an extension of time within which to acknowledge service of the proceedings.

The full judgment, [2022] EWHC 1544 (Comm), may be found on the National Archives website (external link).

ARI v WXJ (Foxton J)

s.16(1) Arbitration Act 1996 – clause 30 of BARECON charterparty form requiring appointment of arbitrator to commence arbitration and requiring other party to appoint its own arbitrator within 14 days failing which the first appointed arbitrator could be designated sole arbitrator – whether defendant had validly appointed its arbitrator within 14 day period – test to be applied

Where an arbitration agreement governed by English law required a party to appoint its arbitrator to commence the arbitration, or provided that a party’s right to appoint an arbitrator would be lost if not exercised within a particular period, the test of whether there had been a valid appointment was to be approached pragmatically. All that was required was an unconditional confirmation of acceptance of the appointment by the arbitrator which was communicated to the other party, or an unconditional confirmation of the arbitrator’s willingness to accept appointment which the appointing party acted on by communicating the appointment to the arbitrator and the other party.

The full judgment, [2022] EWHC 1543 (Comm), may be found on the National Archives website (external link).

National Investment Bank Ltd v Eland International (Thailand) Co Ltd (Foxton J)

Arbitration Act 1996 – interrelationship between ss.18 and 72 – whether effect of order under s.18 to preclude application for declaration under s.72 – whether right to refer dispute to arbitration waived – effect of finding of non-arbitrability by foreign court and whether it gave rise to an issue estoppel

Where the applicant had not participated in the s.18 hearing, the court’s s.18 order did not have the effect of depriving the applicant of its entitlement to apply for relief under s.72. Here the applicant was entitled to a declaration under s.72 that the arbitration tribunal did not have jurisdiction on the basis that the respondents had waived the right to refer the dispute to arbitration by commencing proceedings in Ghana and/or their conduct in those proceedings. The decision of the Ghana court that the claims were not arbitral as a matter of Ghana law did not give rise to an issue estoppel, the issue of public policy being one for the courts of each country.

The full judgment, [2022] EWHC 1168 (Comm), may be found on the National Archives website (external link).

PJSC NBT v Mints and others (Foxton J)

Arbitration award – whether award gave rise to issue estoppel against non-arbitrating parties – test for privity when determining preclusive effect of prior arbitral award and generally – scope and application of “special circumstances” exception to doctrine of issue estoppel when prior determination in arbitration – application of doctrine of abuse of process against background of prior determination in an arbitration award – applications for permission to amend and summary judgment.

The arbitral award did not give rise to an issue estoppel against non-party defendants in subsequent Commercial Court proceedings. Nor was it an abuse of process for those defendants to advance arguments in the Commercial Court proceedings which were inconsistent with the findings of the arbitral tribunal. For that reason, application for permission to amend to plead a case of issue estoppel or abuse of process, and for summary judgment on the amended case, refused.

The full judgment, [2022] EWHC 871 (Comm) (external link) can be found on the National Archive.

Aquavita International SA v Indagro SA (Foxton J)

Anti-suit injunction – Arbitration Agreement – whether proceedings commenced in foreign court to obtain interim order which required mandatory performance of disputed contractual obligation a breach of the Arbitration Agreement – whether interim nature of foreign court’s order constituted “strong reason” for not granting an anti-suit injunction – relevance of availability of relief from English court under s.44 Arbitration Act 1996.

The court held that proceedings commenced in Brazil for an interim order which had the effect of requiring the final performance of a disputed contractual obligation constituted a breach of the arbitration agreement between the parties. Nor did the interim nature of the relief sought provide a “strong reason” for not granting anti-suit relief given the practical effect of the order. For that reason, the court renewed the anti-suit injunction granted by Fraser J on the “without notice” application.

The full judgment, [2022] EWHC 892 (Comm) (external link) can be found on the National Archive.

Invest Bank P.S.C. v Ahmad Mohammad El-Husseini Et Al. (Andrew Baker J)

Enforcement claims that assets are owned beneficially by the first defendant or have been the subject of transactions at an undervalue entered into by him (s.423 Insolvency Act 1986) – whether claims arguable – whether the court should set aside permission to serve out of the jurisdiction and/or refuse permission to amend and/or grant summary judgment against the claimant – whether steps taken by a company, acting by a controlling individual, constitute a transaction entered into by the individual.

Where an individual does no more than act as the instrument by which his company acts, the individual does not enter into a transaction with the company, or with the party with whom the company, thus acting by the individual, deals. On the claimant bank’s proposed pleading: no arguable s.423 claim was raised for most of the assets in respect of which that point had been taken, but there was an arguable s.423 claim in respect of a certain US$15 million cash balance; an arguable claim of beneficial ownership in the first defendant was raised, but limited to an allegation of express trust, in respect of two London properties, but not in respect of certain English company shares.

The full judgment, [2022] EWHC 894 (Comm) (external link) can be found on the National Archive.

Gulfvin Investment Ltd v Tahrir Petrochemicals Corporation S.A.E. et al. (Andrew Baker J)

Permission to serve proceedings out of the jurisdiction – whether England and Wales the most appropriate forum.

The claimant contracted to buy shares in Carbon Holdings Ltd (‘CHL’), the parent of the first defendant (‘TPC’), for US$5 million. It paid the price to a London bank account in TPC’s name as required by the contract but did not receive the promised shares. The claimant claimed damages for deceit against the second and third defendants (Mr El-Baz and Mr Garfinkel) and restitution on the ground of unjust enrichment against TPC. The defendants challenged jurisdiction (CPR Part 11). The restitution claim, if brought on its own, might most appropriately have been brought in this jurisdiction. The deceit claim, if brought on its own, should most appropriately be brought in Texas. The claimant’s position was that it was not appropriate to separate the claims. It had not been shown that this jurisdiction was clearly or distinctly the most appropriate forum for the trial of the action.

The full judgment, [2022] EWHC 1040 (Comm) (external link) can be found on the National Archive.

Unicredit Bank AG v Euronav NV (Moulder J)

Delivery of Cargo without production of bill of lading – Whether Owners liable to financing Bank for breach of contract- Status of bill of lading after the novation of the charterparty by the original shipper such that the Bill of Lading was no longer in the hands of the charterer but remained in the hands of the original shipper- Causation.

The court held that the Bill of Lading did not contain the contract of carriage between the Owners and the lawful holder of the Bill, BP, on or after the date of the novation and prior to the alleged misdelivery. Alternatively, any breach by the owners in discharging the Financed Cargo without production of the Bill of Lading did not cause the loss or in the alternative the Bank would have suffered the same loss in any event.

The full judgment, [2022] EWHC 957 (Comm) (external link) can be found on the National Archive.

Federal Republic of Nigeria v JP Morgan Chase (Cockerill J)

Banking – Quincecare duty – whether agreements were reached in fraud of the FRN – whether D was grossly negligent in making payments pursuant to those agreements – whether court precluded from considering the issue by the foreign act of state doctrine – title to sue – loss – causation – contributory negligence.

The court held that certain 2011 Resolution Agreements relating to a oil concession granted in controversial circumstances in 1998 were not concluded as part of a fraud on the FRN and consequently the Quincecare duty was not engaged. Had there been such a fraud the bank was not on notice of the fraud in 2011 and though on notice in 2013 was not grossly negligent. There would therefore have been no breach of the Quincecare duty (as modified by the contract) had there been a fraud. The court also concluded that it was not precluded from considering these issues by the foreign act of state doctrine, and that as a matter of Nigerian Law that the correct claimant had sued.

The full judgment, [2022] EWHC 1447 (Comm) (external link) can be found on the National Archive.

2021

PCP Capital Partners LLP v Barclays Bank Plc (Waksman J)

Fraudulent misrepresentation – causation and loss – standard of proof in respect of counterfactuals – Claimant unable to prove real and substantial chance of its obtaining necessary non-recourse debt finance to make out case on loss.

When the hypothetical actions of the defendant are in issue, the claimant must prove its case in relation to them on a balance of probabilities. By contrast, insofar as causation of loss depends on the actions of one or more third parties, the claimant must prove that there is a “real and substantial chance” of each third party taking the relevant action. This requires a threshold of more than 10%. On the facts, there was no real chance of the claimant obtaining the non-recourse debt finance necessary to achieve the remuneration that the claimant said would have been obtained, and the claimant would have been in effectively the same position in the counterfactual as it was in the real world.

The full judgment ([2021] EWHC 307 (Comm) (external link)) can be found on the National Archives.

Leeds City Council and Ors v Barclays Bank Plc (Cockerill J)

Misrepresentation – LIBOR manipulation – inducement involves requirement of awareness – assumption or subconscious operation on the mind of the representee insufficient in case of this kind.

As an element of a claim in misrepresentation, inducement involves some requirement of awareness. In some cases, the question will be what the claimant consciously thinks. In others it will be better expressed as whether the representation was actively present in the claimants’ mind. Prior authority on LIBOR and EURIBOR manipulation showed that in cases of this kind subconscious operation on the mind of the represented and/or assumption by the represented is insufficient. As pleaded, the claimants’ cases accordingly had no real prospect of success.

The full judgment ([2021] EWHC 363 (Comm) (external link)) can be found on the National Archive.

Tatneft v Gennady Bogolyubov & Ors (Moulder J)

Article 1064 of the Russian Civil Code – limitation – limitation defence under Russian law not contrary to English public policy despite limitation period running before claimant had knowledge of identity of defendants.

Despite the fact that the limitation period started to run as a matter of Russian law before the claimant had knowledge of the identity of the defendants, the limitation defence was not incompatible with English public policy. Ultimately, it is a matter for each legal system to strike a balance between the competing public and private interests that are engaged by the limitation of claims.

The full judgment ([2021] EWHC 411 (Comm) (external link)) can be found on the National Archive.

Hulley Enterprises Limited and Ors v The Russian Federation (Henshaw J)

Stay of recognition and enforcement proceedings should not be lifted while foreign challenge proceedings ongoing – prejudice to Claimants outweighed by considerations including comity, risk of inconsistent decisions, efficiency and the risk of unfairness if state immunity arguments made prior to findings of Dutch Supreme Court – exercise of powers under s.103(5) would constitute assertion of adjudicative jurisdiction which the Court had not yet held to exist.

Stay on recognition and enforcement of certain foreign arbitral awards should not be lifted while challenge proceedings were ongoing in Dutch Supreme Court. The prejudice to the claimants arising from further delay in potential enforcement measures was outweighed by the advantages of awaiting the ultimate outcome of the viable challenge in the Netherlands, namely: the advantage of allowing the process in the curial court to run its course in the interests of comity; the avoidance of inconsistent decisions, and the avoidance of the risk of prejudicing Russia’s case on state immunity. Court also did not have the power to require security under s.103(5) of the Arbitration Act 1996. The exercise of any powers under s.103(5) would constitute the assertion of an adjudicative jurisdiction over Russia which the court had not yet held to exist. There could be no question of exercising any such powers unless and until Russia’s claim to state immunity had been determined and rejected.

The full judgment ([2021] EWHC 894 (Comm)) can be found on the National Archive (external link).

London Steam-Ship Mutual Insurance Association Limited v The Kingdom of Spain (Butcher J)

Appeal against registration order of Spanish judgment – whether Article 34(1) of the Regulation meant that the Spanish judgment should not be recognised – procedure adopted by the Spanish courts did not involve a breach of human and fundamental rights.

For the purposes of Article 34(1) of Regulation (EC) No. 44/2001, where there is room for serious argument as to whether public policy is contravened then it is most improbable that it can be said enforcement is “manifestly” contrary to public policy. Article 14(5) of the ICCPR, an unincorporated treaty, does not represent a right recognised as fundamental within the English legal order such that it would be contrary to public policy to enforce any judgment based on a conviction rendered in contravention of its terms. Even if it were manifestly contrary to English public policy to recognise a criminal conviction which arose in contravention of the rights afforded to a defendant in criminal proceedings, the same would not apply to civil liability on an insurer such as that found by the Spanish Supreme Court. The fact that the Club could not be said to have availed itself of all the legal remedies available in Spain to prevent the relevant liability and complaints as to fair hearing rights had already been considered and rejected, including by the ECtHR, also weighed against refusal of recognition under Article 34(1). So too did the lack of a plain or obvious factual basis for certain of the fair hearing complaints and the fact it was doubtful that a different course of action would have made any significant difference.

The full judgment ([2021] EWHC 1247 (Comm) (external link)) can be found on the National Archive.

VTB Commodities Trading DAC v JSC Antipinsky Refinery & Ors (Cockerill J)

Court’s jurisdiction to permit Part 20 Claims in the context of a WFO obtained in Arbitration Claim – Claimant does not become Defendant for purposes of Part 20 by reason of third party’s claim in respect of cross-undertaking and directions to file Points of Defence – if jurisdiction exists, significant grounds for caution in granting Part 20 application in context of an Arbitration Claim.

In the context of a trial arising out of a Worldwide Freezing Order with a cross-undertaking granted and other orders made pursuant to an Arbitration Claim under s.44 of the Arbitration Act 1996, the court considered whether the arbitration claimant could join third parties by Part 20. The starting point is that the party claiming under the cross-undertaking should be seen as being in the position of the defendant. Here, this starting point was not displaced by the considerations that: the claim under the undertaking only arose if it transpired the injunction was wrongly granted; attack on the injunction involved resolution of an arguably separate substantive issue which could have been litigated in separate proceedings; the party claiming under the undertaking had sought to obtain early determination of the issues, and the directions in question required the claimant to provide Points of Defence. The court accordingly did not have jurisdiction under Part 20. The court also expressed considerable doubts as to whether there is any jurisdiction to add defendants to or permit Part 20 proceedings in respect of a Part 8 arbitration claim more generally. Any jurisdiction as does exist is one that should be exercised sparingly in light of the very limited role of the supervisory court. It would not have been appropriate to exercise that discretion here. Separately, England was not the forum conveniens due (inter alia) to language issues, the applicability of Russian law and the need for considerable and complex Russian law evidence.

The full judgment ([2021] EWHC 1758 (Comm)) can be found on the National Archive.

Province of Balochistan v Tethyan Copper Co Pty (Robin Knowles J)

Arbitration – jurisdiction – loss of right to object

The respondent to a US$4 billion ICC arbitration award was precluded from raising an allegation of corruption in a s67Arbitration Ac claim as they had failed to raise this before the ICC Tribunal and had done so through an informed choice. Any further right to challenge jurisdiction was barred by s73 Arbitration Act 1996. Further, in arguing that corruption had occurred, the claimant was seeking to impermissibly challenge the merits determinations of the ICC Tribunal.

The full judgment, [2021] EWHC 1884 (Comm) can be found on the National Archive.

Lakatamia v Su  (Bryan J)

Civil Fraud – judgment debt – unlawful means conspiracy and dissipation of assets in breach of a WFO – whether the court recognised the deliberate violation of the rights owed to a claimant in a judgment debt – Marex tort – adverse inferences in civil litigation. 

The court held that there had been a conspiracy to frustrate the claimant’s efforts to enforce a judgment debt by the dissipation of assets in breach of a WFO. The judgment confirms that English law recognises the tort of intentionally violating a claimant’s rights in a judgment debt (also known as a Marex tort) and outlines the adverse inferences which the court may draw from a defendant’s failure to provide adequate disclosure and to call material witnesses. 

The full judgment, [2021] EWHC 1907 (Comm) can be found on the National Archive.

Surkis & Others v Poroshenko & another (Calver J)

Reverse summary judgment – state immunity- foreign act of state doctrine – executive acts- waiver of immunity

Reverse summary judgment was granted on claims against the former president and former bank governor of Ukraine.  The claimants’ amended particulars of claim was struck out.  State immunity had not been waived by Ukraine.   All claims except the lawful means conspiracy claim were also barred by the foreign act of state doctrine and the claims had no real prospect of success.

The full judgment, [2021] EWHC 2512 (Comm) can be found on the National Archive (external link).