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London Steam-Ship Owners’ Mutual Insurance Association v The Kingdom of Spain & The French State

Monday 11th – Friday 15th October 2021

Appeal 1 – This is an appeal by the Defendant/Applicant appealing the order made by Mr Justice Butcher dated 31 July 2020 made in the Commercial Court.

The Judge held as follows: a) Spain was not immune from suit in relation to either the Award or Judgment Claims; b) The Court did not have jurisdiction to determine the Judgment Claim pursuant to Section 3 of Chapter II of Regulation (EU) No 1215/2012 (Brussels Recast); and c) The Court has jurisdiction to determine the Award Claim, applying the common law rules

The Applicant appeals against the order in the Award Claim on the grounds that: (a) Spain, as a sovereign state, is immune from the Club’s claims and (b) the Court does not have, or should not exercise jurisdiction over the Claim.

The Judgment dealt with four sets of proceedings, two against Spain and two against the Republic of France. The pairs of proceedings against each state were materially identical to those against the other. This appeal relates to the Awards Claim against Spain. The underlying dispute between the parties arose out of a severe marine pollution incident in 2002, when the MT PRESTIGE broke in two, discharging large quantities of oil and causing significant pollution to the shorelines of Spain and France. The incident led to criminal proceedings against the master, chief officer and chief engineer of the vessel. Pursuant to Article 116 of the Spanish Penal Code, those found guilty of criminal offences and their insurers are liable under Spanish Civil Law in respect of loss and damage caused by the event constituting the crime. Following the determination of liability by the Spanish Supreme Court, on 1 March 2019, the Provincial Court of A Corua handed down an order for EUR 855,493,575.65 in compensation to be paid by inter alia the Club to inter alia Spain. In parallel to the Spanish proceedings, the Club commenced arbitration proceedings before Alistair Schaff QC against Spain. The Club sought various declarations, premised on the allegation that Spain was bound by the arbitration agreement and pay to be paid clause in the insurance contract between the Club and the owners of the vessel, pursuant to the conditional benefit principle.

Appeal 2 – The Claimant/Appellant is appealing the Order of HHJ Butcher (sitting as a High Court Judge) dated 31st July 2020. Permission was granted to the Claimant to appeal paragraph 4 of HHJ Butcher’s Order in respect of the decision that on the assumption that the claims are relating to insurance within the protective regime in S3 of the Regulation (EU) No 1215/2012, the English court does not have jurisdiction in respect of the claim brought against the Spanish State (CL-2019-00578) under Art 14(2) in S3 of the Regulation.

Permission to appeal paragraph 4 in relation to the question of whether the Spanish Judgment Claim was a counterclaim within the meaning of Article 14(2) of the Recast Regulation was granted by the Court of Appeal.

Appeal 3 – The Defendant/Appellant is appealing the Order of Mr Justice Butcher dated 31st July 2020 that the Defendants have no immunity from suit from claims under S1 of the State Immunity Act 1976; and that the Court has territorial jurisdiction over the Defendants in respect of the Award Claims.

Lower Court Judgment:

https://www.bailii.org/ew/cases/EWHC/Comm/2020/1920.html

View hearing:

Day 1

Part 1

Part 2

Day 2

Part 1

Part 2

Day 3

Part 1

Part 2

Day 4

Part 1

Part 2

Day 5

Part 1

Part 2