Arbitration Law Monthly

The Arbitration Act 1996 defines “serious irregularity” justifying the setting aside of an award as including reaching a decision contrary to the agreement of the parties. China Property Development (Holdings) Ltd v Mandecly Ltd CACV 92 & 93/2015 is an illustration of an award for a claim that had never been made. The case is discussed by Edward Yang Liu, Associate, Reed Smith Richards Butler, Hong Kong.

ADM Asia-Pacific Trading Pte Ltd v PT Budi Semesta Satria [2016] EWHC 1427 (Comm), a decision of Phillips J, is a further illustration of the point that the court may refuse to grant an anti-suit injunction to a party who delays unnecessarily in seeking relief. That is the case even where there is a good tactical reason for the delay: international comity is a key consideration here.

The State Immunity Act 1978 confers immunity from the English courts upon a sovereign state. The most important exception is contained in section 9, which removes immunity where the issue relates to proceedings relating to an arbitration agreement. There is additional immunity under section 13 in respect of state property unless it is being used for “commercial purposes”. L R Avionics Technologies Ltd v The Federal Republic of Nigeria and Another [2016] EWHC 1761 (Comm), a decision of Males J, raised questions as to the proper interpretation of each of these provisions.

The question before Blair J in General National Maritime Transport Company v STX France SA [2016] EWHC 1187 (Comm) was whether a tribunal had been guilty of serious irregularity under sections 68(2)(a) and 68(2)(d) of the Arbitration Act 1996 (failure to adhere to natural justice and failure to deal with all of the issues) by allowing the respondent in the proceedings to provide only a redacted version of a contract that the tribunal had earlier directed should be produced.

Sections 40 to 42 of the Arbitration Act 1996 establish a procedure whereby orders made by the tribunal that are not adhered to can be enforced by court order. The tribunal may make an order and, if it is not complied with, the order may be made peremptory. Continuing failure to adhere to the order can then result in an application to the court for enforcement, carrying the additional sanction of contempt of court for non-compliance.

In HC Trading Malta Ltd v Tradeland Commodities SL [2016] EWHC 1279 (Comm) HHJ Waksman QC considered whether it was appropriate to grant a declaration confirming the existence of an arbitration clause. Unsurprisingly, the court ruled that a party who wished to ascertain whether there was a valid arbitration clause was required to submit that question to the arbitrators and not to the court.

In Gold Reserve Inc v Bolivarian Republic of Venezuela [2016] EWHC 153 (Comm) the claimant obtained an ICSID investment arbitration award and sought to enforce it in England. It is clear from the judgment of Teare J that where state immunity issues arise under the award, that should be disclosed to the court so that – where necessary – orders can be made to secure the retention of state immunity should the award be challenged on both that and other grounds.

Burton J in Exmek Pharmaceuticals SAC v Alkem Laboratories Ltd [2015] EWHC 3158 (Comm) was faced with a series of jurisdictional challenges to an arbitration award in which the arbitrator held that an arbitration agreement between the parties was valid. The most important was the existence of a judgment of the Peruvian courts holding that the right to rely upon the arbitration clause had been waived. There was a further raft of jurisdictional matters raised, including the validity of the clause, abandonment of the clause and the invalidity of the arbitrator’s appointment. As will be seen, each of the jurisdictional challenges was rejected.