Author: Syedur Rahman
11 January 2024
3 min read
Anti-suit injunctions are granted by the court to restrain legal proceedings that are commenced in breach of an arbitration agreement.
The English courts take a particularly pro-arbitration approach and see it as part of their supervisory role to uphold agreements between parties. That includes where the parties have agreed to arbitrate their disputes, rather than refer them to litigation in their local courts.
It is now well-established that an English court will ordinarily grant an injunction to hold the parties to that agreement.
In a recent application in the High Court, one party sought to resist the continuation of an ASI granted by the English courts. In this article we look at the reasons a party may put forward for resisting an ASI, and the court’s response to those arguments.
Mr Justice Butcher granted an application to continue the anti-suit injunction (ASI), which was first granted at a without notice hearing on 4 October 2023.
The reason RSM sought the ASI was to restrict proceedings with GdC had begun legal proceedings Cameroon. Through those proceedings, GdC froze around $18m of RSM’s funds in a without notice procedure.
RSM’s position was that the Cameroonian proceedings were brought in breach of an arbitration agreement contained in a settlement agreement between the parties.
The original ASI was granted on the basis that the arbitration clause in the settlement agreement was binding and that GdC was in breach of that clause for pursuing its claim in Cameroon.
GdC raised for grounds for resisting the continuation of the ASI.
In contractual cases like this one, the respondent may be successful if it can demonstrate that no relevant agreement exists between the parties.
GdC’s argument was that its claim in Cameroon is made under the terms of another contract, the joint operating agreement. These claims (it says) were not settled by the settlement agreement, which contains the arbitration clause.
Mr Justice Butcher accepted that it would not have been a breach of the arbitration provision under the settlement agreement, if GdC had commenced arbitration under the joint operating agreement. But GdC did not do that.
However, supporting the rejection of this argument was the language of consolidation between the joint operating agreement and the settlement agreement. Under those terms, disputes could be consolidated in a single arbitration.
The judge was satisfied that the arbitration provision under the settlement agreement was binding on GdC and applicable to its substantive claims made before the Cameroonian courts.
GdC contended that the Cameroonian proceedings were not in breach of any arbitration provisions because they were only intended to provide security for a claim which would be pursued in ICC arbitration.
The problem with that argument was that GdC had not commenced any arbitration.
The second strand of their argument was that, whatever the position when the proceedings began, GdC now made it clear that the Cameroonian Proceedings were only intended to provide security or an interim attachment measure, from this point forward. GdC intended to stay the substantive Cameroonian proceedings, so there was no justification for continuing the injunction.
However, the judge considered that there was insufficient assurance that the Cameroonian proceedings will not be pursued, and dismissed the argument.
Another argument put forward by GdC is a common one in for disputes involving international parties: the English court has no jurisdiction over it.
However, jurisdiction is determined by whether a respondent can be validly served with English proceedings. In the settlement agreement, the parties agreed that service of ‘any claim form, notice or other document upon GdC for the purpose of any proceedings or disputes begun in England and/or Wales shall be duly served upon it’ if delivered to GdC’s parent, Victoria Oil & Gas plc’s stated address.
GdC was validly served, pursuant to a contractually agreed method of service within Civil Procedure Rule 6.11. The English court therefore has jurisdiction of GdC in respect of the claim in the arbitration claim form.
At an ex parte hearing, the applicant must give fair representation of what the other side might have said if it were present. Any failure to make full and frank disclosure may be grounds to discharge an injunction.
GdC said that RSM should have informed the judge who granted the ASI that, on one interpretation, the order had the effect of preventing GdC commencing an ICC arbitration. But GdC had had the opportunity to commence such an arbitration, and it had not done so. The facts of the matter did not support the contention.
Dismissing each of the grounds, Mr Justice Butcher continued the ASI and made a mandatory order to discontinue the substantive Cameroonian proceedings. In doing so, he said that the outcome gives proper effect to the contractual position, and protects the parties against any risk of an adverse judgment in Cameroon.
This is another decision in a recent line of case-law in which the English court has intervened to restrict foreign proceedings. Other recent decisions (in slightly different circumstances) include SQD v QYP  EWHC 2145 (Comm) and a suite of applications brought against RusChemAlliance to restrict proceedings brought in Russia (see the applications from Deutsche Bank , Commerzbank and Unicredit)
Syedur Rahman is known for his in-depth experience of serious fraud, white-collar crime and serious crime cases, as well as his expertise in worldwide asset tracing and recovery, international arbitration, civil recovery, cryptocurrency and high-stakes commercial disputes.