Menu
Seeing double? Legal considerations for granting an “anti-anti-suit injunction”

Insights / / Seeing double? Legal considerations for granting an “anti-anti-suit injunction”

You can listen to this article in podcast format here:

Specialised Vessel Services Limited v. MOP Marine Nigeria Limited (SVS Cochrane) [2021] EWHC 333 (Comm)

In this case, the Claimant sought an injunction from the English Court to counter the injunction obtained by the Defendant in the Federal High Court of Nigeria, hence an “anti-anti-suit injunction”. The Commercial Court granted the injunction because: (i) the Defendant had breached the charter agreement to arbitrate in London by bringing proceedings in Nigeria; (ii) the Defendant had not suggested that the arbitration agreement was invalid; (iii) although the Claimant had delayed approximately a year before seeking injunctive relief in the English Court, much of that delay had been caused by the Nigerian Court process; (iv) the proceedings had not progressed at all substantively on the merits in Nigeria; and (v) the fact that the Nigerian Court had already issued an anti-suit injunction did not require the English Court to refuse to grant the relief sought on the ground of comity.

The background facts

In October 2019, the Claimant Owners’ vessel “SVS Cochrane” was involved in a collision with a tugboat in Nigerian waters whilst bareboat chartered to the Defendant. The Claimant had several claims arising from the collision, including but not limited to outstanding hire (US$ 1,209,137.50) and loss equivalent to the value of the vessel.

Although clause 30 of the bareboat charter provided for English law and LMAA arbitration,  the Defendant commenced two separate claims in the Nigerian Court on 22 November 2019 for: (i) negative declarations in relation to its liability under the bareboat charter; and (ii) an injunction preventing the Claimant from insisting on the payment of any outstanding hire. An additional motion was filed under the same suit seeking an injunction restraining the claimant from contacting the Defendant in relation to the payment of hire (the “Nigerian Proceedings”).

By the time the Claimant was able to instruct Nigerian lawyers, the 14 day period to respond had lapsed. Accordingly, the Claimant applied for an extension from the Nigerian Court, together with an application for a stay of the Nigerian proceedings on the basis that the proper forum for the dispute was arbitration in London.

Both parties’ application hearings were subject to adjournment and significant delay owing largely to court vacations, the Covid-19 pandemic and the lack of online hearings infrastructure.

In the meantime, the Claimant commenced arbitration in London. In response, the Defendant filed another claim in the Nigerian Court against the Claimant and the arbitrator. The Defendant then also sought and obtained an ex parte injunction from the Nigerian Court against the Claimant and the arbitrator restraining them from proceeding with the arbitration in London.

The Nigerian proceedings remained afoot with the next scheduled hearing fixed for 2 March 2021 (if not further adjourned). The Claimant maintained that their commencement by the Defendant was a clear breach of contract and that the obtaining of the injunction restraining it and the arbitrator from proceeding with the LMAA arbitration was itself a breach of contract that prevented the Claimant from exercising its contractual rights. It sought injunctive relief from the English Court. The application was heard on 18 February 2021.

The Commercial Court decision

The Court considered that it had the power to grant the Claimant an anti-anti suit injunction to counter the injunction obtained by the Defendant in Nigeria. The parties had agreed an exclusive English forum clause in the charter and a foreign anti-suit injunction to restrain substantive proceedings in England was a breach of the relevant clause and could be restrained by injunction on that basis.

The Court also found that the other usual legal considerations for granting injunctive relief were satisfied on the facts of this case.

Promptness

Applications for injunctive relief must be made promptly, both in the interests of fairness to the respondent and in the interests of comity toward the overseas court.

A failure to seek relief promptly can of itself be viewed as a strong reason not to grant injunctive relief.

In this case, the Court observed that whilst there had undoubtedly been delay in seeking the requested relief, much of that delay had been caused by the Nigerian court process itself. Once it became apparent that the process was becoming substantially delayed, the Claimant had sought relief from the English Court without undue delay.

Before foreign proceedings are too far advanced

The Court observed that whilst it was regrettable that a certain amount of the Nigerian Court’s time and resources had been taken up in dealing with this matter, this had only been to a limited degree. The only matter that the Claimant had asked the Nigerian Court to deal with was whether to set aside or stay the injunction granted to the Defendant and that issue had not yet been determined at first instance.

Comment

The fact of delay may not of itself be a bar to the obtaining of injunctive relief. The English Court has demonstrated that it will examine the cause of the delay in its decision-making process. If the delay has been caused by the applicant, then a far more unsympathetic view will likely be taken by the Court. Therefore, when seeking injunctive relief, the old adage still rings true: delay at your peril!

Eric Eyo

Eric Eyo Partner

Angela Song

Angela Song Associate

Related sectors:

Related news & insights

News / Court finds extra-contractual counterclaims fell within scope of arbitration agreement

02-08-2022 / Maritime

Sea Master Special Maritime Enterprise & another v. Arab Bank (Switzerland) Ltd (Sea Master) [2022] EWHC 1953 (Comm) This bill of lading dispute raised issues as to whether the Bank financing the purchase of a cargo, and the holder of a switch bill of lading for the cargo, was a party to the arbitration agreement incorporated into the switch bill and, if so, whether certain counterclaims brought by the Owners came within the scope of that arbitration agreement. The Court agreed with the tribunal’s findings that, once the Court had decided that the Bank was a party to the arbitration agreement, then the counterclaims for reasonable remuneration and quantum meruit came within the ambit of the arbitration agreement, being claims “arising out of or in connection” with the bill of lading contract.

Court finds extra-contractual counterclaims fell within scope of arbitration agreement

News / Party offered reasonably satisfactory security following collision obliged to accept it

20-07-2022 / Maritime

MV Pacific Pearl Co Ltd v. Osios David Shipping Inc (Panamax Alexander) [2022] EWCA Civ 798 The Court of Appeal has confirmed that a party to ASG 2, the standard form Collision Jurisdiction Agreement, is obliged to accept reasonable security once it is offered and cannot choose to refuse that security and seek alternative or better security by arresting a ship. In such circumstances, there is no right to an arrest or any justification for it.

Party offered reasonably satisfactory security following collision obliged to accept it

News / Rosita Lau, MH calls for China businesses to opt for Hong Kong arbitration in their contracts

15-07-2022 / Maritime

In an interview published this morning (14 July) in The Hong Kong Maritime Hub, Ince Partner Rosita Lau, MH calls for Chinese businesses to opt for Hong Kong arbitration in their contracts, initiative that requires attention of officials from the highest level.

Rosita Lau, MH calls for China businesses to opt for Hong Kong arbitration in their contracts

News / Court finds Covid-19 restrictions did not constitute force majeure under MOA

13-07-2022 / Maritime

NKD Maritime Limited v. Bart Maritime (No 2) Inc (Shagang Giant) [2022] EWHC 1615 (Comm) The Court has construed a force majeure clause and considered whether Buyers validly terminated a contract for the sale of a vessel on the basis that Covid-19 lockdown restrictions prevented Sellers from transferring title in the Vessel. 

Court finds Covid-19 restrictions did not constitute force majeure under MOA

News / Shipping gets smart

20-06-2022 / Maritime

On 25 November 2021, the UK Law Commission published its Advice to the UK Government on how English law currently applies to smart legal contracts. Subsequently, on 16 March 2022, the Law Commission published its report on electronic trade documents, together with draft legislation that would implement its recommendations to allow for the legal recognition of trade documents such as bills of lading and bills of exchange in electronic form.

Shipping gets smart

News / Carrier Under CMR Successful in Limiting Liability for Consignee’s Losses

14-06-2022 / Maritime

Paul Knapfield v. C.A.R.S. Ltd & others [2022] EWHC 1437 (Comm) Disputes under the Carriage of Goods by Road Act 1965, which incorporates the Convention on the Contract for the International Carriage of Goods by Road 1956 (CMR), do not come up very often. This decision is, therefore, useful in illustrating when and how the CMR applies. In this case, the Court found that the CMR limit of liability applied to the claimant’s claim, with the result that his losses far exceeded the amount he could ultimately recover from the carrier.

Carrier Under CMR Successful in Limiting Liability for Consignee’s Losses