Intermet FZCO & Ors v Ansol Ltd & Ors

An anti-suit injunction is granted only where the ends of justice require it. The court exercises the jurisdiction cautiously because an order indirectly affects a foreign court or tribunal. Relief may be justified where foreign proceedings are vexatious or oppressive, or breach an exclusive jurisdiction or arbitration agreement.

Delay is a material consideration, particularly where the foreign proceedings are well advanced. Parallel proceedings do not automatically justify restraint. Where the proceedings concern distinct contractual and fraud issues, and suitable undertakings prevent expansion of the arbitration, continuation of the arbitration may be neither oppressive nor unconscionable. The parties’ contractual right to arbitrate should ordinarily be respected.

Ansol applied for an interim injunction restraining Intermet FZCO and Vneshexpertservice Consulting Company Limited from continuing arbitration proceedings in Zurich. The arbitration concerned contractual claims under a General Agreement, including claims relating to repayment of debt and the provision of security.

Intermet and Ves were also pursuing Commercial Court proceedings involving alleged fraud, conspiracy, deceit, breach of trust and related remedies. The proceedings arose from the same factual background and involved some overlapping evidence, but the court proceedings involved parties who were not parties to the arbitration.

The central issue was whether the overlap, duplication, risk of inconsistent findings and alleged prejudice made continuation of the arbitration oppressive, vexatious or unconscionable, so that an injunction should be granted.

1. The application was dismissed. The court held that the ends of justice did not require an injunction. Continuation of the arbitration was not oppressive, vexatious, severely prejudicial or unconscionable.
2. The jurisdiction to restrain foreign proceedings is discretionary and must be exercised cautiously. It is directed against the party pursuing the foreign proceedings, not against the foreign court or tribunal. Where a valid arbitration agreement exists, the court should ordinarily hold the parties to it, subject to exceptional circumstances.
3. Ansol’s application was made too late. Ansol had known of the arbitration, had challenged jurisdiction, participated in fixing the hearing timetable and only later sought a stay. The court treated that delay, together with the advanced state of the arbitration, as a significant reason for refusing relief.
4. The arbitration claims were contractual claims concerning the alleged breach of the General Agreement and the adequacy of the promised security. They did not depend on findings of fraudulent misrepresentation, conspiracy, inducement of breach or forgery. The Commercial Court proceedings could therefore determine the wider fraud issues while the arbitration determined the less complex contractual issues.
5. Although it would be convenient for one tribunal to determine all issues, that result could not realistically be achieved because the other defendants were not parties to the arbitration. Preventing the arbitration would deprive Intermet and Ves of their contractual and procedural advantages, including potentially quicker enforcement and substantial expenditure already incurred.
6. Undertakings given by Intermet and Ves not to pursue fraud-based claims or evidence in the arbitration sufficiently separated the issues. The court saw no real risk of inconsistent findings because issue estoppel would prevent the claimants from re-litigating issues determined adversely against them.