Noble Assurance Company & Anor v Gerling-Konzern General Insurance Company (UK Branch)

An anti-suit injunction may be granted where foreign proceedings amount to a collateral attack on a binding English arbitration award and are oppressive, vexatious, unconscionable or an abuse of process. The court must remain cautious because of comity and must ask whether relief is necessary to protect a legitimate interest in English proceedings. A party that could have raised rescission, misrepresentation or non-disclosure as defences in the arbitration cannot ordinarily reserve those matters and later rely on them to undermine the award in another forum. Declaratory relief may be preferable to an injunction where it sufficiently clarifies the award and supports reliance on res judicata or collateral estoppel.

Noble and Shell sought continuation of a temporary injunction restraining Gerling from pursuing proceedings in Vermont. The Vermont action sought rescission of a reinsurance contract, declarations concerning a certificate policy and related relief, on the premise that the arbitration tribunal had found coverage for OPL only because of the certificate policy.

The parties had previously arbitrated whether the Gerling contract covered OPL. The tribunal awarded Noble the unpaid balance of Gerling’s layer. The central issues were the proper interpretation of that award, whether Gerling’s Vermont claims constituted an impermissible collateral attack, and whether relief should take injunctive or declaratory form.

1. Construction of the award. The tribunal had held that OPL was covered under endorsement 18 of the Gerling Contract independently of the certificate policy, and also that the certificate policy provided an alternative basis of coverage. Gerling’s Vermont claims were founded on the contrary interpretation.
2. Jurisdiction. The court had jurisdiction to grant an anti-suit injunction. Gerling was amenable to the English jurisdiction, and the injunction was sought to protect Noble’s and Shell’s interests in English arbitration proceedings. A collateral attack on a binding arbitration award may be oppressive even though the award has already been issued.
3. Abuse and unconscionability. Gerling’s claims were vexatious, oppressive, unconscionable and an abuse of process. Gerling had reserved the possibility of pleading misrepresentation and non-disclosure in the arbitration, but had elected not to advance those matters and had instead told the tribunal that it was not running such a case. It could not later seek to nullify the award on that foundation.
4. Relief. The court considered the need for caution and comity, the advanced stage of the Vermont proceedings and the possibility that declaratory relief would assist the Vermont court. A declaration concerning the scope and validity of the award could provide a foundation for res judicata and collateral estoppel. On balance, the ends of justice were sufficiently served by declaratory rather than injunctive relief.

The judgment records that a temporary injunction had been granted on 9 November 2006. The present application sought its continuation. The court instead granted relief in declaratory form.