West Tankers Inc v. RAS Riunione Adriatica di Sicurta SpA & Ors

The principal legal issue was whether a national court of a Member State may grant an injunction restraining a person bound by an arbitration agreement from commencing or prosecuting proceedings in the courts of another Member State which have jurisdiction under EC Regulation 44/2001. The House concluded that the question was not obvious and therefore referred it to the Court of Justice under article 234. The opinion expressed by members of the House was that arbitration is expressly excluded from the Regulation by article 1(2)(d) and that proceedings to protect the contractual right to arbitration fall outside the Regulation. Accordingly, in their view an order to enforce an arbitration agreement by restraining litigation in another Member State would not be inconsistent with the Regulation. The court relied on the distinction drawn in Marc Rich (the "Atlantic Emperor") and Van Uden that proceedings whose subject-matter is arbitration are excluded, and contrasted arbitration agreements with exclusive jurisdiction clauses which fall within the Regulation (article 23).

This appeal arose from a collision between the chartered vessel Front Comor (owned by West Tankers Inc) and a jetty owned by Erg Petroli SpA. Erg pursued insurers for loss and commenced arbitration in London under a charterparty governed by English law containing an arbitration clause. The insurers (RAS and Generali) then sued West Tankers in the Tribunale di Siracusa under a statutory subrogation claim (Article 1916 Italian Civil Code). Under the Brussels regime the Italian courts had jurisdiction under article 5(3) subject to any stay under the New York Convention.

The respondents (West Tankers) sued in England seeking declarations that the insurers, standing in subrogation, were bound by the arbitration clause and an injunction restraining the insurers from continuing the proceedings in Syracuse. Colman J declared the insurers bound by the arbitration clause and, following the Court of Appeal authority in Through Transport, granted an anti-suit injunction. Colman J certified the case for direct appeal to the House of Lords under section 12 of the Administration of Justice Act 1969.

The House was asked to determine whether such injunctions are compatible with EC Regulation 44/2001 ("the Regulation"). The key issues framed were (i) whether arbitration and measures to protect the right to arbitrate fall outside the Regulation pursuant to article 1(2)(d); (ii) whether decisions of the Court of Justice in Gasser and Turner, which require mutual trust between courts under the Regulation, extend to prevent anti-suit injunctions in the arbitral context; and (iii) whether domestic powers (section 37(1) Supreme Court Act 1981; section 44 Arbitration Act 1996) to grant injunctive relief are incompatible with the Regulation.

The House concluded that the question required a reference to the Court of Justice. In their reasons the Law Lords expressed the view that arbitration is deliberately outside the Regulation's allocation of jurisdiction, that orders enforcing an agreement to arbitrate are therefore outside the Brussels allocation rules, and that extending Gasser and Turner to this context would be inappropriate. They observed the practical importance of the remedy to arbitration and the long-standing domestic practice of granting anti-suit injunctions, but nonetheless referred the question for authoritative EU interpretation.

Reference to the Court of Justice was made under article 234 because the House considered the answer not obvious. The Law Lords expressed the view that arbitration is excluded from Regulation 44/2001 by article 1(2)(d) and that orders enforcing arbitration agreements by restraining foreign court proceedings are not inconsistent with the Regulation, but they referred the definitive legal question to the Court of Justice for determination.

On appeal from the Commercial Court judgment of Colman J ([2005] EWHC 454 (Comm)). Colman J had granted declarations and an injunction; he certified the case for direct appeal to the House of Lords under section 12 of the Administration of Justice Act 1969.