Verity Shipping SA ("Owners") & Anor v NVNorexa & Ors

An anti-suit injunction enforcing an arbitration agreement should ordinarily be sought promptly and before the foreign proceedings are substantially advanced. Delay is assessed by reference to the English court’s principles, even if the foreign court’s procedure permits a later jurisdiction challenge. A risk of inconsistent decisions may amount to strong cause or good reason to refuse relief where a third party is involved in related foreign proceedings and cannot participate in the contractual arbitration. The applicant’s willingness to bear the risk does not remove the potential injustice to that third party. A possible time-bar defence in the contractual forum will not itself justify refusing an injunction where the claimant cannot show that it acted reasonably in failing to preserve its contractual claim.

The claimants, owners and managers of a vessel, sought continuation of an ex parte anti-suit injunction restraining cargo interests from pursuing Antwerp proceedings concerning contaminated cargo. The bills of lading incorporated a charterparty containing an English law and London arbitration clause.

The claimants had also brought related recourse proceedings against a Belgian public body, FAVV, in Antwerp. They had participated in the Antwerp court-surveyor process and applied for the English injunction only in December 2007, nearly three years after the foreign proceedings began. The issues were whether there was strong cause or good reason not to enforce the arbitration agreement, including inconsistent decisions, delay, a possible time bar, and alleged non-disclosure on the ex parte application.

1. The anti-suit injunction was not continued. The court held that there was strong cause or good reason to refuse relief.
2. The risk of inconsistent decisions was material. The claimants’ recourse proceedings against FAVV in Antwerp could produce an inconsistent outcome with a London arbitration concerning the cargo claim. Although the claimants were willing to accept that risk, FAVV was not a party to the arbitration and could suffer injustice. If both claims proceeded in Antwerp, that risk would be avoided.
3. The application was substantially late. The claimants knew from January or February 2005 that the cargo interests were proceeding in Antwerp in breach of the arbitration clause, but waited until December 2007 to seek relief. Under The Angelic Grace and Toepfer v Molino Boschi, an applicant seeking an anti-suit injunction should act promptly and before the foreign proceedings are too far advanced. The fact that Belgian procedure allowed a later jurisdiction challenge did not justify delaying an application in England.
4. The Antwerp proceedings had made substantial progress. The court-surveyor process had investigated the material facts and produced an extensive report, with pleadings and a hearing still to follow. The court applied a common-sense assessment of the foreign proceedings as a whole.
5. The possible time-bar defence under Article III rule 6 of the Hague or Hague-Visby Rules did not provide strong cause or good reason. A claimant seeking to avoid a time bar in the contractual forum must show that it acted reasonably in failing to preserve its right there. The cargo interests had not obtained the charterparty, despite the bills of lading expressly incorporating it and its law and arbitration clause. They therefore could not establish reasonable conduct.
6. The court considered the non-disclosure complaint. The claimants had failed to provide full detail of their participation in the survey process and had inaccurately suggested that their jurisdictional objection had been made clear throughout. The omission was not materially misleading, and the inaccurate statement was not deliberate or necessary to the injunction application. Discharge on that ground alone was therefore refused.
7. Even if the delay analysis were wrong, the risk of inconsistent decisions and injustice to FAVV independently justified refusing continuation. The injunction was accordingly discharged by non-continuation.