U&M Mining Zambia Ltd v Konkola Copper Mines Plc

An anti-suit injunction is available where foreign proceedings breach an agreement to arbitrate, but the court must first establish the alleged breach. The seat of an arbitration is determined from the parties’ agreement. A contractual reference to arbitration “in London” and to England as its place ordinarily selects England as the seat unless clear evidence shows otherwise. The courts of the seat have supervisory and primary supportive functions, but they are not necessarily the exclusive forum for interim relief. Institutional arbitration rules may preserve a party’s right to seek urgent interim measures from another state court, particularly where that court is the natural and practical forum. Such proceedings are permissible provided they support, rather than undermine, the arbitration.

U&M Mining Zambia Ltd and Konkola Copper Mines Plc were parties to several Zambian-law contracts providing for LCIA arbitration in London. Following termination of a mining contract, KCM obtained an ex parte interim mandatory injunction from the High Court of Zambia requiring U&M to vacate a Zambian copper mine and hand over equipment. U&M commenced arbitration in London and obtained an English anti-suit injunction restraining KCM from pursuing the Zambian proceedings.

At the inter partes hearing, the issues were whether the arbitration seat under the principal contract was England or Zambia, and whether KCM was nevertheless entitled to seek interim protective measures from the Zambian courts.

1. Disposition. The Zambian proceedings were not a breach of the arbitration agreements. The English anti-suit injunction was discharged. It was unnecessary to determine KCM’s separate application for a stay under section 9 of the Arbitration Act 1996.
2. Seat. The FW/HW Contract provided for LCIA arbitration “in London” and stated that the place of arbitration was England. Applying Shashoua v Sharma [2009] 1 CLC 716, the contractual reference to “place” meant the legal place or seat. The parties’ selection of the High Court of Zambia for enforcement did not displace that conclusion. England was therefore the seat and English law the curial law.
3. Interim relief. A choice of seat gives the courts of that seat the sole supervisory and primary supportive function in relation to the arbitration, but it does not make them the exclusive forum for every application for interim relief. The Econet Wireless Ltd v Vee Networks Ltd [2006] EWHC 1568 (Comm) principle was accepted: another court may exceptionally be used where practical reasons make the application sensible there and the proceedings are not a disguised attempt to outflank the arbitration.
4. Contractual and institutional framework. Article 9 of the UNCITRAL Model Law and section 2(3) of the Arbitration Act 1996 recognise that interim measures may be sought from a court even where the arbitration seat is elsewhere. Article 25.3 of the LCIA Rules implicitly preserved the parties’ right to apply to a state court for interim or conservatory measures before formation of the tribunal, subject to the arbitration agreement.
5. The dispute concerned possession of a Zambian mine and equipment situated in Zambia. Pending constitution of the tribunal, Zambia was the natural and practical forum. The applications therefore supported, rather than contradicted or hindered, the arbitration.