Atlas Power Ltd & Ors v National Transmission and Despatch Company Ltd

Where an arbitration has its seat in England and Wales, the seat determines the curial law. The mandatory provisions of Part 1 of the Arbitration Act 1996, including the statutory challenges to jurisdiction and serious procedural irregularity, apply.

The choice of seat is analogous to an exclusive jurisdiction agreement. It ordinarily gives the courts at the seat exclusive supervisory jurisdiction over challenges to the award. A party cannot create concurrent supervisory jurisdictions by relying on the governing law of the underlying contract. Proceedings brought elsewhere in breach of that agreement may be restrained by anti-suit injunction.

The claimants, nine Pakistani independent power producers, and the defendant, a Pakistani national grid company, were parties to power purchase agreements providing for LCIA arbitration. The agreements were governed by Pakistani law and permitted arbitration in Lahore or, in specified circumstances, London.

The LCIA Court determined that London was the seat. The arbitrator subsequently confirmed that determination and issued a Partial Final Award. The defendant challenged the award in Lahore, Pakistan. The claimants sought a final anti-suit injunction restraining that challenge and any further challenge outside England and Wales.

The central issues were whether the courts of Pakistan retained concurrent supervisory jurisdiction and whether the seat was Lahore rather than London.

1. Final injunction granted. The defendant was permanently restrained from challenging the Partial Final Award in Lahore, Pakistan, or anywhere other than England and Wales.
2. Under section 2(1) of the Arbitration Act 1996, where the seat is in England and Wales, Part 1 applies. Section 4(1) and Schedule 1 make certain provisions mandatory, including sections 67 and 68 concerning challenges based on jurisdiction and serious procedural irregularity. The seat therefore determines the curial law of the arbitration.
3. The reasoning in C v D, including the Court of Appeal decision, established that the choice of seat is analogous to an exclusive jurisdiction clause. The parties must be taken to have agreed that remedies challenging the award are those permitted by the law of the seat. That conclusion does not depend on the law governing the underlying contract.
4. Allowing another jurisdiction to entertain challenges would create the risk of parallel proceedings and conflicting decisions. The defendant’s contention that Pakistani courts had concurrent supervisory jurisdiction was therefore rejected.
5. Section 3 of the Arbitration Act 1996 recognises designation of the seat by the parties, an institution or person authorised by them, or the tribunal where authorised. The LCIA Court and the arbitrator had determined that the seat was London. The defendant had not challenged those determinations under the Act. A challenge to jurisdiction or seat would not itself amount to acceptance that the seat was valid, but the defendant was bound by the unchallenged determinations.
6. The defendant could not resist the injunction by asserting that the seat was Lahore. Its proceedings in Pakistan breached the arbitration agreement, and no sufficient reason existed to withhold the injunction.