Grace Ocean Private Ltd v MV "Bulk Poland"

An anti-suit injunction will ordinarily be granted where, to a high degree of probability, the applicant establishes an enforceable English arbitration agreement and foreign proceedings breach it. The respondent must then show strong reasons against relief. Relevant considerations include delay, the extent to which the foreign proceedings have advanced, and voluntary submission to the foreign court. A jurisdictional challenge is not voluntary submission. The court’s discretion is exercised in accordance with the parties’ contractual commitment to arbitrate, and comity does not ordinarily outweigh that commitment.

The claimant, owner and contractual carrier of the MV “Bulk Poland”, sought continuation of an interim anti-suit injunction restraining the defendant cargo receiver from pursuing Chinese proceedings concerning alleged cargo damage. The defendant had commenced those proceedings in the Qingdao Maritime Court despite bills of lading incorporating a voyage charterparty providing for English law and London arbitration.

The interim order had been granted by Cockerill J after an ex parte hearing. The defendant received notice of the return hearing but did not attend. The central issues were whether the arbitration agreement governed the dispute, whether the defendant had voluntarily submitted to the Chinese court, and whether any strong reasons justified refusing the injunction.

1. The interim order was continued. The defendant had been properly notified but did not attend. The return-date hearing therefore proceeded in its absence.
2. The claimant had to establish the arbitration agreement to a high degree of probability. Once that threshold was met, the defendant had to show strong reasons why an injunction should not be granted. The court also had to exercise its discretion on the evidence before it.
3. Under arts 3(1), 3(5) and 10 of the Rome I Regulation, the bills incorporated the voyage charterparty’s express choice of English law. Applying English law, the incorporation wording also incorporated the London arbitration clause. Article 10(2) did not apply because it was reasonable, and consistent with international trade expectations, to assess incorporation by reference to the law specified in the charterparty.
4. The defendant, as lawful holder and receiver, was bound to arbitrate substantive cargo claims under the bills. Commencing the Chinese proceedings was therefore a clear breach. Damages were not an adequate remedy.
5. There were no strong reasons against relief. The proceedings were not too far advanced, the application was made promptly, and neither the claimant’s jurisdictional challenge in China nor its appeal constituted voluntary submission. Section 33(1)(a) of the Civil Jurisdiction and Judgments Act 1982 was relevant to that conclusion.
6. The injunction was granted under section 37(1) of the Senior Courts Act 1981. The order retained a customary cross-undertaking in damages and was fortified by a £50,000 Club letter of undertaking. The claimant’s undertaking not to rely on the apparent time bar remained available if the defendant promptly withdrew the Chinese proceedings and commenced London arbitration by 11 December 2020.