AFRICA FINANCE CORPORATION & Ors v AITEO EASTERN E & P COMPANY LIMITED

An anti-suit injunction will ordinarily be granted for a clear breach of an arbitration agreement unless strong reasons justify refusal. Delay is relevant, but promptness is not an end in itself. The court must assess the delay objectively, including its explanation, prejudice, wasted expenditure, the progress of the foreign proceedings, comity and the importance of upholding the arbitration agreement. Commercial negotiations may reasonably explain substantial delay where the foreign proceedings have not progressed on their merits. A notice of appeal challenging an injunction on the basis of an arbitration agreement is not necessarily a step in proceedings which waives the right to arbitrate. An ex parte injunction should be set aside only where unfair presentation is sufficiently material and grave.

The Lenders financed the Borrower under two facility agreements containing London-seated ICC arbitration clauses. The Borrower commenced proceedings in the Nigerian Federal High Court seeking declarations of non-liability and obtained an ex parte injunction restraining enforcement action.

The Lenders appealed in Nigeria, conducted restructuring negotiations and later commenced arbitrations and these English proceedings. Cockerill J granted an interim anti-suit injunction. The Borrower applied to set it aside, while the Lenders sought final anti-suit and declaratory relief. The central issues were whether the arbitration agreements had been breached or waived, whether delay constituted a strong reason to refuse relief, and whether the ex parte order had been unfairly obtained.

1. Arbitration agreements and waiver. The Nigerian proceedings breached the Onshore arbitration agreement, and their continuation breached the Offshore arbitration agreement. Under Nigerian law, a step for the purposes of section 5 of the Arbitration and Conciliation Act is a step furthering the defence and demonstrating an intention that the merits be decided in court. The Lenders’ notice of appeal, which relied on the arbitration agreement, did not meet that description. Nor did the First Claimant’s preliminary objection to jurisdiction. There was therefore no waiver. The arbitral tribunal’s finding that the Offshore arbitration had been validly commenced and that there was no waiver was binding unless set aside under section 67 of the Arbitration Act 1996.
2. Delay. Following Ecobank Transnational Inc v Tanoh [2016] 1 WLR 2231, an applicant should act with appropriate despatch. Delay may engage prejudice, waste, finality and comity, but it does not automatically bar relief. The explanation must be assessed objectively. The 13-month delay was reasonably explained by negotiations intended to restructure the facilities, assist the Borrower and end the Nigerian proceedings. Those proceedings had been frozen and had not advanced the merits, so granting relief would not waste the Nigerian court’s work or resources. The importance of enforcing the arbitration agreements strongly supported relief.
3. The possible contempt of the Nigerian order and the November 2019 sworn assurances did not constitute strong reasons for refusing relief. The possibility of contempt was relevant but carried limited weight on the evidence. The time taken to obtain advice, decide to proceed and prepare the application was not unreasonable.
4. Ex parte relief. The court considered the alleged failures of disclosure and presentation. Materiality is for the court to determine, as explained in General Dynamics v Libya [2022] EWHC 501 (Comm). The treatment of contempt and service by email was imperfect, but any unfairness was not sufficiently grave to justify setting aside the order. Proceeding ex parte was justified by the risk that notice would prompt further injunctive relief in Nigeria.
5. The Lenders were entitled to a final anti-suit injunction and the requested declaratory relief.