SAYED S. SANGAMNEHERI v THE CHARTERED INSTITUTE OF ARBITRATORS & ORS.

Allegations that an earlier judgment was obtained by fraud require a real case of conscious and deliberate dishonesty, material to the earlier decision and causative of its terms. A discrepancy in recording a date, without facts supporting dishonest knowledge or belief, is insufficient.

Where a foreign seat is chosen, the Arbitration Act 1996 applies only to the limited extent provided by the Act. Even if sections 16 and 18 applied, section 18 concerns steps needed to constitute an arbitral tribunal; it does not invalidate an existing appointment or transfer the arbitration to the court.

Repeated attempts to relitigate decided matters, or matters which should previously have been raised, may be struck out as res judicata or an abuse of process. An extended civil restraint order is appropriate where claims or applications are persistently totally without merit.

The claimant brought Part 8 and Part 7 claims against the Chartered Institute of Arbitrators, its president, employees and an arbitrator arising from an arbitration concerning a land-and-gold exchange contract. He alleged that the date of receipt of his request for arbitration had been falsely substituted, that the arbitrator was appointed outside the period in section 16(3) of the Arbitration Act 1996, that the arbitration was therefore void, and that evidence had been fraudulently concealed in earlier litigation.

The defendants applied to strike out the claims under CPR 3.4(2), alternatively for summary judgment under CPR 24.2. The claimant sought default judgment, a declaration that the arbitration was void, and joinder of Weightmans LLP and Mr Gaul. The central issues were whether the earlier judgments could be set aside for fraud, whether the new claims were barred or abusive, and whether an extended civil restraint order should be made.

1. Disposition. The Part 7 and Part 8 claims, the default-judgment application, the application for a declaration that the arbitration was void, and the joinder application were dismissed or struck out as totally without merit. Summary judgment was also available. An extended civil restraint order was made, and the judgment was referred to the Attorney General.
2. Fraud and setting aside earlier judgments. The principles in Royal Bank of Scotland plc v Highland Financial Partners lp, approved in Takhar v Gracefield Developments Ltd, require conscious and deliberate dishonesty, material evidence or conduct, and a causal connection with the earlier judgment. The alleged date discrepancy did not support an inference of dishonesty. The evidence was not material because the earlier court would have reached the same decision. The earlier judgments therefore remained binding.
3. Arbitration procedure. Section 16(3) of the Arbitration Act 1996 was subject to section 16(1), and the parties had agreed to CIArb rules. The foreign seat also limited the application of the Act under sections 2(3) and 2(4). In any event, section 18 provides machinery for making or completing appointments; it does not make an existing appointment void or allow the court to take over the arbitration. The minor delay was inconsequential and did not deprive the tribunal of jurisdiction.
4. Res judicata and abuse. Applying Henderson v Henderson and Johnson v Gore Wood, the claims concerned matters already determined or matters which should have been raised earlier. The repeated litigation constituted unjust harassment and misuse of finite court resources. The claims against individual employees could not circumvent prior rulings that CIArb was not liable, absent a properly pleaded individual case of dishonesty.
5. Restraint order. Applying Sartipy v Tigris Industries Inc, the claimant had persistently issued claims and applications which were totally without merit, including repeated attempts to relitigate the same issues. The statutory and Practice Direction criteria for an extended civil restraint order were satisfied.