Infrastructure Services Luxembourg SARL & Anor v The Kingdom of Spain

An appeal court may impose or vary a condition on permission to appeal under Civil Procedure Rules 1998, Part 52.18, after permission has been granted where the condition was not formally determined at the permission stage. A respondent’s statement identifying a possible condition under paragraph 19(1)(c) of Practice Direction 52C is not itself an application and does not bar a later application. A permission order is construed from its language and the submissions before the judge, not a later account of intended decision. The power may be exercised only where there is a compelling reason. Here, no compelling reason existed to require payment of the award into court as a condition of appeal.

Spain appealed from Fraser J’s decision of 24 May 2023 dismissing its application to set aside Cockerill J’s order registering an ICSID award as a High Court judgment under section 1(2) of Arbitration (International Investment Disputes) Act 1966. Males LJ granted permission to appeal on paper on 5 October 2023 without imposing conditions.

The Claimants then applied under CPR Part 52.18(1)(c) for a condition requiring Spain to pay the award into court. They relied on Spain’s Luxembourg proceedings, its position on state aid and the United Kingdom’s obligations under the ICSID Convention. Spain argued that the application was barred because the condition had already been considered or should have been challenged by reconsideration. The central issues were whether the court had jurisdiction to impose the condition and, if so, whether there was a compelling reason.

Application dismissed. The Court of Appeal held that it had jurisdiction under Part 52.18(1)(c) of the Civil Procedure Rules 1998 to impose a condition after permission to appeal had been granted.

1. No earlier determination. The Statement required by PD52C paragraph 19(1) was a short statement directed to permission, and paragraph 19(1)(c) required identification of possible conditions. It was not a formal application. Paragraph 19(3), which generally required no further step before permission was granted, did not remove the right to apply under Part 52.18. Males LJ’s order dealt only with permission. It had to be construed by its own words and the submissions before him, not by a later statement of intended meaning. Since the condition question had not been decided, the Claimants’ application was competent.
2. Compelling reason. Under Part 52.18(2), the power could be exercised only where there was a compelling reason. The words required no additional gloss. The court considered the evidence as a whole. The Claimants did not suggest that Spain lacked the means or intention to pay if it ultimately lost. Any practical concern arising from Spain’s Luxembourg proceedings was met by Spain’s undertaking to stay them until final determination, including by the UK Supreme Court. The undertaking was accepted and was to be recited in the order.
3. The state-aid issues, including article 108(3) of the Treaty on the Functioning of the European Union, were complex and partly overlapped with the appeal. Spain’s status as a sovereign state, its international-law position and the disputed question of existing security did not establish a compelling reason. No condition requiring payment of the award into court was imposed.

Sir Julian Flaux C and Snowden LJ agreed.

1. Court of Appeal (Civil Division) — The application to impose a condition on Spain’s permission to appeal was dismissed. Spain’s undertaking to stay the Luxembourg Proceedings until final determination of the appeal was accepted and ordered to be recited. The judgment is reported at [2024] EWCA Civ 52.
2. Court of Appeal, single judge — Males LJ granted Spain permission to appeal on paper on 5 October 2023 and imposed no condition.
3. High Court, Commercial Court — On 24 May 2023, Fraser J dismissed Spain’s application to set aside Cockerill J’s order registering the ICSID award as a High Court judgment. No citation for that decision was stated.