Euronav Shipping NV v Black Swan Petroleum DMCC

An anti-anti-arbitration injunction should ordinarily be granted only where the applicant establishes to a high degree of probability that a binding arbitration agreement exists and has been breached, or where the foreign proceedings are sufficiently vexatious or oppressive. A mere serious issue to be tried is insufficient where the injunction would prevent a party litigating in a foreign court and create duplicative proceedings.

Even where the contractual route is established, relief remains discretionary. The court must give proper weight to comity, the risk of conflicting judgments, voluntary submission to the foreign court’s jurisdiction, and delay. Where those considerations are material, the appropriate course may be to adjourn the application pending the foreign appeal.

Euronav sought an anti-anti-arbitration injunction under section 37 of the Senior Courts Act 1981. It wished to restrain Black Swan Petroleum DMCC from pursuing an anti-arbitration application in the High Court of Malaysia and to protect London arbitration proceedings concerning cargo stored on Euronav’s vessel.

Euronav relied on a sub-bailment on the terms of a storage agreement, as amended by an allegedly binding Addendum No. 2 containing an LMAA arbitration clause. The Malaysian court had held that Euronav voluntarily submitted to its jurisdiction, and had restrained continuation of the London arbitration pending appeal. The central issues were whether the arbitration agreement was probably binding and breached, and whether an injunction should be granted in the court’s discretion.

1. Contractual route. The applicant had to establish to a high degree of probability that, at trial, it would prove the existence and breach of an arbitration agreement on the balance of probabilities. The American Cyanamid serious-issue test was inappropriate because the relief would materially affect the respondent’s ability to litigate in Malaysia and could produce duplicative proceedings and inconsistent judgments.
2. Euronav had shown a high probability that Addendum No. 2 became binding through the parties’ conduct. The unsigned document and the response acknowledging receipt were ambiguous, but the subsequent commercial correspondence, delivery of the cargo and absence of reservations supported acceptance.
3. Applying the principles in The Pioneer Container, a sub-bailee may rely on the terms of a sub-bailment against the head bailor only where the owner expressly or impliedly consented to, or apparently authorised, those terms. Euronav had shown a high probability that Black Swan knew or ought to have known of Euronav’s identity and contractual relationship with Silk Straits, and had accepted the risk of the governing terms by transferring possession without enquiry.
4. The Malaysian anti-arbitration application would otherwise constitute a breach of the LMAA arbitration agreement. The Malaysian procedural characterisation of the order did not alter that conclusion. Euronav’s possible waiver, repudiation or estoppel arising from voluntary submission had not been argued.
5. Discretion. Relief was refused at this stage because it would interfere improperly with comity, facilitate duplicative proceedings, and undermine the binding Malaysian finding that Euronav had submitted to that court’s jurisdiction. Euronav’s delay was also relevant. The application was adjourned, with liberty to restore after final determination of Euronav’s Malaysian appeal.

The judgment describes proceedings in the High Court of Malaysia, including an order refusing Euronav’s application for a stay or strike-out and a later anti-arbitration order restraining continuation of the London arbitration. Euronav’s appeals in Malaysia were pending. This court adjourned the English application pending final determination of the appeal concerning submission to the Malaysian jurisdiction.