A&N Seaways and Projects PVT Limited v Allianz Bulk Carriers DMCC

A challenge to an arbitration award under section 72 of the Arbitration Act 1996 is unavailable where the alleged non-party has engaged with the arbitral process. Seeking an extension of time to provide submissions is participation, even if accompanied by a jurisdictional reservation.

An amendment introducing a fresh ground after the statutory 28-day period will generally be refused unless exceptional circumstances justify departure from the policy of speed and finality. Fraud must be pleaded clearly and supported by primary facts making dishonesty more likely than innocence or negligence. A claim may be struck out where it is inadequately particularised or has no real prospect of success.

The claimant charterer challenged an award arising from a time charterparty for the vessel MV “Bharadwaj”. The arbitration found that the charterparty was valid, that the claimant was liable for unpaid hire and bunkers, and that the claimant had affirmed the agreement.

The claimant sought to amend its challenge to plead fraud and collusion. The respondent applied to strike out the claim, arguing that the claimant had taken part in the arbitration and that the challenge had no real prospect of success. The issues were whether the amendment was out of time and viable, whether the claimant had taken part in the arbitration within section 72, and whether the pleaded challenge could proceed.

1. Amendment refused. The proposed fraud allegations were introduced approximately five months after the claim form and well outside the 28-day period in section 70(3) of the Arbitration Act 1996. The principles governing extensions of time to challenge awards applied equally to a late amendment under section 72. The relevant considerations included the length and explanation of the delay, responsibility for it, prejudice, the strength of the challenge and fairness. The length of delay, its reasonableness and responsibility for it were primary factors.
2. The claim form issued within the statutory period had to be a complete and particularised statement of the case. The claimant could not use later evidence or amendment applications to introduce a new ground of challenge. No adequate explanation was given for failing to plead fraud at the outset, although substantially the same allegations had already been advanced in the arbitration.
3. The proposed pleading did not disclose an arguable case of fraud. The primary facts were more consistent with honest commercial conduct than dishonesty. Failure to request a board resolution, use of the company stamp and company email addresses, performance of the charterparty, payments by a related entity and the respondent’s conduct concerning the vessel did not justify an inference of fraud.
4. Participation in the arbitration. A party must elect whether to reject the arbitral process entirely or engage with it. The claimant’s request for an extension of time to prepare and submit submissions or an application acknowledged and engaged with the arbitral process. It therefore took part in the proceedings within section 72, notwithstanding its jurisdictional reservations.
5. Strike-out. The unamended claim was inadequately particularised and had no real prospect of success. The tribunal was entitled to find that the director had at least apparent authority, having regard to the company stamp, company communications, his directorship and the surrounding conduct. In any event, the claimant’s subsequent conduct objectively affirmed the charterparty. The amendment application was dismissed, the claim was struck out, and the claimant was ordered to pay the respondent’s costs on the indemnity basis.

Not an appeal. The judgment determined applications arising from a challenge to an arbitration award dated 9 July 2024.