Arbitration mini series Wednesday 19 May at
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Arbitration mini series Wednesday 19 May at 12.30pm, Session 2: Arbitration and the Courts: orders in support and the impact of insolvency proceedings chaired by Helen Davies QC Jacob Rabinowitz - Orders to secure the attendance of
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01
Arbitration mini series Wednesday 19 May at 12.30pm, Session 2:
Arbitration and the Courts: orders in support and the impact of insolvency proceedings
chaired by Helen Davies QC
Jacob Rabinowitz - Orders to secure the attendance of witnesses and document production
Simon Salzedo QC - Injunctions in support of arbitration
Harry Matovu QC - Arbitration and insolvency: a battle for precedence brickcourt.co.uk
+44(0)20 7379 3550<br>
Arbitration and the Courts: orders in support and the impact of insolvency proceedings
chaired by Helen Davies QC
Jacob Rabinowitz - Orders to secure the attendance of witnesses and document production
Simon Salzedo QC - Injunctions in support of arbitration
Harry Matovu QC - Arbitration and insolvency: a battle for precedence brickcourt.co.uk
+44(0)20 7379 3550<br>
02
ORDERS TO SECURE THE ATTENDANCE OF WITNESSES, FOR THE TAKING OF WITNESS EVIDENCE, AND FOR DOCUMENT PRODUCTION brickcourt.co.uk
+44(0)20 7379 3550 Jacob Rabinowitz<br>
+44(0)20 7379 3550 Jacob Rabinowitz<br>
03
brickcourt.co.uk
+44(0)20 7379 3550 Orders for the attendance of witnesses 43 Securing the attendance of witnesses.
A party to arbitral proceedings may use the same court procedures as are available in relation to legal proceedings to secure the attendance before the tribunal of a witness in order to give oral testimony or to produce documents or other material evidence.
This may only be done with the permission of the tribunal or the agreement of the other parties.
The court procedures may only be used if— (a) the witness is in the United Kingdom, and (b) the arbitral proceedings are being conducted in England and Wales or, as the case may be, Northern Ireland.
A person shall not be compelled by virtue of this section to produce any document or other material evidence which he could not be compelled to produce in legal proceedings.
2(3) (Scope of application of provisions): The powers conferred by [sections 43 and 44] apply even if the seat of the arbitration is outside England and Wales or Northern Ireland or no seat has been designated or determined… but the court may refuse to exercise any such power if, in the opinion of the court, the fact that the seat of the arbitration is outside England and Wales or Northern Ireland… makes it inappropriate to do so.<br>
+44(0)20 7379 3550 Orders for the attendance of witnesses 43 Securing the attendance of witnesses.
A party to arbitral proceedings may use the same court procedures as are available in relation to legal proceedings to secure the attendance before the tribunal of a witness in order to give oral testimony or to produce documents or other material evidence.
This may only be done with the permission of the tribunal or the agreement of the other parties.
The court procedures may only be used if— (a) the witness is in the United Kingdom, and (b) the arbitral proceedings are being conducted in England and Wales or, as the case may be, Northern Ireland.
A person shall not be compelled by virtue of this section to produce any document or other material evidence which he could not be compelled to produce in legal proceedings.
2(3) (Scope of application of provisions): The powers conferred by [sections 43 and 44] apply even if the seat of the arbitration is outside England and Wales or Northern Ireland or no seat has been designated or determined… but the court may refuse to exercise any such power if, in the opinion of the court, the fact that the seat of the arbitration is outside England and Wales or Northern Ireland… makes it inappropriate to do so.<br>
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brickcourt.co.uk
+44(0)20 7379 3550 Orders for the attendance of witnesses AVAILABILITY:
Domestic or foreign seat: s. 2(3).
Domestic venue: s. 43(3)(b). But see A and B v C, D and E [2020] EWHC 258 (Comm), paras. 29-30 (obiter): discrete hearings and video evidence.
Domestic witness: s. 43(3)(a).
Permission or consent: s.43(2).
DISCRETION: Attendance of witness should be “desirable for justice to be done”; see England and Wales Cricket Board Limited v Kaneria [2013] EWHC 1074 (Comm).
TYPE OF ORDER: Witness summons under CPR Part 34.
PROCEDURE FOR SEEKING ORDER: Application under CPR Part 34.<br>
+44(0)20 7379 3550 Orders for the attendance of witnesses AVAILABILITY:
Domestic or foreign seat: s. 2(3).
Domestic venue: s. 43(3)(b). But see A and B v C, D and E [2020] EWHC 258 (Comm), paras. 29-30 (obiter): discrete hearings and video evidence.
Domestic witness: s. 43(3)(a).
Permission or consent: s.43(2).
DISCRETION: Attendance of witness should be “desirable for justice to be done”; see England and Wales Cricket Board Limited v Kaneria [2013] EWHC 1074 (Comm).
TYPE OF ORDER: Witness summons under CPR Part 34.
PROCEDURE FOR SEEKING ORDER: Application under CPR Part 34.<br>
05
brickcourt.co.uk
+44(0)20 7379 3550 Orders for the taking of witness evidence 44 Court powers exercisable in support of arbitral proceedings.
(1) Unless otherwise agreed by the parties, the court has for the purposes of and in relation to arbitral proceedings the same power of making orders about the matters listed below as it has for the purposes of and in relation to legal proceedings.
(2) Those matters are—
(a) the taking of the evidence of witnesses;
(3) If the case is one of urgency, the court may, on the application of a party or proposed party to the arbitral proceedings, make such orders as it thinks necessary for the purpose of preserving evidence or assets.
(4) If the case is not one of urgency, the court shall act only on the application of a party to the arbitral proceedings (upon notice to the other parties and to the tribunal) made with the permission of the tribunal or the agreement in writing of the other parties.
(5) In any case the court shall act only if or to the extent that the arbitral tribunal, and any arbitral or other institution or person vested by the parties with power in that regard, has no power or is unable for the time being to act effectively.
(6) If the court so orders, an order made by it under this section shall cease to have effect in whole or in part on the order of the tribunal or of any such arbitral or other institution or person having power to act in relation to the subject-matter of the order.
(7) The leave of the court is required for any appeal from a decision of the court under this section.<br>
+44(0)20 7379 3550 Orders for the taking of witness evidence 44 Court powers exercisable in support of arbitral proceedings.
(1) Unless otherwise agreed by the parties, the court has for the purposes of and in relation to arbitral proceedings the same power of making orders about the matters listed below as it has for the purposes of and in relation to legal proceedings.
(2) Those matters are—
(a) the taking of the evidence of witnesses;
(3) If the case is one of urgency, the court may, on the application of a party or proposed party to the arbitral proceedings, make such orders as it thinks necessary for the purpose of preserving evidence or assets.
(4) If the case is not one of urgency, the court shall act only on the application of a party to the arbitral proceedings (upon notice to the other parties and to the tribunal) made with the permission of the tribunal or the agreement in writing of the other parties.
(5) In any case the court shall act only if or to the extent that the arbitral tribunal, and any arbitral or other institution or person vested by the parties with power in that regard, has no power or is unable for the time being to act effectively.
(6) If the court so orders, an order made by it under this section shall cease to have effect in whole or in part on the order of the tribunal or of any such arbitral or other institution or person having power to act in relation to the subject-matter of the order.
(7) The leave of the court is required for any appeal from a decision of the court under this section.<br>
06
brickcourt.co.uk
+44(0)20 7379 3550 Orders for the taking of witness evidence AVAILABILITY:
Third party witnesses.
Yes - Commerce and Industry Insurance Co [2002] 1 WLR 1323
No (implicitly) - DTEK v Morozov [2017] EWHC 94 (Comm) and Cruz City v Unitech [2014] EWHC 3704 (Comm)
Yes - A and B v C, D and E [2020] EWCA Civ 409
Deposition of witnesses in support of foreign arbitrations.
Yes - A and B.
A “boutique jurisdiction”; “distinctly uncomfortable”.
DISCRETION:
Section 2(3).
Comity – letter of request?
Importance of evidence.
PROCEDURE: arbitration claim form; be precise about evidence sought.<br>
+44(0)20 7379 3550 Orders for the taking of witness evidence AVAILABILITY:
Third party witnesses.
Yes - Commerce and Industry Insurance Co [2002] 1 WLR 1323
No (implicitly) - DTEK v Morozov [2017] EWHC 94 (Comm) and Cruz City v Unitech [2014] EWHC 3704 (Comm)
Yes - A and B v C, D and E [2020] EWCA Civ 409
Deposition of witnesses in support of foreign arbitrations.
Yes - A and B.
A “boutique jurisdiction”; “distinctly uncomfortable”.
DISCRETION:
Section 2(3).
Comity – letter of request?
Importance of evidence.
PROCEDURE: arbitration claim form; be precise about evidence sought.<br>
07
brickcourt.co.uk
+44(0)20 7379 3550 Production of documents Tajik Aluminium Plant v Hydro Aluminium AS [2005] EWCA Civ 1218, per Moore-Bick LJ at [25]: the documents to be produced should be “specifically identified, or at least described in some compendious manner that enabled the individual documents falling within the scope of the subpoena to be clearly identified”<br>
+44(0)20 7379 3550 Production of documents Tajik Aluminium Plant v Hydro Aluminium AS [2005] EWCA Civ 1218, per Moore-Bick LJ at [25]: the documents to be produced should be “specifically identified, or at least described in some compendious manner that enabled the individual documents falling within the scope of the subpoena to be clearly identified”<br>
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Injunctions in support of arbitration brickcourt.co.uk
+44(0)20 7379 3550 Simon Salzedo QC<br>
+44(0)20 7379 3550 Simon Salzedo QC<br>
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brickcourt.co.uk
+44(0)20 7379 3550 Anti-suit injunctions in support of arbitration Forbidden by Brussels: West Tankers Inc v Allianz SpA (The Front Comor) (Case C-185/07)[2009] AC 1138
Re-cast controversy: Gazprom, cf Nori Holdings v Bank Otkritie [2018] EWHC 1343 (Comm).
Lugano????
S37 SCA, NOT Arbitration Act: AES Ust-Kamenogorsk Hydropower Plant LLP v Ust-Kamenogorsk Hydropower Plant JSC [2013] 1 WLR 1889<br>
+44(0)20 7379 3550 Anti-suit injunctions in support of arbitration Forbidden by Brussels: West Tankers Inc v Allianz SpA (The Front Comor) (Case C-185/07)[2009] AC 1138
Re-cast controversy: Gazprom, cf Nori Holdings v Bank Otkritie [2018] EWHC 1343 (Comm).
Lugano????
S37 SCA, NOT Arbitration Act: AES Ust-Kamenogorsk Hydropower Plant LLP v Ust-Kamenogorsk Hydropower Plant JSC [2013] 1 WLR 1889<br>
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brickcourt.co.uk
+44(0)20 7379 3550 Other injunctions including freezers S44 – applies to any seat: s2(3)(b).
S44 – not mandatory (s44(1), s4).
Clear words needed to exclude s44: SABMiller v East African Breweries [2010] 2 Lloyd’s Rep 422 at ¶8
BUT in B v S [2011] 2 Lloyds Rep 18, ordinary Scott v Avery clause sufficed.
B v S wording: “Neither party hereto, nor any persons claiming under either of them, shall bring any action or other legal proceedings against the other of them in respect of any such dispute until such dispute shall first have been heard and determined by the arbitrators, umpire or Board of Appeal …”<br>
+44(0)20 7379 3550 Other injunctions including freezers S44 – applies to any seat: s2(3)(b).
S44 – not mandatory (s44(1), s4).
Clear words needed to exclude s44: SABMiller v East African Breweries [2010] 2 Lloyd’s Rep 422 at ¶8
BUT in B v S [2011] 2 Lloyds Rep 18, ordinary Scott v Avery clause sufficed.
B v S wording: “Neither party hereto, nor any persons claiming under either of them, shall bring any action or other legal proceedings against the other of them in respect of any such dispute until such dispute shall first have been heard and determined by the arbitrators, umpire or Board of Appeal …”<br>
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brickcourt.co.uk
+44(0)20 7379 3550 Other injunctions – s44 S44(4): if not urgent, court only to act on application with permission of the tribunal or agreement of other parties.
S44(3): if urgent, court may act “for the purpose of preserving evidence or assets”
Cetelem v Roust [2005] 1 WLR 3555
s44(3) is restrictive, not permissive
Assets include contractual rights<br>
+44(0)20 7379 3550 Other injunctions – s44 S44(4): if not urgent, court only to act on application with permission of the tribunal or agreement of other parties.
S44(3): if urgent, court may act “for the purpose of preserving evidence or assets”
Cetelem v Roust [2005] 1 WLR 3555
s44(3) is restrictive, not permissive
Assets include contractual rights<br>
12
brickcourt.co.uk
+44(0)20 7379 3550 Urgency issues Gerald Metals v Timis Trust [2016] EWHC 2327 (Ch)
LCIA Rules 2014
Art 9A: “exceptional urgency” expedited formation of tribunal.
Art 9B: “emergency” appointment of emergency arbitrator
No gap for “urgency” no injunction from the court
VTB Commodity Trading v JSC Antipinsky Refinery [2020] 1 WLR 1227
Urgent injunction was no longer urgent by return date
Claimant had to return to the tribunal
Court accommodated by adjourning return date<br>
+44(0)20 7379 3550 Urgency issues Gerald Metals v Timis Trust [2016] EWHC 2327 (Ch)
LCIA Rules 2014
Art 9A: “exceptional urgency” expedited formation of tribunal.
Art 9B: “emergency” appointment of emergency arbitrator
No gap for “urgency” no injunction from the court
VTB Commodity Trading v JSC Antipinsky Refinery [2020] 1 WLR 1227
Urgent injunction was no longer urgent by return date
Claimant had to return to the tribunal
Court accommodated by adjourning return date<br>
13
ARBITRATION AND INSOLVENCY: A BATTLE FOR PRECEDENCE brickcourt.co.uk
+44(0)20 7379 3550 Harry Matovu QC<br>
+44(0)20 7379 3550 Harry Matovu QC<br>
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brickcourt.co.uk
+44(0)20 7379 3550 competing public policies Arbitration
Party autonomy and the decentralisation of private dispute resolution
“Where parties agree to arbitrate, it is the policy of the law that they should be held to their bargain"
Insolvency
The orderly management of an insolvent estate by means of a public collective proceeding for the benefit of all creditors
“The non-arbitrability doctrine rests on the notion that some matters so pervasively involve public rights, or interests of third parties, which are the subjects of uniquely governmental authority, that agreements to resolve such disputes by ‘private’ arbitration should not be given effect.”<br>
+44(0)20 7379 3550 competing public policies Arbitration
Party autonomy and the decentralisation of private dispute resolution
“Where parties agree to arbitrate, it is the policy of the law that they should be held to their bargain"
Insolvency
The orderly management of an insolvent estate by means of a public collective proceeding for the benefit of all creditors
“The non-arbitrability doctrine rests on the notion that some matters so pervasively involve public rights, or interests of third parties, which are the subjects of uniquely governmental authority, that agreements to resolve such disputes by ‘private’ arbitration should not be given effect.”<br>
15
brickcourt.co.uk
+44(0)20 7379 3550 Nature of a liquidator’s claims Re MC Bacon Ltd (No.2) [1991] Ch 127
“An application to set aside a voidable preference can be made only by a liquidator or administrator and in the absence of a liquidation or administration order cannot be made at all: see section 239(1) of the Act of 1986…. [A]ny sum recovered from a creditor who has been wrongly preferred enures for the benefit of the general body of creditors, not for the benefit of the company or the holder of a floating charge. It does not become part of the company's assets but is received by the liquidator impressed with a trust in favour of those creditors amongst whom he has to distribute the assets of the company: see In re Yagerphone Ltd. [1935] Ch 392.”
Re Oasis Merchandising Services Ltd [1998] Ch 170<br>
+44(0)20 7379 3550 Nature of a liquidator’s claims Re MC Bacon Ltd (No.2) [1991] Ch 127
“An application to set aside a voidable preference can be made only by a liquidator or administrator and in the absence of a liquidation or administration order cannot be made at all: see section 239(1) of the Act of 1986…. [A]ny sum recovered from a creditor who has been wrongly preferred enures for the benefit of the general body of creditors, not for the benefit of the company or the holder of a floating charge. It does not become part of the company's assets but is received by the liquidator impressed with a trust in favour of those creditors amongst whom he has to distribute the assets of the company: see In re Yagerphone Ltd. [1935] Ch 392.”
Re Oasis Merchandising Services Ltd [1998] Ch 170<br>
16
brickcourt.co.uk
+44(0)20 7379 3550 Rubin v Eurofinance SA [2013] 1 AC 236 at [98]
“The order [for payment for an unfair preference] does not vindicate property rights which the company itself would have had prior to liquidation, but statutory rights which the liquidator has under the statutory scheme in consequence of winding up. The purpose of the order for the payment of money to a company in liquidation is not to compensate the company, but to adjust the rights of creditors among themselves in such a way as to eliminate the effects of favourable treatment afforded to one or more creditors, to the exclusion of others, in the period immediately before an insolvent administration commences…”<br>
+44(0)20 7379 3550 Rubin v Eurofinance SA [2013] 1 AC 236 at [98]
“The order [for payment for an unfair preference] does not vindicate property rights which the company itself would have had prior to liquidation, but statutory rights which the liquidator has under the statutory scheme in consequence of winding up. The purpose of the order for the payment of money to a company in liquidation is not to compensate the company, but to adjust the rights of creditors among themselves in such a way as to eliminate the effects of favourable treatment afforded to one or more creditors, to the exclusion of others, in the period immediately before an insolvent administration commences…”<br>
17
brickcourt.co.uk
+44(0)20 7379 3550 Arbitration v insolvency: Three issues (1) Privity
Is a liquidator bound by an existing arbitration agreement when pursuing an avoidance claim?
(2) Scope
As a matter of construction, was the arbitration agreement intended to govern avoidance claims by a liquidator?
Arbitrability
Is an avoidance claim by a liquidator arbitrable as a matter of public policy?<br>
+44(0)20 7379 3550 Arbitration v insolvency: Three issues (1) Privity
Is a liquidator bound by an existing arbitration agreement when pursuing an avoidance claim?
(2) Scope
As a matter of construction, was the arbitration agreement intended to govern avoidance claims by a liquidator?
Arbitrability
Is an avoidance claim by a liquidator arbitrable as a matter of public policy?<br>
18
brickcourt.co.uk
+44(0)20 7379 3550 (1) PRIVITY Riverrock Securities Ltd v International Bank of St Petersburg JSC [2020] EWHC 2483 (Comm), [2020] 2 Lloyd's Rep. 591
Per Foxton J at [54] (obiter)
There is a case for treating a claim by an administrator or liquidator to set aside a contract containing an arbitration agreement as, in substance, a claim by the insolvent company, because the administrator or liquidator will generally have supplanted the previous management of the company, which will not retain any power of independent action in relation to the contract in issue.<br>
+44(0)20 7379 3550 (1) PRIVITY Riverrock Securities Ltd v International Bank of St Petersburg JSC [2020] EWHC 2483 (Comm), [2020] 2 Lloyd's Rep. 591
Per Foxton J at [54] (obiter)
There is a case for treating a claim by an administrator or liquidator to set aside a contract containing an arbitration agreement as, in substance, a claim by the insolvent company, because the administrator or liquidator will generally have supplanted the previous management of the company, which will not retain any power of independent action in relation to the contract in issue.<br>
19
brickcourt.co.uk
+44(0)20 7379 3550 (2) SCOPE Team Y&R Holdings v Ghossoub [2017] EWHC 2401 (Comm)
Per Laurence Rabinowitz QC
It was unlikely that contracting parties intended to agree to submit to the English courts an unfair prejudice dispute in respect of which they lacked jurisdiction to grant a remedy<br>
+44(0)20 7379 3550 (2) SCOPE Team Y&R Holdings v Ghossoub [2017] EWHC 2401 (Comm)
Per Laurence Rabinowitz QC
It was unlikely that contracting parties intended to agree to submit to the English courts an unfair prejudice dispute in respect of which they lacked jurisdiction to grant a remedy<br>
20
brickcourt.co.uk
+44(0)20 7379 3550 (3) arbitrability Fulham Football Club (1987) Ltd v Richards [2011] EWCA Civ 855, [2012] Ch 333 (CA)
Larsen Oil and Gas Pte Ltd v Petroprod Ltd [2011] 3 SLR 414 (Sing. CA)
Nori Holding Ltd v PJSC Bank Okritie Financial Corp [2018] 2 Ll. Rep. 80, [2018] 2 All E.R. (Comm) 1009 (Males J)
Riverrock Securities Ltd v International Bank of St Petersburg JSC [2020] EWHC 2483 (Comm), [2020] 2 Lloyd's Rep. 591 (Foxton J)<br>
+44(0)20 7379 3550 (3) arbitrability Fulham Football Club (1987) Ltd v Richards [2011] EWCA Civ 855, [2012] Ch 333 (CA)
Larsen Oil and Gas Pte Ltd v Petroprod Ltd [2011] 3 SLR 414 (Sing. CA)
Nori Holding Ltd v PJSC Bank Okritie Financial Corp [2018] 2 Ll. Rep. 80, [2018] 2 All E.R. (Comm) 1009 (Males J)
Riverrock Securities Ltd v International Bank of St Petersburg JSC [2020] EWHC 2483 (Comm), [2020] 2 Lloyd's Rep. 591 (Foxton J)<br>
21
Arbitration mini series Wednesday 19 May at 12.30pm, Session 2:
Arbitration and the Courts: orders in support and the impact of insolvency proceedings
chaired by Helen Davies QC
Jacob Rabinowitz - Orders to secure the attendance of witnesses and document production
Simon Salzedo QC - Injunctions in support of arbitration
Harry Matovu QC - Arbitration and insolvency: a battle for precedence brickcourt.co.uk
+44(0)20 7379 3550<br>
Arbitration and the Courts: orders in support and the impact of insolvency proceedings
chaired by Helen Davies QC
Jacob Rabinowitz - Orders to secure the attendance of witnesses and document production
Simon Salzedo QC - Injunctions in support of arbitration
Harry Matovu QC - Arbitration and insolvency: a battle for precedence brickcourt.co.uk
+44(0)20 7379 3550<br>