Unicredit Bank GmbH v Ruschemalliance LLC
[2024] EWCA Civ 64
Commerzbank AG v RusChemAlliance LLC
31 August 2023
[2023] EWHC 2510 (Comm)
High Court
Two companies had a contract saying any disagreements would be settled in Paris, but one company sued in Russia instead. A UK court stopped the Russian lawsuit because the contract said it had to go to Paris. The court considered another similar case, but used expert advice to show that the Paris court would also likely support the action.
Key Facts
- •Commerzbank (Claimant) sought an interim anti-suit injunction (ASI) against RusChem (Defendant) to prevent RusChem from pursuing proceedings before the Arbitrazh Court of St. Petersburg.
- •The dispute arose from a performance bond issued by Commerzbank in favor of RusChem, governed by English law and containing an arbitration agreement with the seat in Paris.
- •RusChem commenced proceedings in Russia, arguing the arbitration agreement was unenforceable due to sanctions imposed on it.
- •Commerzbank argued that RusChem's Russian proceedings breached the arbitration agreement.
- •The case considered the relevance of the arbitration seat being in Paris when granting an anti-suit injunction in England, particularly in light of a recent Commercial Court decision (SQD) which refused a similar injunction.
Legal Principles
Anti-suit injunctions can be granted to support arbitration proceedings and restrain breaches of arbitration agreements.
The Angelic Grace [1995] 1 Lloyd's Rep 87
An anti-suit injunction will readily be granted if: (a) the claimant demonstrates the existence of an arbitration clause covering the dispute; and (b) there are no exceptional circumstances.
Merkin on Arbitration Law at [8.94]
The English court must have personal jurisdiction over the defendant.
CPR 6.36 and 6.37, Ust-Kamenogorsk Hydropower Plant JSC v AER Ust-Kamenogorsk Hydropower Plant LLP [2013] UKSC 35
The High Court may grant an injunction if it appears just and convenient to do so.
Section 37(1) of the Senior Courts Act 1981
The jurisdiction to grant anti-suit injunctions may be exercised regardless of whether the court is at the seat of arbitration, as long as there is personal jurisdiction over the defendant.
Gee on Commercial Injunctions at [14]-[021], LV Finance Group v IPOC International Growth Fund Ltd [2006] Bda LR 69
Outcomes
Interim anti-suit injunction granted.
The court found that the arbitration agreement was valid and governed by English law, RusChem's Russian proceedings breached the agreement, Commerzbank acted promptly, and no exceptional circumstances existed to prevent the injunction despite the arbitration seat being in Paris. Expert evidence on French law indicated that French courts would likely not grant pre-arbitration relief and would welcome the English court's anti-suit injunction.
Order for alternative service granted.
To ensure timely notice to RusChem, alternative service via email was permitted.