BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
COMMERCIAL COURT (QBD)
IN AN ARBITRATION CLAIM
Rolls Building Fetter Lane, London, EC4A 1NL |
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B e f o r e :
(sitting as a Judge of the High Court)
BETWEEN:
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VTB BANK (PJSC) | Claimant/Applicant | |
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VALERI DZHANIBEKOVICH MEJLUMYAN | Defendant/Respondent |
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Mr Vernon Flynn QC and Mr Stephen Donnelly (instructed by King & Spalding International LLP) appeared for the Defendant/Respondent
Hearing date: 23 March 2021
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Crown Copyright ©
Covid-19 Protocol: This judgment was handed down remotely by circulation to the parties' representatives by email and release to BAILII. The date and time for hand-down is deemed to be 10:00am on 25 March 2021.
SIR WILLIAM BLAIR:
Factual background to the share pledge agreement
"10.1 This Agreement shall be construed and governed in accordance with the laws of the Republic of Armenia.
10.2 Any dispute (a 'Dispute') arising out of or in connection with this Agreement (including a dispute regarding the existence, validity or, termination of this Agreement or the consequences of its nullity) (or any non-contractual obligations arising out of or in connection with this Agreement) shall be referred to and finally resolved by arbitration under the LCIA Rules (the "Rules") of the London Court of International Arbitration ("LCIA").
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10.3.4 The seat of arbitration shall be London, England and the language of the arbitration shall be English."
The court proceedings in Armenia
The present position of the Termination Proceedings (Claim No.31505/02/19)
The directions given in respect of the applications
"1. On 22 February 2021, I gave the Claimant permission to serve an Application Form out of the jurisdiction for the purpose of seeking an Anti-Suit Injunction to restrain pursuit of proceedings commenced by the Respondent in Armenia ("the Armenian Proceedings"). That hearing has been fixed for 23 March 2021.
2. On 10 March 2021, the Defendant, who said he had only recently instructed English lawyers, and was suffering from severe illness, sought an extension of time to serve evidence in the application for the ASI and of the hearing. The Defendant is seeking an expedited hearing of that application.
3. The Claimant resists the adjournment application unless steps are taken to [stop] the Armenian Proceedings. The Defendant submits that he is not in a position to take such steps or that he has already taken such steps as he can.
4. I have concluded that the appropriate course is for the hearing on 23 March 2021 to remain in the diary, and for the Defendant's adjournment application to be heard at the start of that hearing. At that hearing, it will be open to the Judge to decide:
a. To proceed with the hearing on its merits.
b. To adjourn the hearing and give further procedural directions for a substantive hearing at a future date.
c. In conjunction with (b), to grant some form of ASI relief, even if that were to be treated as effectively on a "without notice" basis, in an effort to hold the ring in the meantime.
5. The parties should be as prepared as they can be for these permutations. They are also asked to consider whether there is scope for resolving matters in advance of the hearing on the basis of some combination of 4(b) and (c)."
The parties' contentions
Discussion and conclusion
(1) The claimant must satisfy the court "on the material adduced at the interlocutory hearing" that there is a "high degree of probability" that there is a binding and applicable arbitration agreement: Emmott v Michael Wilson & Partners [2018] 1 Lloyd's Rep. 299 (CA);
(2) If it is satisfied that there is a binding and applicable arbitration agreement, the court should ordinarily restrain foreign proceedings brought in breach of the agreement unless the defendant can show "strong reasons" not to do so: Donohue v Armco Inc [2002] 1 Lloyd's Rep 425 (HL) per Lord Bingham at [24] (see also Emmott v Michael Wilson at [38])
(3) Anti-suit relief is a discretionary remedy and there are no absolute or inflexible rules governing its exercise: Donohue v Armco Inc [2002] 1 Lloyd's Rep 425 (HL) at [24]. There are, however, well-established objections, as where the claimant has delayed in applying for relief (Ecobank Transnational Inc v Tanoh [2016] 1 WLR 2231, Christopher Clarke LJ at [123]–[127]), and as where the claimant has submitted to the jurisdiction of the foreign court (SAS Institute Inc. v World Programming Ltd [2020] EWCA Civ 599, Males LJ at [114]–[116]. A summary is found in David Joseph, Jurisdiction and Arbitration Agreements and their Enforcement (3rd edn, 2015), para. 12.130.