May 19, 2024

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CASE ANALYSIS: Gunga v Sonangol [2022] EWHC 1372 (Comm) – Arbitration & Dispute Resolution

CASE ANALYSIS: Gunga v Sonangol [2022] EWHC 1372 (Comm) – Arbitration & Dispute Resolution

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Mini-summary

A dispute arose as to the appointment of arbitrators and the&#13
constitution of the tribunal. The claimant’s posture is that&#13
the respondent failed to appoint its arbitrator within just time and the&#13
very first appointed arbitrator should be verified as sole arbitrator.&#13
The respondent statements that its arbitrator was appointed within just&#13
time, if not it seeks an extension of time for accomplishing so. The&#13
respondent has also sought to obstacle the appointment of the&#13
initially arbitrator on the grounds of obvious bias.

The English court’s determination worries purposes for&#13
disclosure of (1) communications involving the respondent and their&#13
putative arbitrators and (2) data relating to the id of&#13
the claimant.

The court applied the following principles:

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  1. The applicant have to show that the arbitration declare has a&#13
    serious prospect of success.
  2. &#13
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  3. The documents sought must be strictly important for the honest&#13
    disposal of the arbitration declare.
  4. &#13
    &#13

  5. In performing exercises its discretion, regard should be presented to the&#13
    overriding aim with distinct regard to the context of&#13
    arbitration.
  6. &#13

Gunga Delivery Co NV v Sonangol Transport Angola (Luanda) Ltd&#13
(transcript)
[2022] EWHC 1372 (Comm)

What are the simple implications of this case?

The English court is highly supportive of arbitrators and&#13
arbitration approach. It will not lightly get disclosure of&#13
paperwork and will get into account the variance amongst courtroom&#13
procedure and arbitration system when creating its rulings.

In particular, the court docket though considering the overriding&#13
goal will rarely exercising its discretion to get disclosure&#13
in arbitration claims simply because:

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  • There ought to be small courtroom intervention
  • &#13
    &#13

  • Arbitration is underpinned by rules of speedy and final&#13
    dispute resolution
  • &#13
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  • If the get-togethers have explicitly or implicitly agreed with every&#13
    other or the tribunal that files would keep on being confidential,&#13
    they should keep on being so.
  • &#13

The court will seek out to slender any software for disclosure on&#13
the basis of these rules and in certain seeking to handle&#13
the question as to irrespective of whether the documents are strictly&#13
essential
for the resolution of the arbitration declare in&#13
problem.

What was the track record?

The claimants commenced arbitration and appointed Mr Simon Gault&#13
as arbitrator on 22 December 2021. The agreed applicable&#13
arbitration principles are the London Maritime Arbitrators Association&#13
(LMAA) Terms 2022. Pursuant to those guidelines the respondent was&#13
expected to appoint their arbitrator by 5 January 2022, failing&#13
which the claimant may perhaps phone on the first arbitrator appointed to be&#13
the sole arbitrator.

On 3 January lawyers for the respondent contacted Decide Freeh to&#13
enquire if he would be willing to take the appointment. On 1&#13
February Decide Freeh reported that he could no lengthier take part in&#13
the arbitration.

Shortly thereafter the claimant served see to appoint Mr&#13
Gault as sole arbitrator. The respondent refused to accept this&#13
detect and appointed or purported to appoint Mr Gary Born as&#13
co-arbitrator. The respondent also requested disclosure from Mr&#13
Gault the selection of appointments by the claimant’s legal professionals about&#13
the earlier 10 several years.

In brief, the get-togethers have been unable to agree regardless of whether Mr Gault&#13
has been appointed as sole arbitrator or whether Mr Born has been&#13
appointed as co-arbitrator. The parties agree that this turns on&#13
whether or not or not Choose Freeh acknowledged his appointment as arbitrator&#13
or not. Supplied that the tribunal has not been constituted, recourse&#13
below the English Arbitration Act 1996 is to the Large Courtroom.

What did the court decide?

The court held that the concepts set out in P v Q&#13
[2017] EWHC 148 (Comm) ended up relevant to the apps.

1. Deserves – at this stage the decide could not kind any&#13
perspective on the deserves but however proceeded on the presumption&#13
that there was a genuine prospect of good results.

2. Requirement

(a) The appointment of Choose Freeh

It was agreed involving the parties that the concern of regardless of whether&#13
Mr Gault could be verified as sole arbitrator turned on no matter whether or&#13
not Judge Freeh experienced been appointed by 5 January 2022. The take a look at for&#13
irrespective of whether an arbitrator has been appointed established out in Tradax&#13
Export v Volkswagenwerk
[1970] 1 QB 537 is no matter if:

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  • the other aspect has been educated of the appointment
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    &#13

  • the appointee has been knowledgeable and
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    &#13

  • the appointee is ready to act and has claimed so.
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Even though the judge regarded as that correspondence postdating 5&#13
January 2022 really should not be appropriate there may possibly be correspondence&#13
just after that day which implies that these exams experienced been met. The&#13
choose for that reason ordered that individuals communications should be&#13
reviewed by an English solicitor to determine whether there are any&#13
such documents.

(b) The appointment of Mr Born

It was argued that the communications amongst the respondent and&#13
Mr Born were being relevant to the application for an extension of time&#13
for the appointment, in the celebration that Judge Freeh experienced not been&#13
appointed. The judge dominated that the problem of regardless of whether a&#13
considerable injustice would be triggered if time had been not extended&#13
would not convert on communications among the respondent and Mr&#13
Born. The software was refused.

(c) The identification of the claimant

The respondent built programs for intensive discovery of&#13
information relating to the claimant ostensibly to permit the&#13
arbitrator to distinct conflict. The claimant resisted the software&#13
on the foundation that it was a fishing expedition, but however&#13
have been keen to provide particular documentation. The choose declined&#13
to purchase the disclosure expressing that it could not be explained that this&#13
details was strictly vital for the purposes of the&#13
appointments. If the arbitrators necessary these kinds of information and facts they could&#13
request it, but the courtroom would not get it.

3. Discretion and arbitration context

The decide thought of that these orders would provide a speedy&#13
resolution with minimal court docket intervention and consequently fulfilled the&#13
overriding goal within just an arbitration context.

Scenario specifics

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  • Court: Queen’s Bench Division (Commercial Court)
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  • Judge: Butcher J
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  • Day of judgment: 13/5/2022
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This post was first released by LexisPSL on 29 November&#13
2022.

The content of this report is supposed to offer a&#13
basic information to the subject matter subject. Expert assistance should be&#13
sought about your particular conditions.

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