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Is This The End of Anti-Suit Injunctions in Europe?
Insurance Law Update
European Court of Justice
An advocate general of the European Court of Justice (ECJ) has recently opined that a party to a contract containing a London arbitration clause cannot obtain an anti-suit injunction for the purpose of preventing another party from issuing competing litigation in another European Union (EU) member state.
The opinion was rendered in Allianz SpA and others v West Tankers Inc (the “Front Comor”),([2008] Lloyd's Rep. 82) a case that involved a referral by the House of Lords to the ECJ of the question: is an anti-suit injunction incompatible with Regulation 44/2001 on jurisdiction and the recognition and enforcement of judgments?
The Front Comor was owned by West Tankers and leased to Erg Petroli. The charterparty was governed by English law and contained a London arbitration clause. The vessel was involved in a collision with a jetty (also owned by Erg Petroli). Erg recovered €15.5 million in respect of the damage from its insurer, Allianz. Allianz subsequently commenced subrogated proceedings against West Tankers in Italy.
The advocate general concluded that it was not permissible for a U.K. court to issue an anti-suit injunction to restrain Erg Petroli from pursuing litigation in breach of the arbitration clause. She reasoned that the principle of “mutual trust” underpinned community law. Even if the proceedings were brought to cause delay, the court first seized should be trusted to examine its jurisdiction without interference from the court of another member state. The final decision of the ECJ is presently awaited and it remains to be seen whether the ECJ will follow the advocate general’s lead.
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