Arbitrators and EU courts
The exclusion of arbitration from European Council Regulation (EC) No 44/2001, which determines jurisdiction within the EU, has given rise to a plethora of complex issues where judicial proceedings are commenced in apparent breach of an arbitration clause. The EU principle here is that it is not possible to restrain a party by judicial anti-suit injunction from bringing proceedings in another EU court which possesses jurisdiction over the claim under the jurisdiction rules in the Regulation. The question in West Tankers Inc v Allianz SpA and Another (The Front Comor)  EWHC 854 (Comm);  2 Lloyd’s Rep 103 was whether that prohibition extends to arbitrators.
West Tankers : the facts
It could not have been predicted on 8 August 2000 that the collision that day between West Tanker’s vessel Front Comor and a pier in Sicily belonging to ERG Petroli would set in motion a series of legal proceedings which would occupy the thoughts of arbitration lawyers throughout the EU for a decade (and still counting). The facts of the dispute are remarkably simple. ERG had chartered the vessel from West Tankers on terms that ERG would hold West Tankers harmless. The charterparty contained a London arbitration clause. ERG’s insurers paid up to the policy limits of €15 million for the repair of the pier. ERG commenced arbitration in London for the uninsured sum. In the meantime ERG’s insurers sought to recover the sum paid by them, exercising subrogation rights against West Tankers. Had the insurers accepted that they were bound by the arbitration clause, no more would have been heard of the matter: the claim would probably have been dismissed (as was ERG’s own claim in arbitration), and in the absence of any grounds for challenging the award the matter would have come to a conclusion. However, the insurers chose not to go down the arbitration route but instead commenced subrogation proceedings in the Italian courts.
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