BRAVE BULK TRANSPORT LTD V SPOT ON SHIPPING LTD

[2009] EWHC 612 (QB), Queen's Bench Division, Mr Justice Burton, 18 February 2009

Civil procedure – Anti-suit injunction – Judgment obtained in default in respect of claim under Forward Freight Swap Agreement – Successful party seeking enforcement in Rule B proceedings in New York – Third party seeking anti-suit injunction against Rule B proceedings in UK court

Z applied to intervene in proceedings in which Brave Bulk (BB) had obtained judgment in default in respect of a claim under a Forward Freight Swap Agreement (FFA) against Spot on Shipping Ltd (SOS). Z also applied for an anti-suit injunction in respect of attachment proceedings brought in New York under Rule B of the Federal Rules of Civil Procedure Supplemental Rules for Certain Admiralty Claims, which BB had commenced in order to enforce the judgment against SOS. There was also a separate application from Z with the same scope (in case the application to intervene was unsuccessful). BB disputed the court’s jurisdiction and sought the setting aside of the claim form. There was an argument that Z was really an alter ego of SOS and the aim of Z’s intervention was to ensure that it did not come to be regarded as a party to the FFA for enforcement purposes. Z argued that this issue fell within the English jurisdiction clause in the FFA. Burnton J dismissed Z’s applications. An attempt by BB in the light of an unsatisfied judgment to recover the judgment debt in proceedings against another party based on the alter ego doctrine as understood in New York law was not a claim that fell within the jurisdiction clause of the FFA. It did not relate to the FFA, however broadly construed. BB therefore had not sought expressly nor impliedly to establish that Z was a party to the FFA, nor that it was liable pursuant to it; nor were they seeking to enforce the FFA against Z through the enforcement proceedings, which were against SOS. There was no abuse, no arguable case for jurisdiction in the English courts and no ground to restrain the New York proceedings.