H J HEINZ CO LTD V EFL INC

[2010] EWHC 1203 (Comm), Queen's Bench Division, Commercial Court, Mr Justice Burton, 28 May 2010

Arbitration - Enforcement of foreign award - New York Convention - Allegation after award of forged evidence - Application to overturn award rejected in curial courts - Enforcement in England - Whether respondent estopped from defending enforcement proceedings - Arbitration Act 1996, section 103(2)

HJH agreed to supply baby food manufacturing equipment to EFL under an agreement which provided for arbitration in Hungary. EFL commenced arbitration proceedings, and obtained an award of damages of about £5 million on the ground that HJH had failed to supply the equipment and that EFL had been unable to perform three distribution contracts with other parties. HJH's defence in the arbitration was that the distribution contracts were shams, that the distributors were connected to EFL and that there had never been any intention to perform those contracts. After the award, HJH obtained evidence indicating that the distribution contracts were forgeries, and HJH made a criminal complaint. The criminal proceedings did not go ahead, for lack of evidence. An appeal against the award was dismissed by the Metropolitan Court of Budapest, and a further appeal to the Supreme Court was also dismissed. EFL then sought to enforce the award in England, and HJH resisted enforcement in reliance on section 103(2) of the Arbitration Act 1996, namely, that enforcement in England would be contrary to public policy. EFL asserted that there was no evidence of fraud which could justify refusal to enforce, and also that HJH was estopped from challenging the award by reason of the Hungarian judgments. Burton J held that the matter should proceed to trial.