Anti-suit relief

The English courts will readily grant an anti-suit injunction to prevent foreign proceedings in breach of an arbitration clause specifying arbitration in England, as long as the applicant has acted with reasonable speed in seeking relief. REC Wafer Norway AS v Moser Baer Photo Voltaic Ltd [2010] EWHC 2581 (Comm), a decision of Blair J, had special facts, in that although the delay was lengthy, the ground relied upon by the applicant related not to the commencement of foreign proceedings but rather their continuation once an English court had dismissed a similar claim by the respondent.

REC Wafer Norway: the facts

The claimant, REC, is a Norwegian company whose business included supplying silicon wafers for use in solar panels. Under an agreement dated 25 July 2007 REC agreed supply wafers to Moser Baer, a major manufacturer of solar panels in India, for the next eight years. Any disputes were to be resolved in ICC arbitration in London, and it was common ground that the seat of the arbitration was England. By way of security for payment to REC, Moser Baer opened two irrevocable on-demand bank guarantees, the first for US$40m issued by Canara Bank on 25 September 2007, and the second for US$45m guarantee issued by Union Bank of India on 30 June 2008. The guarantees required the banks to pay up to the guarantee limit on receipt of REC’s first demand in writing and a written statement detailing Moser Baer’s breach of its payment obligations. The guarantees were governed by English law.