KONKOLA COPPER MINES PLC V U&M MINING ZAMBIA LTD

[2014] EWHC 2146 (Comm), Queen's Bench Division, Commercial Court, Mr Justice Eder, 2 July 2014

Arbitration - Appeal against award - Serious irregularity - Jurisdiction - Application for security for costs - Application for security for award - Arbitration Act 1996, section 70(6) and (7)

KCM, a Zambian company, entered into agreements with U&M, also a Zambian company, under which U&M was to provide open-pit mining and related services at a mine belonging to KCM. Disputes arose between the parties, and they were resolved by a Settlement Agreement in October 2012: disputes under that agreement were to be resolved by LCIA arbitration in London. Disputes did arise, and were referred to arbitration. By its first award, dated 7 November 2013, the tribunal found that the Settlement Agreement was binding and that KCM was to pay to U&M the sums of US$14,619,900.12 and £15,155.23. By a second award dated 6 January 2014 the tribunal ordered that KCM was to make an interim payment of £1,096,876.01 on account of U&M's legal costs, that KCM was to pay to U&M £15,000 representing the deposit paid to the LCIA by U&M on KCM's behalf and that invoices totalling US$40,205,995.31 were to be paid forthwith "unless KCM shows cause, supported by evidence within 14 days, why the invoices ... should not be immediately payable". By a third award dated 24 March 2014 KCM was ordered to pay U&M's costs relating to the first award on an indemnity basis, assessed as £1,262,399.80, a sum which included the interim amount of £1,096,876.01 in the second award. KCM appealed against the second award on the grounds of want of jurisdiction under section 67 of the Arbitration Act 1996) and serious irregularity (section 68 of the Arbitration Act 1996). U&M sought security for costs in relation to that challenge (under section 70(6) of the 1996 Act) and security for the sums payable under the second award (under section 70(7) of the 1996 Act).