ENKA INSAAT VE SANAYI AS V OOO “INSURANCE COMPANY CHUBB” AND OTHERS

[2020] EWCA Civ 574, Court of Appeal, Lord Justice Flaux, Lord Justice Males and Lord Justice Popplewell, 29 April 2020

Arbitration – Anti-suit injunction – Dispute as to scope of arbitration clause – Proceedings brought in Russian courts – Law applicable to arbitration clause – Criteria for grant of anti-suit injunction – Senior Courts Act 1981, section 37

Enka entered into a sub-contract, subsequently assigned by the contractor to Unipro, to carry out works on the construction of the Berezovskaya power plant. The contract did not contain a choice of law clause, but there was a tiered dispute resolution clause providing that ultimately any dispute was to be resolved by arbitration under International Chamber of Commerce rules in London. A massive fire occurred in February 2016. The insurers, Chubb Russia, made payment. In 2017 Chubb Russia’s lawyers wrote to Enka asserting that the fire had been caused by defects in the fuel oil pipelines attributable to work performed by Enka. No claim was made against Enka at that stage. On 24 April 2019 Enka received a letter before action, contending that Enka and 10 other parties were responsible under the Russian Civil Code for the damage and stating that if Enka did not make payment then a remedy would be sought. There was reference to court proceedings. Enka did not respond to Chubb Russia. On 25 May 2019 Chubb Russia filed a subrogation claim with the Moscow Arbitrazh Court on 25 May 2019 alleging infringements of the Russian Civil Code. After two adjournments, on 3 September 2019 the Russian court ruled that a viable claim had been made. Enka was informed the following day. Enka continued to refuse to engage with the Russian proceedings. On 16 September Enka commenced an action in England for anti-suit relief in reliance on the arbitration clause, and on the following day Enka asked the Russian court to dismiss the action on the basis of the arbitration clause. The Russian court dismissed the proceedings in March 2020 but did not give reasons. The question was whether an anti-suit injunction against Chubb Russia should be granted.