BNP Paribas SA v Open Joint Stock Company Russian Machines & Anor

BNP Paribas SA v Open Joint Stock Company Russian Machines & Anor

The court held that it had jurisdiction over both defendants for the anti-suit claims, as the claims passed through the relevant jurisdictional gateways, including s.44 Arbitration Act 1996 and the necessary or proper party gateway. There was a serious issue to be tried as to whether the defendants acted unconscionably to frustrate the arbitration. Service on the first defendant was retrospectively validated under CPR 6.15(2), and alternative service on the second defendant was justified due to urgency and not being illegal under Russian law. Delay by the claimant did not preclude relief in the circumstances. The defendants' applications challenging jurisdiction and service were dismissed.

Parties
Claimant: BNP ParIBAS S. A.; First Defendant: Open Joint Stock Company Russian Machines; Second Defendant: Joint Stock Asset Management Company Ingosstrakh-Investments
Jurisdiction
England and Wales
Judgment Date
24 November 2011
Procedural Posture
Commercial Court Arbitration/anti Suit Injunction / Interlocutory Applications on Jurisdiction, Service, and Interim Relief
Outcome
Defendants' applications dismissed; claimant's applications for validation of service and alternative service granted.
Legal Topics
Anti Suit Injunctions, Jurisdictional Gateways, Service Out of Jurisdiction, Arbitration Agreements, Alternative Service, Delay in Seeking Relief
Arbitration Civil Procedure Conflict of Laws Anti Suit Injunctions Jurisdictional Gateways Service Out of Jurisdiction Arbitration Agreements Alternative Service +1 more

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Parties

BNP ParIBAS S. A.

Claimant

Open Joint Stock Company Russian Machines

First Defendant

Joint Stock Asset Management Company Ingosstrakh-Investments

Second Defendant

Procedural Posture

Commercial Court Arbitration/anti Suit Injunction / Interlocutory Applications on Jurisdiction, Service, and Interim Relief

Legal Issues

  1. 1 Whether the English court has jurisdiction over the defendants for anti-suit relief in support of arbitration
  2. 2 Whether service on the defendants was valid or should be retrospectively/prospectively validated
  3. 3 Whether the claimant is entitled to anti-suit injunctive relief against the defendants

Ratio Decidendi

The court held that it had jurisdiction over both defendants for the anti-suit claims, as the claims passed through the relevant jurisdictional gateways, including s.44 Arbitration Act 1996 and the necessary or proper party gateway. There was a serious issue to be tried as to whether the defendants acted unconscionably to frustrate the arbitration. Service on the first defendant was retrospectively validated under CPR 6.15(2), and alternative service on the second defendant was justified due to urgency and not being illegal under Russian law. Delay by the claimant did not preclude relief in the circumstances. The defendants' applications challenging jurisdiction and service were dismissed.

Court Disposition

Defendants' applications dismissed; claimant's applications for validation of service and alternative service granted.

Orders

  • Jurisdiction upheld over both defendants for anti-suit claims.
  • Service on the first defendant retrospectively validated under CPR 6.15(2).