Minister of Finance (Incorporated) v 1Malaysia Development Berhad & Ors

Minister of Finance (Incorporated) v 1Malaysia Development Berhad & Ors

The Court of Appeal held that the High Court judge erred in granting a case management stay of the claimants' applications under sections 67 and 68 of the Arbitration Act 1996 and in refusing an injunction to restrain the second arbitrations. The court's supervisory jurisdiction under the 1996 Act is mandatory and cannot be ousted by subsequent agreements. The pursuit of the second arbitrations, which sought to penalise the claimants for exercising their statutory rights, was vexatious and oppressive. The appeal was allowed, the stay was lifted, and an injunction was granted to restrain the second arbitrations until the court applications are finally determined.

Parties
Claimant/appellant: Minister of Finance (Incorporated); Claimant/appellant: 1Malaysia Development Berhad; Defendant/respondent: International Petroleum Investment Company; Defendant/respondent: Aabar Investments PJS
Jurisdiction
England and Wales
Judgment Date
26 November 2019
Procedural Posture
Civil Appeal / Appeal From High Court Judgment on Case Management Stay and Injunction
Outcome
Appeal allowed
Legal Topics
Arbitration Act 1996 Sections 67 and 68, Case Management Stay, Injunction to Restrain Arbitration, Party Autonomy, Jurisdiction of Arbitral Tribunal, Public Policy in Arbitration
Arbitration Commercial Law Arbitration Act 1996 Sections 67 and 68 Case Management Stay Injunction to Restrain Arbitration Party Autonomy Jurisdiction of Arbitral Tribunal Public Policy in Arbitration

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Parties

Minister of Finance (Incorporated)

Claimant/appellant

1Malaysia Development Berhad

Claimant/appellant

International Petroleum Investment Company

Defendant/respondent

Aabar Investments PJS

Defendant/respondent

Procedural Posture

Civil Appeal / Appeal From High Court Judgment on Case Management Stay and Injunction

Legal Issues

  1. 1 Whether the High Court erred in granting a case management stay of applications under sections 67 and 68 of the Arbitration Act 1996
  2. 2 Whether the High Court erred in refusing an injunction to restrain the pursuit of second arbitrations
  3. 3 Whether the claimants' statutory rights under the Arbitration Act 1996 were infringed by the second arbitrations

Ratio Decidendi

The Court of Appeal held that the High Court judge erred in granting a case management stay of the claimants' applications under sections 67 and 68 of the Arbitration Act 1996 and in refusing an injunction to restrain the second arbitrations. The court's supervisory jurisdiction under the 1996 Act is mandatory and cannot be ousted by subsequent agreements. The pursuit of the second arbitrations, which sought to penalise the claimants for exercising their statutory rights, was vexatious and oppressive. The appeal was allowed, the stay was lifted, and an injunction was granted to restrain the second arbitrations until the court applications are finally determined.

Court Disposition

Appeal allowed

Orders

  • Stay on the claimants' court applications under sections 67 and 68 is removed
  • Injunction granted restraining the pursuit of the second arbitrations until final determination of the court applications