CMA- CGM Marseille v Petro Broker International

CMA- CGM Marseille v Petro Broker International

The Court of Appeal held that the rationale for requiring payment into court was to secure Petroval’s position when enforcement against guarantees was blocked by the freezing order. Once the awards became enforceable as judgments and the money was in court, Petroval was entitled to enforce against it. The predisposition under CPR 3.1(6A) is that money paid into court as security should be available for enforcement of sums payable in the proceedings. There was no reason to require Petroval to enforce elsewhere when funds were available in court. The judge below erred in principle by ordering payment out to CMA; the money should be paid to Petroval in partial satisfaction of the awards.

Parties
Claimant/respondent: CMA-CGM Marseille; Defendant/appellant: Petro Broker International (Formerly known as Petroval Bunker International)
Jurisdiction
England and Wales
Judgment Date
19 April 2011
Procedural Posture
Civil Appeal (commercial/arbitration) / Appeal From Queen’s Bench Division, Commercial Court, Post Arbitral Award Enforcement
Outcome
Appeal allowed
Legal Topics
Enforcement of Arbitral Awards, Freezing Injunctions, Security for Judgment, Set Off and Counterclaim, Jurisdiction of Arbitral Tribunal and Court
Arbitration Commercial Law Civil Procedure Enforcement of Arbitral Awards Freezing Injunctions Security for Judgment Set Off and Counterclaim Jurisdiction of Arbitral Tribunal and Court

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Parties

CMA-CGM Marseille

Claimant/respondent

Petro Broker International (Formerly known as Petroval Bunker International)

Defendant/appellant

Procedural Posture

Civil Appeal (commercial/arbitration) / Appeal From Queen’s Bench Division, Commercial Court, Post Arbitral Award Enforcement

Legal Issues

  1. 1 Whether the sum of US$4.5M paid into court as a condition of a freezing injunction should be returned to CMA or remain available for Petroval to enforce arbitral awards
  2. 2 Whether the court had jurisdiction to grant the freezing order
  3. 3 Whether the rationale for payment into court continued after discharge of the injunction

Ratio Decidendi

The Court of Appeal held that the rationale for requiring payment into court was to secure Petroval’s position when enforcement against guarantees was blocked by the freezing order. Once the awards became enforceable as judgments and the money was in court, Petroval was entitled to enforce against it. The predisposition under CPR 3.1(6A) is that money paid into court as security should be available for enforcement of sums payable in the proceedings. There was no reason to require Petroval to enforce elsewhere when funds were available in court. The judge below erred in principle by ordering payment out to CMA; the money should be paid to Petroval in partial satisfaction of the awards.

Court Disposition

Appeal allowed

Orders

  • Order of Hamblen J set aside
  • US$4.5M paid into court, together with interest, to be paid to Petroval in partial satisfaction of the arbitral awards