This matter concerned the return date of an initial anti-suit injunction which was granted ex parte against the defendant charterers, Transnav Purpose Navigation Ltd. The claimant, Sam Purpose SA, the owner of the vessel Sam Purpose, wanted the usual final form of anti-suit injunction that the defendant should take positive steps to discontinue the litigation proceedings it commenced in Nigeria. The defendant’s position was that there should be no further injunctive relief.

The vessel was first arrested in Lagos in October 2016 by creditors unconnected with the charterers. The charterers then issued proceedings in the Nigerian High Court on 10 January 2017, and arrested the vessel on 19 January 2017.

The agreements made between the owners and the charterers all contained a London arbitration clause, and it was clear that the substantive claim commenced in Nigeria fell squarely within that clause.

It was, however, submitted that in Nigeria, it was not possible to obtain the arrest of a vessel without commencing the substantive claim there as well. Given that the proceedings in Nigeria went beyond security, an initial anti-suit injunction was granted the English Court.

In breach of this injunction, the charterers applied for judgment in default on their substantive claims against the owners. The owners threatened contempt of court proceedings, and the charterers withdrew their application for default judgment.

It subsequently came to light that pursuant to s 10.1 and s 10.2 of the Nigerian Admiralty Jurisdiction Act 1991, the Nigerian Court had the power to stay proceedings on the ground that the claim concerned should be determined by arbitration, whilst maintaining the arrest or releasing it on the owner’s provision of satisfactory security.  

The judge began his analysis of the matter by citing with approval the statement of principle given by Jonathan Hirst QC sitting as a Deputy in Kallang Shipping v AXA [2009] 1 Lloyd's Rep 124 ('Kallang No 2') who, following a detailed review of the authorities including The Lisboa and a consideration of the Arrest Convention 1952, had said:

‘.. the English Court will not restrain a party to an English arbitration clause from arresting a vessel in another jurisdiction where the sole purpose of the arrest is to obtain reasonable security for the claim to be arbitrated or litigated in England. Section 11 of the Arbitration Act 1996 also assumes that a claimant can properly arrest a vessel in order to obtain security for an arbitration claim.’

Held: Where the claimant’s actions go beyond simply seeking reasonable security for the arbitration proceedings, there is a breach of the arbitration clause which the English Court will restrain by anti-suit injunction (although the precise basis on which the English Court acts, construction of the arbitration clause or discretion, is not authoritatively established, the general approach set out above is clear); The Kallang No 2 upheld. 

Whether the foreign proceedings impugned go beyond seeking reasonable security for the arbitration is a question of fact and analysis in each case.

Whether injunctive (or further injunctive) relief was necessary has to be determined by reference to the facts as they are the time of the hearing (as distinct from the prior breach), Proctor v Bayley CA (1889) 40 Ch D 390 (at 398 (Cotton LJ) and 401 (Fry LJ)), Kallang Shipping v Axa [2007] 1 Lloyd's Rep 160 (Kallang No 1), Green Flower Navigation Malta Ltd, Avin International Ltd v SC Santierul Naval SA Constanta  2002 WL 1876042 applied.

Given the possibility of staying the substantive proceedings in Nigeria, a new mandatory injunction to make the charterers discontinue the Nigerian proceedings as a whole would not be granted. However, the original order (ie the continuation of some form of negative relief to stop any further action other than to stay the current substantive Nigerian proceedings) would remain in place.