[2025] EWHC 1368 (Comm)

Parties to an agreement will often provide that one of them cannot sue certain categories of third parties, the concern frequently being that to permit them to do so would undermine the contractual allocation of risk because the liability of the third party might come to rest with the other contracting party. Perhaps one of the most complex clauses of this kind is the so-called “Himalaya” clause in contracts for the carriage of goods or persons by sea, named after the decision in Adler v Dickson (The Himalaya) [1955] 1 QB 158.Clauses of this kind are concerned with the issue of whether the third party should be capable of being sued at all, rather than the forum in which such a claim might be brought.

There are contexts in which the court has been prepared to construe an agreement not to sue one party as extending as a matter of construction to its servants or agents: most obviously, where two parties settle a dispute, and then one of the parties seeks to renew its claims against a servant or agent of the other party. This was the position in Starlight Shipping Company v Allianz Marine and Aviation Versicherungs AG (The Alexandros T) [2014] EWHC 3068 (Comm), in which there were two sets of settlement agreements arising from the same insurance casualty, one expressly referring to claims against the underwriters and their servants and agents, the other just to claims against underwriters. The Court held that the phrase “underwriters” in the release provisions in the latter settlement embraced the underwriters’ servants or agents, because the contrary conclusion would undermine the fundamental purpose of the settlement agreement (to draw a line under a particular dispute) by allowing claims which, if they succeeded, would ultimately be visited on a settling party ([51]-[52]).

In The Alexandros T, the court’s conclusion was driven by the effect of the alternative argument on the primary rights and obligations created by the contract. Where it is a clause which is ancillary to those main objects (in the sense used by Lord Diplock in Moschi v LEP Air Services [1973] AC 331, 350-51) which is said to have this effect, the argument is more challenging. In construing a contract, the court “starts from the assumption that in the absence of clear words the parties did not intend the contract to derogate from [their] normal rights and obligations” (Triple Point Technology Inc v PTT Public Co Ltd [2021] UKSC 29, [108] citing Modern Engineering (Bristol) Ltd v Gilbert-Ash (Northern) Ltd [1974] AC 679).

As between the parties to a dispute resolution agreement, the effect of agreeing a particular forum will frequently involve a contractual foregoing of the right to bring claims under causes of action recognised in other jurisdictions but not in the chosen forum. As Longmore LJ noted in Starlight Shipping Company v Allianz Marine and Aviation Versicherungs AG [2014] EWCA Civ 1010, [12] “the owners had promised to submit to the exclusive jurisdiction of the English courts and thus promised not to bring claims in other courts where such claims might (or might not) succeed”. Indeed this is often a desired rather than merely a collateral consequence of an exclusive forum agreement (Riverrock Securities Ltd v International Bank of St Petersburg [2020] EWHC 2483 (Comm), [61]).

Where, however, the contention is advanced that a dispute resolution agreement involves an agreement not to sue a third party in some other forum, the position is rather more complex, and there is potentially a distinction of significance between exclusive jurisdiction clauses (“EJCs”) and arbitration agreements, depending on how the obligation is formulated:

It should also be noted that there are numerous instances in which a claim will be brought in arbitration, and a connected claim against a third party in some other forum, without any suggestion that this involves a breach of the arbitration agreement. This is so where the contract with the principal debtor is subject to arbitration, but not the guarantee, and where it is necessary to prove the liability of the principal debtor as between the creditor/ beneficiary and the guarantor, with the guarantor having a claim against the debtor for the amount of its liability if called upon to pay. Or where an entity selling a company engages an agent to market it, with the sale contract being subject to arbitration, and a claim in tort is brought by the buyer against the agent in respect of pre-contractual statements, with the agent having a potential right of indemnity against the seller. Fact patterns of this kind raise issues of the sequencing of proceedings in the two fora (e.g. ACP v Sacyr SA [2017] EWHC 2228 (Comm) and Reichhold Norway Asa v Goldman Sachs International [2000] 1 WLR 173), but there is no suggestion that both claims cannot proceed.

This is the case even when there are claims against two parties in conspiracy, or on the basis that they are jointly and severally liable for the same loss. Thus in Egiazaryan v OJSC OEK Finance [2015] EWHC 3252 (Comm), Burton J held that an arbitral tribunal had jurisdiction over a claim against one alleged conspirator, noting at [31] that “the fact that there may be outstanding claims against other parties arising out of the same facts is not an objection to the bringing of a claim which falls within the terms of an arbitration clause.” In VTB Commodities Trading DAC v JSC Antipinsky Refinery [2019] EWHC 3292 (Comm), [57], Teare J rejected the suggestion that arbitrators did not have jurisdiction over a conspiracy claim against one of the conspirators, noting:

“Counsel referred to the fact that MachinoImport and Sberbank were not party to the arbitration agreement and so any claim against them would have to be advanced elsewhere. That is true but the tortious, non-contractual claim brought against the Refinery for being party to an unlawful means conspiracy clearly arises out of or in connection with the pre-payment agreements and off-take contracts. The claim is therefore very clearly caught by the arbitration clause.”

Indeed Fiona Trust itself was a case in which claims in conspiracy and for joint and several liability were stayed under s.9 of the Arbitration Act 1996 as against some conspirators, while proceedings in this court continued against the others.

Once again, the fact that proceedings in respect of the same alleged conspiracy may be proceeding against one conspirator in arbitration and against another in court proceedings is managed, if at all, by the sequencing of proceedings through a temporary stay, rather than holding that the arbitration agreement involves an implied promise not to pursue a party alleged to be jointly and severally liable with the arbitrating party in another forum. Even then, the court will readily countenance the simultaneous pursuit of the claims. For example in Mabey and Johnson Ltd v Danos [2007] EWHC 1094 (Ch), Henderson J observed at [37];

“I accept Mr Johnson's submissions, and have come to the clear conclusion that it would be wrong to grant the stay requested. In reaching this conclusion I am influenced in particular by the desirability of a single trial taking place, in public, at which the strong prima facie case of fraud and conspiracy against the three human defendants can be fully investigated and determined. DAG's invocation of the arbitration clause, presumably at the instance of Mr Gibson, has prevented the claim against DAG from being determined in the same forum as the claim against Mr Gibson. DAG is fully entitled to take that step, but I can see no good reason why Mr Gibson too should be permitted to take advantage of the arbitration clause, or to hold up the English action while the arbitration proceeds.”