CA-2025-000131 - [2025] EWCA Civ 928

The Judgment

The Judge considered at [4] that there were three critical questions to be resolved: first, the allocation of jurisdiction under the New York Convention, second, what in substance the application in Pakistan is seeking to achieve and third, whether it is in any event appropriate for the English courts to intervene by way of anti-suit injunction.

On the first question, the Judge started with the following observation:

…the parties to the New York Convention have necessarily agreed that an award made in one contracting state can, and indeed must, be recognised and enforced in any other contracting state, and that those other contracting states have undertaken a binding obligation to recognise and enforce awards made in accordance with the Convention when asked to do so. It seems to me that it must therefore be assumed that the Court which is being asked to recognise or enforce an award, whether in whole or in part, will comply with its international obligations and do so only in accordance with the provisions of the Convention. The English courts have no policing role in this respect.”

At [7] the Judge stated that a losing party was not bound to bring any jurisdictional or other challenge in the court of the seat, but was entitled to wait until the winning party seeks to enforce or recognise the award, and then resist on the grounds set out in Article V of the New York Convention, a substantive right under the Convention.

The Judge then rejected SHPL’s argument that the losing party could not make a challenge pre-emptively, stating as follows:

…As I have said, it seems to me that there is a substantive right under the Convention for awards not to be recognised or enforced on the grounds set out in Article V. That being the case, I see no reason of principle why that right cannot be asserted pre-emptively in a particular jurisdiction. This may not be commonly done but there may be any number of reasons why a respondent might want to seek a declaration of non-recognition or non-enforceability, for example on public policy grounds, even if the winning party was showing no immediate signs of seeking to bring recognition or enforcement proceedings of its own. There is nothing in the wording of the Convention itself to limit the right to seek recognition and enforcement to one party or another and, of course, it is not possible to analyse the situation simply in terms of a winning or a losing party because both parties might be winners on some issues and losers on others.

None of the authorities referred to by [SHPL] preclude the possibility of a pre-emptive application. Indeed in none of them, so far as I can see, does the question arise. And I can see nothing to suggest as a matter of principle that if there is a right to challenge recognition or enforcement of an award on certain grounds, such as public policy or non- arbitrability, the party wishing to make such a challenge has to wait until such time as recognition or enforcement is sought by the other party, when it may be suffering adverse consequences immediately. I therefore accept that a pre-emptive application is permissible and is not improper in and of itself.”

At [10] the Judge accepted that it is in principle permissible to seek recognition and/or enforcement of part of an award and noted that SHPL did not dispute this.

The Judge then turned to the second question, noting that SHPL contended that the Lahore proceedings had nothing whatsoever to do with recognition and enforcement but were rather a root and branch attack on the award. The Judge rejected that contention in the following terms:

Turning then to the substance of the application, [SHPL] argued strenuously that in truth the application had nothing whatsoever to do with recognition or enforcement but was rather a root and branch attack on the award seeking to undermine its reasoning. However, it could be said that any party who resists recognition or enforcement on grounds that the arbitrator had no jurisdiction or because the award was contrary to public policy, or raised non-arbitrable issues, is similarly trying to undermine the award. That, it seems to me, is simply the necessary consequence of permitting challenges to be made on the grounds set out in Article V. But in any event, looking at paragraph 377 of the award, which is the lynchpin of [NTDCL’s] application in Pakistan, it seems to me that this is a determination by the arbitrator of which recognition can properly and legitimately be sought by [NTDCL].

I can certainly see that there is an argument to be had as to the extent to which recognition of paragraph 377 necessarily entails that paragraph 514(d), in particular, is not enforceable. There are arguments both ways. But it is not for me, at least not on an interlocutory application, to determine the matter unless it is so obviously clear one way or the other. But I do not find that to be the case here. What is true, it seems to me, is that [NTDCL] is not seeking, in fact, to undermine the award in any truly fundamental way. It remains open to [SHPL] to enforce the award in any other jurisdiction they choose. The argument of the Respondents here is that the determination in paragraph 377 has the consequence that other determinations made by the arbitrator are either contrary to Pakistani law and public policy, or were determinations on issues which were, in fact, non-arbitrable. Either way, they say, if they are right about that, then they cannot be recognised and enforced. As I say [NTDCL] may be right or it may be wrong about that, but that is an argument which to my mind should be played out before the Lahore court, and it is not for the English court to intervene.”

On the third question, that of discretion and comity, at [14] the Judge considered that in the circumstances it would be wholly wrong for the English court to arrogate to itself the power to determine what issues should and should not be left to the Pakistani courts. The Judge considered that comity demands that the English court assumes that the Pakistani courts will abide by their international obligations and will determine [NTDCL’s] application there on its merits in accordance with the Convention.

The Judge finally noted that she was also satisfied that this is not a case of vexatious or oppressive behaviour by NTDCL.