CA-2024-002477 - [2025] EWCA Civ 1054

The 2003 Deed of Indemnity provided for arbitration in the following terms (I have emphasised the words in clause 14.2(b) which are of particular importance):

‘14.2 Arbitration

(a)

Failing such amicable settlement as provided for in Clause 14.1, any dispute arising out of or in connection with this Deed, including any question regarding its existence, validity or termination, interpretation, application, performance or non-performance shall be referred to and finally resolved by arbitration in The London Court of International Arbitration, England by a tribunal of three (3) arbitrators in accordance with the LCIA Arbitration Rules applicable to arbitration for the time being in force which rules are deemed to be incorporated by reference in this Clause 14.2, provided however that the Parties may agree in writing to refer any disputes to binding arbitration before a single arbitrator.

(b)

The arbitration tribunal shall be appointed by mutual agreement of the Parties in dispute, and failing agreement, pursuant to the LCIA Arbitration Rules. The arbitration tribunal shall conduct its session and render its decision in English. The decision of the arbitration tribunal shall be final and binding upon the Parties and may be used as a basis for judgment thereon in any state or legal jurisdiction. Such decision shall include a determination as to how the costs of the arbitration proceedings shall be borne by the parties in dispute.

(c)

The arbitration tribunal shall have the power to issue such orders for interim relief pending its final decision as may be necessary to preserve the rights of the Parties, without prejudice to the final determination of the dispute. The arbitration tribunal shall also have authority in its final decision to direct the specific performance of the obligations of the parties under this deed as well as to grant any other relief whether legal or equitable in nature. However, the arbitration tribunal shall not have power to alter, modify or reform any express provision of this Deed or to make any award which by its terms affects any such alteration, modification or reforming.’

The LCIA Rules pursuant to which the arbitration was conducted were the 2020 Rules as those were the rules in force when the arbitration was commenced. At the time of the 2003 Deed of Indemnity, however, the current rules were the 1998 Rules and it is those rules, so far as relevant, that the parties would have had in mind when making their agreement.

The 2003 Deed of Indemnity dealt specifically with appeals and other applications to the court in clause 14.3 (again, I have emphasised the words of particular importance):

‘Appeal

(a)

In the event that the arbitration tribunal has materially erred in fact and/or law, the Parties are entitled to appeal the decision of the arbitration tribunal to a court in England, provided that such appeal is brought within thirty (30) days after the decision is rendered.

(b)

The Parties shall not be entitled to commence or maintain any action in any court of law upon any matter in dispute arising out of this Deed except for the enforcement of an arbitral award granted pursuant to this Clause 14. For avoidance of doubt, the parties expressly waive all rights to make an application or to appeal to the English courts under the Arbitration Act, except pursuant to Clause 14.3(a) above.

(c)

Judgment upon any award rendered in an arbitration hereunder may be entered in any court of competent jurisdiction, including without limitation the courts of the canton of Geneva, Switzerland, and the BVI. For avoidance of doubt, for the purposes of this Clause 14.3(c), each of the Parties hereby irrevocably submits to the jurisdiction of such courts and waives any objections or defences which it may have now or hereafter to such jurisdiction.’

As Mr Simon Davenport KC submitted on behalf of Mr Eronat, clause 14.3 appears to reflect an intention by the parties to provide wide and permissive scope for an appeal to the court. However, clause 14.3(a) goes further than is legally possible, because it is not possible to confer jurisdiction on the English court by agreement to decide an appeal from arbitrators on a question of fact (Mustill & Boyd, Commercial and Investor State Arbitration, 3^rd Ed (2024), para 14.130), while clause 14.3(b) is ineffective to the extent that it seeks to exclude the possibility of a challenge to an award under section 67 (jurisdiction) or section 68 (serious irregularity) of the 1996 Act, because those sections are mandatory and cannot be excluded by agreement.