MFB European arbitration win scuppers reach of English courts

London’s position as a leading arbitration centre has been dealt a blow following an MFB Solicitors victory in the European Court of Justice (ECJ).

The ECJ ruling in West Tankers Inc v RAS Riunione Adriatica di Sicurta SpA & ors (2009) states that ­English courts cannot stop legal proceedings in another EU member state, even if the proceedings are in breach of an arbitration agreement.

The case concerned the collision of a ship with a jetty in Italian waters. The vessel’s insurers, Allianz SpA, made a damages claim in Sicily despite its contract with West Tankers stipulating that arbitration should be brought in the UK.

West Tankers sought an anti-suit injunction in the High Court to stop the claim going ahead in Sicily.

After an initial victory for West Tankers, Allianz appealed, saying the injunction was incompatible with a ;Brussels ;regulation ­allocating jurisdiction.

The ECJ rejected the use of anti-suit injunctions and ruled that it should be up to the Italian court to decide whether it had jurisdiction.

Ian Chetwood from Ince & Co advised West Tankers, instructing Timothy Brenton QC and David Bailey QC of 7 King’s Bench Walk.

Allianz was advised by MFB partner Edward Gray, instructing Stephen Males QC of 20 Essex Street.