Norton Rose secures Court of Appeal win over Lithuanian govt

Norton Rose has triumphed in a Court of Appeal spat over the enforcement of an arbitration award against the Lithuanian government.

The firm was acting for Swedish energy giant Svenska Petroleum Exploration in its dispute with Lithuania over a 1993 joint venture agreement to exploit Lithuania’s oil reserves.

A contract was signed between Svenska and Lithuanian state-owned company Geonafta, with the government of Lithuania brought in to approve the agreement.

However, a dispute arose between Svenska and Geonafta over the exploration of the oil reserves, prompting a 2002 arbitration hearing in Copenhagen. The Danish arbitration panel found in favour of Svenska, holding both Geonafta and the Lithuanian government liable to the tune of $12.6m (£6.65m).

The case came to the English courts when Svenska sought to have the award enforced. But the Lithuanian government said it had state immunity from paying the award, a claim that Mrs Justice Gloster disagreed with in November 2005.

Lithuania appealed to the Court of Appeal, but its case was again thrown out by a decision of the Master of the Rolls, Sir Anthony Clarke, and Lord Justices Scott Baker and Moore-Bick. The court found that Lithuania could not use the State Immunity Act 1978 to protect itself from enforcement of the award.

The court awarded Svenska interest and costs in addition to the damages.

Norton Rose partner Neil Q Miller, assisted by Charlotte Knapper and Claire Longbottom, acted for Svenska, with Brick Court Chambers’ Mike Bools as counsel.

Eversheds partner and solicitor-advocate Stewart Shackleton and Tanfield Chambers’ David Holloway represented the government and Geonafta.