Garthon Business Inc., et al., Respondents,v.Kirill Ace Stein, et al., Appellants.

Brief

N.Y.September 12, 2017

To Be Argued By: JASON A. GROSSMAN Time Requested: 30 Minutes APL-2016-00097 New York County Clerk’s Index No. 653715/14 Court of Appeals STATE OF NEW YORK GARTHON BUSINESS INC. and CRESTGUARD LIMITED, Plaintiffs-Respondents, —against— KIRILL ACE STEIN and AURDELEY ENTERPRISES LIMITED, Defendants-Appellants. ADDENDUM TO REPLY BRIEF FOR DEFENDANT-APPELLANT KIRILL ACE STEIN d JASON A. GROSSMAN GADDI GOREN TUREK ROTH GROSSMAN LLP 377 Fifth Avenue, 6th Floor New York, New York 10016 Telephone: (212) 223-3562 Facsimile: (212) 223-3614 Attorneys for Defendant-Appellant Kirill Ace Stein December 22, 2016 Neutral Citation Number: j"2009] EWHC l (Comm) IN THE HIGH COURT OF JUSTICE QUEEN'S BENCH DIVISION COMMERCIAL COURT Before: Mr. Justice Teare Between: JOHN FORSTER EMMOTT -and- Case No: 2008 Folio 1300 Case No: 2008 Folio 1308 Royal Courts of Justice Strand, London, WC2A 2LL Date: 12/01/2009 Chtimant MICHAEL WILSON & PARTNERS LIMITED Defendant MICHAEL WILSON & PARTNERS LIMITED -and- JOHN FORSTER EMMOTT Claimant Defendant Philip Shepherd QC and Steven Thompson (instructed by Michael Robinson) for John Forster Emmott Anthony Boswood QC, Joseph Carney and Anna Dilnot (instructed by Holman Fenwick and Willan) for Michael Wilson & Partners Limited Hearing dates: 17 December 2008 Judgment Mr. Justice Teare: 1. There are two applications before the Court which have been brought by the Claimant, Mr. Emmott. The first, pursuant to section 42 of the Arbitration Act 1996, is for an order requiring the Respondent ("MWP") to comply with a peremptory order made by an arbitration tribunal. The application is made with the permission of the tribunal and upon notice to MWP. The second, pursuant to section 44 of the Arbitration Act 1996, is for a freezing order. That application is also made with the permission of the tribunal and upon notice to MWP. There is also an application before the Court which has been brought by MWP, pursuant to section 67 of the Arbitration Act, challenging an award of the arbitration tribunal as to its substantive jurisdiction. 2. The court heard the applications on 17 December 2008. The argument was not finished until 5pm. Although counsel for Mr. Emmott hoped that the court would be able to give judgment on the application on the last day of term, 19 December, that was not possible because of my judicial commitments on 18 and 19 December. On 22 December 2008 I informed counsel that I had decided to grant the relief sought by Mr. Emmott and to refuse the relief sought by MWP. These are the reasons for my decisions. 3. MWP, a company incorporated in the British Virgin Islands, provides legal services in Kazakhstan. Mr. Michael Wilson is a director and was (at least until 23 February 2008) a shareholder of MWP. Mr. Emmott was a partner in the English firm of solicitors, Richards Butler. By an Agreement dated 7 December 2001 between MWP and Mr. Emmott it was agreed that Mr. Emmott would join MWP as a director and shareholder. Their strategy was to create the leading independent legal and business consultancy in Kazakhstan. It was agreed that in effect MWP and Mr. Emmott would function and operate as a quasi-partnership and that the parties would have and observe the usual partnership obligations and duties to each other. Mr. Emmott was to have a 33% profit sharing interest and, after contributing £225,000, was entitled to receive a 33% shareholding in MWP. Clause 5.2 provided as follows: "This Agreement shall be governed by and interpreted in accordance with the laws of England and Wales and all and any disputes shall be referred to and subject to arbitration in London before a tribunal of three arbitrators with one arbitrator to be appointed by each Party and the chairman of the tribunal to be appointed by the president ofthe Law Society." 4. An arbitration was commenced by MWP pursuant to the provisions of clause 5.2 in August 2006. Mr. Emmott counterclaimed against MWP. The arbitration hearing commenced on 10 November 2008. It was adjourned on 28 November 2008 and will resume on 13 January 2009. The arbitrators are Mr. Christopher Berry, Lord Millett and Ms. Val Davies. Before the hearing was adjourned the tribunal had heard evidence from Mr. Wilson and from Mr. Emmott. The procedura l histmy 5. The peremptory order which forms the subject of Mr. Emmott's application pursuant to section 42 of the Arbitration Act concerns what have been described as "the Steppe shares". They are 9,930,000 shares in Steppe Cement, a company registered in Labuan, Malaysia and listed in London on the AIM. Mr. Emmott says that these shares were acquired by MWP in lieu of fees owed to MWP. He counterclaims 33% of the shares in MWP. The Steppe shares are a component of the value of the shares in MWP. By way of an amendment to his counterclaim he claims 27% of the Steppe shares pursuant to an agreement alleged to have been made in February 2005. Mr. Emmott says that the agreement reflected the fact that when he joined MWP in 2002 part of the legal work which generated the fees in lieu of which the Steppe shares were provided had been done before he had joined MWP. 6. The peremptory order was made by the tribunal on 27 November 2008. It has a long history. By its 81h Procedural Order on 26 September 2008 the tribunal made a number of orders one of which was: "That [MWP] is directed (a) to procure that its 27% shareholding in 9,930,000 Steppe shares, which is held according to the oral evidence of Mr. Wilson, nominally by HSBC Global Custody Nominees (UK) Limited (HSBC) is to be held to the order of Christopher Berry, the Chairman of the Arbitral Panel and (b) to confirm in writing to the Arbitrators that such instructions have been accepted by HSBC." 7. The time for compliance was 10 October 4pm. The reasons for the tribunal's order with regard to the Steppe shares was described as follows: "A central issue in this Arbitration surrounds the 9,930,000 Steppe shares. It is only their value (at one time around £30m. and now at least £15m.) which can have justified the vast amount of legal cost expended by the Claimant in various jurisdictions and in various applications in this jurisdiction. This is so whether or not the Respondent's new proprietary claim to 27% of the Claimant's Steppe shareholding is successful. Nevertheless, Mr. Wilson of the Claimants expressly refused, before the Arbitrators, to disclose how 73% of the Steppe shareholding is held. He informed the Arbitrators that all the Steppe shares are pledged either to HSBC or Kazholdings Incorporated "KH1". In relation to KHI he was unable to tell the Arbitrators the extent of the Claimant's liability, save that it was "north of $5m." He said that he was associated with KHI but he expressly refused to explain who are the beneficial owners and ultimate controllers of that company. Accordingly there must be real susp1c1on that Mr. Wilson declines to provide information so as to ''protect" the Claimant's Steppe shareholding from the consequences of any Order the Respondent may obtain in the Arbitration." 8. MWP provided to the ttibunal certain correspondence apparently passing between MWP and Kazholdings Incorporated ("KHI"). 9. Counsel for Mr. Emmott told me that Mr. Wilson controlled KHI. That appeared to be based upon a number of matters. In particular, Mr. Wilson had told the tribunal that he was associated with KHI but refused to say who were the beneficial owners and ultimate controllers. Further, as noted by Mr. Emmott's solicitor in his witness statement dated 11 December 2008, Mr. Wilson has referred to KHI as "my other entity" and has referred to loans from KHI to MWP as "my generous personal advances". Mr. Wilson has stated in his witness statement dated 16 December 2008 that he is not a director, officer or shareholder of KHI. He has said that KHI is not a vehicle for and creature of MWP and that whilst he "may indirectly have some knowledge of its affairs and ability to express an opinion on its decisions, that has nothing to with MWP." Mr. Wilson's statement did not explain what his relationship with KHI was and so I asked MWP's counsel what it was. I was told that Mr. Wilson had "some ultimate control over it" but was later told by counsel that his instructions were that Mr. Wilson "does not control KHI". It seems to me that there is a very strong case that, as counsel for Mr. Emmott told me, Mr. Wilson controls KHI. This should be borne in mind when reading the correspondence between MWP and KHI. 10. By a letter dated 6 October 2008 MWP requested KHI to arrange for the "residual net interest" in relation to 27% of the Steppe shares to be held to the order of the chairman of the tribunal. It is to be noted that although Mr. Wilson had told the tribunal that the shares were pledged either to KHI or HSBC there was no letter written on or about 6 October 2008 to HSBC. 11. By a letter dated 9 October 2008 KHI required confirmation from MWP that the chairman would hold the shares subject to the prior rights of KHI and HSBC and that the tribunal would not seek to interfere with or render unenforceable those rights. It was said that 27% of the Steppe shares were held in the name of HSBC Global Custody Nominees (UK) Limited in account no. 932601. A copy of a document from Compushare, the registrar of shares in Steppe Cement, appeared to show that a larger number of shares were held in that account. Agreements between KHI and MWP were also exhibited including a fixed and floating charge and a loan agreement signed on behalfofKHI by Mr. Wilson's wife. 12. By a letter dated 10 October 2008 KHI informed MWP that legal advice had been taken and that it was considered that MWP would be in breach of a number of agreements if it were to allow 27% of the Steppe shares to be held to the order of the chairman of the tribunal. KHI said that it was prepared to consider providing the required consent but only on written confirmation by the chairman that the shares were held subject to all existing rights and by HSBC that it consents. 13. By a letter dated 28 October 2008 KHI wrote to HSBC Private Bank (Jersey) Limited requesting their agreement to holding the Steppe shares registered in the name of the bank's nominee to the order of the chairman of the tribunal. 14. The arbitration hearing began on 10 November 2008. The tribunal made a 101h Procedural Order that day. They recorded that they had been informed that MWP had made and was continuing to make efforts to comply with the 81h Procedural Order relating to the Steppe shares. Mr. Emmott sought a peremptory order. The tribunal decided to issue a fresh order reflecting changes which had been made in correspondence as follows: "That by 4.30 pm on Friday 14 November 2008, the Claimant must take all steps within its power to procure a letter from HSBC to the Tribunal agreeing that it holds all the Claimants' shares in Steppe to the order of the Tribunal, subject to any outstanding charges in favour ofHSBC or any third party." 15. An ll 1h Procedural Order was made on 20 November 2008. The tribunal noted that MWP had provided the tribunal with no evidence of what approaches, written or otherwise, had been made to HSBC Global Custody Nominees (UK) Limited, despite the fact that the original Order in relation to the manner in which 27% of the Steppe shares should be held had been made on 26 September 2008. The tribunal stated that the 1 O'h Procedural Order had not been complied with and, following representations by Leading Counsel for MWP, reinstated the order made in the 81h Procedural Order as follows: "The Claimant is directed (a) to procure that its 27% shareholding in 9,930,000 Steppe shares, which is held according to the oral evidence of Mr. Wilson, nominally by HSBC Global Custody Nominees (UK) Limited (HSBC) is to be held to the order of Christopher Berry, the Chairman of the Arbitral Panel and (b) to confirm in writing to the Arbitrators that such instructions have been accepted by HSBC. This Order is to be complied with by 21 November 2008." 16. By letter dated 26 November 2008 HSBC Private Bank wrote to KHI saying that that it was unable to consider the requests "in the absence of instructions to do so". 17. On 27 November 2008 the tribunal made its l21h Procedural Order. Counsel for Mr. Emmott had renewed his application for a peremptory order. Leading Counsel for MWP opposed the application on several grounds. In particular it was said that section 38( 4) of the Arbitration Act 1996 did not give the tribunal power to make the order; that the strength of Mr. Emmott' s claim to the Steppe shares was non-existent and that the balance of convenience was against the making of the order given that MWP was a trading company which could meet any award made against it and that Mr. Emmott may have no available assets and had admitted "serious defalcations" in his evidence. 18. The tribunal was evidently not persuaded by these arguments for it decided that it was appropriate to make the peremptory order which had been sought. It repeated the order it had made on 26 September and 20 November but did so " in peremptory terms, to be complied with by 4.30pm on Friday 5 December 2008." The tribunal referred to the reasons given in support of the order made on 26 September and added the following: "It is appropriate, in our view, to make the Order in peremptory terms. The Steppe shares fonn the most valuable asset of the Claimant company on the evidence before us. Mr. Emmott claims not only the Steppe shares but also a 33% shareholding of the issued share capital of the Claimant. Mr. Wilson of the Claimant has been evasive in his evidence before us concerning the manner in which the Claimant's own share capital has been dealt with and we have taken the view that it has been perfectly within Mr. Wilson's influence or control to bring about a situation in which the Steppe shares are secured as we have directed. We have made it clear throughout that we accept that such shares should be held to our order subject to all existing liabilities secured on them. The Claimant has not suggested that it is put under any disadvantage by ensuring compliance with our Order." 19. It is clear from that order and the reasons for it that the tribunal did not view the correspondence between MWP and KHI as a reason why Mr. Wilson was unable to bring about the securing of the shares in the manner required by the tribunal. The tribunal had had the benefit of hearing Mr. Wilson give evidence which I have not. It seems likely that the tribunal regarded Mr. Wilson as being in control ofKHI. 20. I was informed by counsel for Mr. Emmott that it was made clear on 27 November 2008 that Mr. Emmott would apply in writing for permission to seek an order pursuant to section 42 of the Arbitration Act as soon as the time for compliance had expired. A transcript of the hearing to which I was referred showed that counsel for MWP stated that "we" would wish to make submissions to the tribunal on that matter. 21. By a letter dated 1 December 2008 MWP wrote to KHI attaching copies of the 11th and 121h Procedural Orders and asking KHI to procure compliance with the peremptory order. 22. By a letter dated 5 December 2008 KHI informed MWP that KHI could not accede to the request because ''this is clearly not in our best interests, and also for the important reasons set out in the HSBC letter." 23. At 1700 on 5 December 2008 Mr. Emmott's solicitor wrote to the tribunal seeking its permission to make an application under section 42 of the Arbitration Act. 24. At 1711 MWP's solicitor sent an e-mail to the tribunal attaching the above correspondence between MWP, KHI and HSBC Private Bank dated 26 November, 1 December and 5 December 2008. 25. At 1139 on 8 December 2008 MWP's solicitors sent an e-mail to the tribunal stating that they were preparing a written response. 26. At 1144 on 8 December 2008 the tribunal e-mailed its 13th Procedural Order. That order noted that the 12th Procedural Order had to be complied with by 5 December 2008 and said: "That Order not being complied with and the Claimant having indicated, by its solicitors' e-mail of 5 December 2008, with its annexures, that it is not in a position to comply with the Order, the Arbitrators now, and hereby, give the Respondent permission, pursuant to s.42 of the Arbitration Act, to apply to the Court for such Order as the Court may see fit to ensure compliance with the Arbitrators' peremptory Order." 27. It is to be observed that in granting that permission the tribunal did so in full knowledge of what HSBC Private Bank and KHI had said on 26 November and 5 December 2008. The tribunal must have thought that such statements did not provide a good reason for MWP not complying with the peremptory order. 28. The application for an order pursuant to section 42 of the Arbitration Act 1996 was issued on 11 December 2008. 29. On 12 December 2008 MWP's solicitor asked the tribunal whether the members of the tribunal had read the solicitor's e-mail timed at 1139 on 8 December. 30. On 15 December 2008 the chairman of the tribunal replied stating that the tribunal had seen the solicitors' e-mail of 5 December attaching correspondence but had not seen the e-mail timed at 1139 before despatch of the 131h Procedural Order. 31. I was informed by counsel that both KHI and HSBC were given notice of the application for an order pursuant to section 42 of the Arbitration Act 1996. The challenge to the jurisdicti.on of the tribunal under section 67 of the Arbitration Act 1996 32. Counsel for MWP submitted that the tribunal had no jurisdiction in respect of the 2005 agreement concerning 27% of the Steppe shares. He had made the same submission before the tribunal. By an award dated 19 November 2008 the tribunal held that it had jurisdiction. MWP challenged that award pursuant to section 67 of the Arbitration Act. 33. I shall deal with MWP's challenge to the jurisdiction but I am not persuaded that, even if succeeded, it would undermine the peremptory order. Mr. Emmott counterclaims a 33% interest in MWP shares. The Steppe shares must be a major part of the value of those shares and so the peremptory order can be supported as an order in support of that counterclaim. This is reflected in the reasons given by the tribunal for its order made on 26 September: "This is so whether or not the Respondent's new proprietary claim to 27% of the Claimant's Steppe shareholding is successful." 34. The agreement dated 7 December 2001 between Mr. Emmott and MWP has a wide scope. It provides for Mr. Emmott to join MWP as a director and shareholder; clause 1.1. It also provides for Mr. Emmott and MWP to have a business relationship and association; clause 1.2. Finally, it states that the parties have agreed that "in effect" MWP will function and operate as a quasi-Partnership between them and the Parties shall have and observe the usual partnership obligations and duties to each other; clause 1.4. 35. The arbitration clause is expressed in wide terms: "all and any disputes shall be referred to and subject to arbitration in London before a tribunal of three arbitrators." 36. The principles governing the construction of arbitration clauses are now to be found in Fiona Trust v Privalov [2008] I Lloyd's Rep. 254. At paragraph 13 Lord Hoffmann said: "In my opinion the construction of an arbitration clause should start from the assumption that the parties, as rational businessmen, are likely to have intended any dispute arising out the relationship into which they have entered or purported to enter to be decided by the same tribunal. The clause should be construed in accordance with this presumption unless the language makes it clear that certain questions were intended to be excluded from the arbitrators' jurisdiction." 37. Mr. Emmott's case is that the Steppe shares were received by MWP in lieu of fees owed to MWP, that some of the work which generated those fees was done before he joined MWP and that the agreement he alleges was reached in 2005 was to resolve the question of to what, in those circumstances, his entitlement to a 33% profit sharing interest in MWP fees entitled him with regard to the Steppe shares. 38. Thus, not only is the 2001 agreement a part of the background or factual matrix relevant to the construction of the alleged 2005 agreement but, on Mr. Emmott's case, it also explains why MWP agreed to Mr. Emmott having 27% of the Steppe shares. The counterclaim based on the alleged 2005 agreement therefore arises out of the relationship between Mr. Emmott and MWP into which they entered by reason of the 2001 agreement. 39. Applying Lord Hoffmann's assumption Mr. Emmott and MWP are likely to have intended that the counterclaim would be determined by the tribunal appointed pursuant to the 2001 agreement. The next stage of Lord Hoffmann's approach to the construction of arbitration clauses is to see whether there is anything in the language of the clause which makes it clear that the counterclaim was intended to be excluded from the arbitrator's jurisdiction. There are no such words. 40. Thus, applying Lord Hoffmann's approach to the construction of arbitration clauses, the tribunal has jurisdiction in respect of the counterclaim to 27% of the Steppe shares. 41. Counsel for MWP submitted that that conclusion would be wrong. He said that the 200 l agreement was a bipartite agreement (between Mr. Emmott and MWP) whilst the alleged 2005 agreement was a tripartite agreement (between MWP, Mr. Wilson and Mr. Emmott), that the counterclaim therefore arises out of a subsequent and different contract from the 2001 agreement, that there is nothing in the 2001 agreement which entitled Mr. Emmott to take divisible profits of MWP in specie, whether in the form of Steppe shares or anything else, and that the alleged 2005 agreement was therefore free standing. 42. I am not persuaded that the 2001 agreement was in substance a bipartite and not a tripartite agreement. It is true that in form the 2001 agreement is between Mr. Emmott and MWP. But in substance it is of wider scope than that. One aspect of that wider scope is that, pursuant to its terms, Mr. Emmott becomes entitled to a 33% shareholding in MWP. That requires the consent of the shareholders of MWP. Clause 2.3 expressly stated that "MWP and its shareholders shall cause the necessary shares to be issued or transferred to Mr. Emmott or his nominee" (emphasis added). 43. Nor am I persuaded that the counterclaim in substance arises out of a subsequent and different contract from the 2001 agreement and so is a free standing agreement. It is true that in form the 2001 agreement does not entitle Mr. Emmott to 27% of the Steppe shares whilst the alleged 2005 agreement does. But the reason that Mr. Wilson was, it is alleged, willing to agree that Mr. Emmott should have 27% of the Steppe shares is that under the 2001 agreement he was entitled to a 33% profit sharing interest in MWP and the Steppe shares had been received in lieu of fees owed to MWP, though in part for work done before Mr. Emmott joined MWP. Thus in substance the counterclaim arises out of the 2001 agreement. 44. It was said that analytically the 2005 agreement is no different from an agreement in 2005 for the purchase of a used car by Mr. Emmott from MWP. I assume that the hypothetical used car was not to be used in the course of the relationship and association created by the 2001 agreement. But even so I do not regard the used car purchase as being analogous to the 2005 agreement. The explanation for the transfer of the used car is the purchase price agreed to be paid by Mr. Emmott in 2005. But the explanation for the transfer of 27% of the Steppe shares is Mr. Emmott's entitlement under the 2001 agreement to a 33% profit sharing interest in MWP. 45. For these reasons I consider that the tribunal was correct to conclude that it had jurisdiction in respect of the alleged 2005 agreement. I must therefore dismiss MWP's challenge to the jurisdiction of the arbitrators. Tbe application under Section 42 of the Arbitration Act 1996 46. Section 42(1) provides that "the court may make an order requiring a party to comply with a peremptory order made by the tribunal." A party seeking such an order required the permission of the tribunal; section 42(2)(b ). Certain conditions must be satisfied before the court may exercise the power. The applicant must have exhausted any available arbitral process in respect of failure to comply with the tribunal's order; section 42(3). The person to whom the tribunal's order was directed must have failed to comply with it within the time specified; section 42(4). 47. It was submitted in writing on behalf of Mr. Emmott that the proper approach of the court to the exercise of its power or discretion under section 42 of the Arbitration Act 1996 is to enforce a peremptory order save in an exceptional case. In oral submissions the submission was put a little differently. It was said that the court should only decline to enforce a peremptory order if the court is satisfied that the peremptory order falls outside the generous ambit of orders that a tribunal could properly make or where there has been a radical change of circumstances such that it would be unjust for the court to make the requested order. In support of those submissions it was said that judicial interference with the arbitral process should be kept to a minimum, that the proper role of the court is to support the arbitral process rather than to review it and that the circumstances in which the comt can properly inte1fere with or review the arbitral process are limited to those within sections 67-69 of the Arbitration Act 1996 (challenges to the substantive jurisdiction of the arbitral tribunal, challenges based upon a serious irregularity and appeals on points oflaw). 48. By contrast it was submitted on behalf of MWP that the court must in every case satisfy itself that the case is a proper one for the order which is sought; it must not regard itself as a mere "rubber stamp" in respect of orders made by the tribunal. Thus, in the present case the court itself must be satisfied that MWP can perform that which the tribunal has ordered MWP to perform. In support of that submission reliance was placed on the circumstance that the making of the order had potentially senous consequences for MWP because penalties for contempt would be available. 49. In my judgment the dispute revealed by these contrasting submissions is to be resolved by having regard to the General Principles set out in section 1 of the Arbitration Act 1996, to the duties of the tribunal in section 33 of the Act and to the duties of the parties in section 40 of the Act. Those three sections have been described in the 2001 Companion Volume to Commercial Arbitration by Mustill and Boyd 2nd ed. 2001 at pages 23-37 as "three pillars" of the Act. 50. Section 1 provides: "General Principles The provisions of this Part are founded on the following principles, and shall be construed accordingly- (a) the object of an arbitration is to obtain the fair resolution of disputes by an impartial tribunal without unnecessary delay or expense; (b) the parties should be free to agree how their disputes are resolved, subject only to such safeguards as are necessary in the public interest; (c) in matters governed by this Part the court should not intervene except as provided by this Part." 51. Section 33 provides: "General duty of the trihunal (1) The tribunal shall- (a) act fairly and impartially as between the parties, giving each party a reasonable opporttmity of putting his case and dealing with that of his opponent, and (b) adopt procedures suitable t the circumstances of the particular case, avoiding unnecessary delay or expense, so as to provide a fair means for the resolution of the matters falling to be determined. (2) The tribunal shall comply with that general duty in conducting the arbitral proceedings. In its decisions on matters of procedure and evidence and in the exercise of all other powers conferred on it." 52. Section 40 provides: "General duty of parties ( 1) the parties shall do all things necessary for the proper and expeditious conduct of the arbitral proceedings. (2) This includes- (a) complying without delay with any determination of the tribunal as to procedural or evidential matters, or with any order or directions of the tribunal, and (b) where appropriate, taking without delay any necessary steps to obtain a decision of the court on a preliminary question of jurisdiction or law (see sections 32 and 45). 53. Thus disputes between the parties to an arbitration agreement are to be resolved by the tribunal; section 1, general principle (a). The tribunal has a general duty to resolve such disputes fairly; section 33. One of its powers to assist it in so doing is conferred by section 38(4), namely, to give "directions in relation to any property which is the subject of the proceedings or as to which any question arises in the proceedings, and which is owned by or is in the possession of a party to the proceedings - for the inspection, photographing, preservation or custody or detention of property by the tribunal, an expert or a party". If such an order is made the party to whom it is directed has a general duty to comply with it; section 40. The court is exhorted by section 1, general principle (c), not to intervene in the arbitration save where permitted by the Act. If a party fails to comply with a peremptory order of the tribunal, the court is permitted to intervene in the arbitration by making an order that the party comply with the order; section 42. In the particular context of section 38(4) one would expect that the proper role of the court would be to support the tribunal by making the requested order. Indeed, more generally, given general principle (a) and the exhortation in general principle (c) one would expect the Court to support, rather than frustrate, the tribunal. 54. This approach is supported by the Report of the Departmental Advisory Committee on the Arbitration Bill when commenting upon general principle (c) at paragraphs 20- 22. "The limitation on the right of appeal to the Courts from awards brought into effect by the 1979 Arbitration Act, and changing attitudes generally, have meant that the courts nowadays generally only intervene in order to suppmt rather than displace the arbitral process. We are very much in favour of this modem approach and it seems to us that it should be enshrined as a principle in the Bill." 55. I infer that general principle (c) was intended to give effect to that approach . 56. That approach is also supported by Mustill and Boyd who observe that general principle (c) has been described as expressing the concept of "judicial minimalism"; see p.28 of the Companion Volume. "The principle is well recognised, and is an essential element in the scheme of the Act, as a counterpart to the wide powers entrusted to the arbitrator and the explicit encouragement to use them with boldness and imagination. Unnecessary meddling by the court both falsifies the trust which the legislature and the parties have placed in the arbitrator and discourages arbitrators from employing them boldly in the future. If the courts do not back up the arbitrator even when faced with the temptation to put right a procedural decision which it would itself have made differently the Act will be a failure." 57. To the same effect is an earlier passage at p.25. "The general principles, read with sections 33 and 40, will now require the courts to recognise that an arbitrator who has acted fairly but firmly is entitled to support; and this will in turn fortify the arbitrator to act resolutely without apprehension about needless meddling by the court." 58. I therefore accept the submission made on behalf of Mr. Emmott that judicial interference with the arbitral process should be kept to a minimum, that the proper role of the court is to support the arbitral process rather than review it and that the circumstances in which the court can properly interfere with or review the arbitral process are limited to those within sections 67-69 of the Arbitration Act 1996 (challenges to the substantive jurisdiction of the arbitral tribunal, challenges based upon a serious irregularity and appeals on points of law). 59. I also accept, as submitted on behalf of MWP, that section 42 confers a discretion upon the court and that it would be inconsistent with the existence of a discretion that the court should act as a rubber stamp on orders made by the tribunal. However, I do not accept that the court must in every case satisfy itself that the case is a proper one for the order which is sought if by that is meant that the court must review the decision made by the tribunal and consider whether the tribunal ought to have made the order in question. The reasons that I do not accept that submission are as follows: i) It is inconsistent with general principle (c) in the context of sections 33 and 40 of the Act. ii) The Act confers on the court limited powers to rehear or review decisions of the tribunal. It would be surprising if a power to rehear or review was hidden within section 42. iii) It is true that the making of an order under section 42 exposes the party against whom the order is made to being in contempt of court if he breaches the order. But that is the purpose of section 42. It may only be exercised when the arbitral process is exhausted and the party in question has failed to comply with a peremptory order. I am not persuaded that the exposure of that party to being in contempt of court requires the court to rehear or review the arbitrator's decision to grant the peremptory order. iv) Counsel relied on a passage in Merkin On Arbitration at paragraph 16-25: " ...... the court has a discretion under s.42 of the 1996 Act whether or not to make an order. Relevant factors will doubtless be the reasonableness of the requirements imposed by the arbitrators' peremptory order, and whether the court takes the view that the problem could be resolved by the arbitrators themselves in their approach to the arbitration" (emphasis added). If this passage is intended to mean that the court will routinely consider whether it would have made the order I do not consider that it is correct. 60. Counsel for MWP referred to the rights of KHI under charging and pledging agreements with MWP and to HSBC's general lien over KHI's property. It was submitted that having regard to those rights the basis upon which the tribunal had concluded that it is within MWP's power to do that which it had been ordered to do by the peremptory order is not apparent. That may be so in the sense that the tribunal has not set out in detail the reasoning which led to the conclusion it reached. But the tribunal clearly stated when making the peremptory order that "we have taken the view that it has been perfectly within Mr. Wilson's influence or control to bring about a situation in which the Steppe shares are secured as we have directed." 61. Counsel for MWP has submitted that the court should satisfy itself that it is within MWP's control to do that which it has been ordered to do. For the reasons I have given I do not consider that that is appropriate when the tribunal has reached a clear and firm view on that very matter. That is particularly so in circumstances where the tribunal has heard oral evidence from Mr. Wilson and the court has not. 62. In what circumstances then might a court decide not to make an order that a party comply with a peremptory order of the tribunal ? In general terms the answer to that question will be where such an order is not required in the interests of justice to assist the proper functioning of the arbitral process; see para.212 of the DAC report. This is not the occasion for a comprehensive list of such circumstances, even assuming it were possible to compile such a list. One example might be where there has been a material change of circumstances after the peremptory order was made. Another might be where the tribunal has not fulfilled its duty to act fairly and impartially between the parties in breach of its general duty to do so. Another might be where the tribunal has made an order which it had no power to make. 63. In the present case counsel for MWP did not suggest that there had been a material change of circumstances after the tribunal made the peremptory order. A witness statement from Mr. Wilson was submitted which had not been seen by the tribunal but it was not suggested that it evidenced a material change in circumstances. On the contrary it appeared to repeat much of what had been put before and considered by the tribunal. 64. Counsel did not suggest that the tribunal had breached its duty to act fairly and impartially in making the 81h, 101h, 11th and 121h Procedural Orders but he did suggest that the tribunal had acted unfairly in granting permission for this application. The basis of this submission was that although counsel for MWP had indicated that submissions would be made in the event that permission were sought the tribunal granted permission without hearing submissions on behalf of MWP. This appears to be factually correct but I am not persuaded that the tribunal acted unfairly. The tribunal granted permission on 8 December having been requested to do so in writing on 5 December and having received an e-mail from MWP's solicitors on 5 December attaching the most recent correspondence passing between MWP, KHI and HSBC. That e-mail did not say that representations would be made in addition. That was stated on 8 December after the tribunal had decided to grant permission. The correspondence produced on 5 December brought the tribunal up to date and the tribunal was entitled to assume, in circumstances where that correspondence had been brought to its attention by MWP's solicitors without those solicitors saying that further written submissions would be forthcoming, that the tribunal had considered all that MWP wished to put before it. The tribunal had heard detailed submissions before making the peremptory order on 27 November and it was not suggested to me that those representing Mr. Emmott were intending to make submissions which had not already been considered by the tribunal before making the peremptory order. 65. Counsel for MWP suggested that the tribunal had no power to make an order in respect of the Steppe shares pursuant to section 38(4) because the section applied only to physical property and that the order granted was not an order "for the inspection, photographing, preservation, custody or preservation of property". However, the Steppe shares are, in my judgment, property within the meaning of section 38(4) and the order made by the tribunal was for the preservation or custody of the Steppe shares. 66. Counsel for MWP further submitted that the court should refuse to make the order sought under section 42 on the grounds that there was no risk of the Steppe shares being dissipated, that the balance of convenience was in favour of refusing the order, that the claim in respect of the Steppe shares had no real prospect of success and that Mr. Emmott has now admitted misconduct which he had not disclosed before. I was informed that each of these submissions had been made before the tribunal. Risk of dissipation 67. It was said that because the Steppe shares were held by an HSBC nominee company as security for loans made by HSBC to KHI there was no risk that such shares might be dissipated. Furthermore the shares are the subject of an undertaking given to Tomlinson J. on 24 July 2007 that MWP will not dispose of, deal with, charge, assign or diminish the value of more than 73% of the shares that it currently holds in Steppe Cement Limited. That being so there was no justification for an order by the tribunal under section 38(4) or by the court under section 42 in support of an order under section 38(4). 68. The tribunal decided on 26 September 2008 that it was appropriate to make an order for the preservation or custody of 27% of the Steppe shares. It explained its reasons for so concluding. "Mr. Wilson of the Claimants expressly refused, before the Arbitrators, to disclose how 73% of the Steppe shareholding is held. He infonned the Arbitrators that all the Steppe shares are pledged either to HSBC or Kazholdings Incorporated "KHI". In relation to KHI he was unable to tell the Arbitrators the extent of the Claimant's liability, save that it was "north of $5m." He said that he was associated with KHI but he expressly refused to explain who are the beneficial owners and ultimate controllers of that company. Accordingly there must be real susp1c10n that Mr. Wilson declines to provide information so as to "protect" the Claimants' Steppe shareholding from the consequences of any Order the Respondent may obtain in the Arbitration." 69. By 27 November 2008, having heard evidence from Mr. Wilson and Mr. Emmott, the tribunal remained of that view. They added: "It is appropriate, in our view, to make the Order in peremptory terms. The Steppe shares form the most valuable asset of the Claimant company on the evidence before us. Mr. Emmott claims not only the Steppe shares but also a 33% shareholding of the issued share capital of the Claimant. Mr. Wilson of the Claimant has been evasive in his evidence before us concerning the manner in which the Claimant's own share capital has been dealt with and we have taken the view that it has been perfectly within Mr. Wilson's influence or control to bring about a situation in which the Steppe shares are secured as we have directed." 70. The tribunal formed that view notwithstanding that they were aware that the Steppe shares were the subject of an undertaking to Tomlinson J. and were held in an HSBC nominee account. 71. Counsel for MWP said, in answer to a question from me, that he was asking the court to take a different view from the tribunal as to the need for an order under section 38(4). For the reasons that I have given I do not consider that it is appropriate or in the interests of justice for the court to rehear the application for an order under section 38(4) or even to review that order, at any rate in circumstances where the tribunal has given reasons for its decision which may reasonably be considered to support its decision. I therefore decline to consider whether the court would have taken a different view of the need for an order under section 3 8( 4 ). The tribunal has formed a clear view that there is such a need having had the benefit of considering the documents in the case and of hearing Mr. Wilson give evidence. For the reasons I have given the court should use its power under section 42 to support the order made by the tribunal rather than to frustrate that order. Balance of convenience 72. It was said that the balance of convenience was not in favour of making the order. In addition to saying that there was no risk of the Steppe shares being dissipated it was said that Mr. Emmott's assets were so modest that any cross-undertaking was valueless and that there were risks to MWP arising from the making of the order. 73 . However, the balance of convenience was one of the issues argued before the tribunal before it made its peremptory order. The tribunal considered that it was appropriate to make the order. For the reasons that I have given I decline to consider whether the court would have taken a different view. Prospects of success 74. It was said that Mr. Emmott's claim had no prospect of success. There were two limbs to this argument. The first was that there was no evidence in support of the pleaded agreement concerning 27% of the Steppe shares. The second was that Mr. Emmott had admitted serious breaches of fiduciary duty such that he was disentitled from recovering the 27% of Steppe shares. This second limb was elaborated in a skeleton argument of some 1 0 pages. I was told that the alleged breaches of fiduciary duty were relied upon before the tribunal but not the citation of authority found in the skeleton argument. I was also told that MWP required permission from the tribunal to pursue the second limb of the argument. 75. Since it was submitted before the tribunal that the strength of the claim to 27% of the Steppe shares was "non-existent" and yet the tribunal made the peremptory order I can safely infer that the tribunal did not consider that the strength of the claim was "non-existent". In those circumstances I do not consider that it is appropriate or in the interests of justice for the court to review the merits of the underlying claim. The parties have referred that claim to the tribunal and it is that tribunal, rather than the court, that should consider the merits of the claim. I therefore decline to enter into an assessment of the merits of Mr. Emmott's claim in order to measure its prospects of success. Misconduct not before disclosed 76. The question of Mr. Emmott's "serious defalcations" was put before the tribunal. It nevertheless made the peremptory order. The tribunal is in a far better position than the court to judge the significance of these matters in the context of the case as a whole and in any event I decline to enter into such an assessment when the tribunal must have done so. Thjrd parties 77. Finally, it was said that the com1 ought not to make the order sought without giving third parties potentially affected by the order an opportunity to make submissions. However, I am told that KHI and HSBC were given notice of the application to be made by Mr. Emmott and neither has chosen to appear and make submissions. Moreover, a third party is always at liberty to come to the court if it considers itself affected by an order of the court. 78. In any event, with regard to the Steppe shares the tribunal has said "We have made it clear throughout that we accept that such shares should be held to our order subject to all existing liabilities secured on them." 79. In those circumstances it is difficult to see how third parties might be affected by compliance with the tribunal's order. Conclusion as to U1e application under section 42 80. The conditions set out in section 42(3) and (4) for the enforcement of a peremptory order of the tribunal are satisfied. Firstly, Mr. Emmott has exhausted the arbitral process in respect of MWP's failure to comply with the order; it was not suggested that he had not done so. Secondly, the court is satisfied that MWP has failed to comply with the peremptory order within the time prescribed. 81. For the reasons I have given it is appropriate that the court should support the tribunal's peremptory order by making an order requiring MWP to comply with it. There are no reasons why in the interests of justice the court should refuse to do so. 82. I shall therefore make the order which has been sought under section 42. I have varied the time for compliance until 4pm on 13 January 2009. I am unable to hand down these reasons until12 January 2009. The application under Section 44 of the Arbitration Act 1996 83. This is an application by Mr. Emmott for a freezing order in respect of the Steppe shares. The court is empowered to make such an order in respect of an arbitration by section 44(2)( e) of the Act. If the case is not one of urgency the permission of the tribunal is required; section 44(4). 84. The order is sought in circumstances where in 2007, upon an application by Mr. Emmott for a freezing order in respect of 27% of the Steppe shares, Tomlinson J. accepted an undertaking from MWP that it will not in any way dispose of, deal with, charge, assign or diminish the value of more than 73% of the shares that it currently holds in Steppe Cement Limited 85. During a hearing on 26 September 2008 Mr. Wilson gave evidence which gave rise to the possibility that MWP had not complied with its undertaking by borrowing against the Steppe shares. Lord Millett said in relation to that evidence: "We now have a problem. Will the Steppe shares be there unencumbered to the extent of the amount necessary to meet the counterclaim and we have no idea. We have the man here and we just don't know." 86. Moreover, I was told by counsel for Emmott without contradiction by counsel for MWP that on 23 February 2008 Mr. Wilson personally signed documents which caused the shares in MWP to be transferred to a Liechtenstein Anstalt called Windsor Fine Arts Establishment for seemingly no value. Liechtenstein has not ratified the New York Convention on the Enforcement of Arbitration Awards. No commercial justification for this transfer has been suggested. There is therefore the real possibility that this transfer was executed in an attempt to put the MWP shares beyond the reach of Mr. Emmott. It was suggested on behalf of MWP that this transfer does not support a risk that assets of MWP may be put beyond the reach of Mr. Emmott. It is true that the shares ofMWP are not assets ofMWP but Mr. Wilson's conduct in effecting the transfer in circumstances where Mr. Emmott claims to be a 33% shareholder in MWP gives rise to a real sense of unease that MWP may seek to put assets of MWP, in particular the Steppe shares, beyond the reach of Mr. Emmott. This is so notwithstanding that MWP gave an undertaking to Tomlinson J. not to do so and has adduced evidence that the Steppe shares are held by an HSBC nominee company. 87. In these circumstances there is a clear risk of dissipation of the Steppe shares such that it is appropriate to make the freezing order sought. The order is sought in respect of all the Steppe shares, not just 27% of them. Counsel for MWP said there was no reason why the order should be in respect of more than 27% of the shares. He also said that the permission of the tribunal for the freezing order application was m respect of27% of the Steppe shares rather than all of the shares. 88. I can envisage reasons why a freezing order might be sought in respect of more than 27% of the Steppe shares since Mr. Emmott not only seeks a declaration as to ownership of27% ofthe shares but also has a damages claim. However, these reasons were not articulated either in the written or oral submissions of counsel for Mr. Emmott and so counsel for MWP did not have an opportunity to respond to them. In those circumstances I consider that the freezing order should be restricted to 27% of the Steppe shares, as was the undertaking to Tomlinson J. 89. It was suggested that Mr. Emmott's undertaking in damages should be fortified by provision of a guarantee in the sum of £200,000 from a first class bank with a place of business in this jurisdiction. Tomlinson J. did not require the undertaking to be fortified. Since then Mr. Emmott has admitted to misconduct. This should be taken into account. However, the misconduct was not such as to dissuade the tribunal from making the peremptory order. Further, it appears to be common ground that Mr. Emmott has modest means. There is therefore a risk that a requirement that the undertaking be fortified by a bank guarantee in the sum of £200,000 will not be satisfied and the court will be unable to assist the arbitral process to operate effectively. No specific loss has been identified as likely to flow from the grant of a freezing order. When granting the peremptory order the tribunal noted that MWP had not suggested it would be put under any disadvantage by ensuring compliance with it. KHI, an entity which there is good reason to believe is controlled by Mr. Wilson, is said by him to have other assets. There is therefore the possibility that any loans by HSBC to KHI can be secured on those other assets. I consider, taking all these matters into account, that the court should not require the undertaking to be fortified in the manner suggested. 90. I have considered whether, in circumstances where Mr. Emmott has admitted misconduct in the course of his cross-examination before the tribunal, it is appropriate to grant a freezing order on his application. However, the misconduct was not such as to dissuade the tribunal from making the peremptoty order or from granting permission for this application. I therefore consider it is appropriate to grant the freezing order "to help the arbitral process to operate effectively" (see paragraph 214 of the DAC report) notwithstanding the misconduct admitted by Mr. Emmott. 91. There should be a provision in the order making clear that compliance with the order pursuant to section 42 shall not be regarded as a breach of the order pursuant to section 44. 92. I have considered the other objections which were raised to the form of the order. I agree that the tribunal should have power to vary or discharge the order; see section 44(6) of the Arbitration Act 1996. The words "or of the Tribunal of Arbitrators pursuant to clause 7 of this order" should be inserted in paragraph 2 after the words "until further order of this court". I also agree that MWP should not be excluded from the persons who may apply for a variation or discharge of this order. A new clause 14 should therefore be added giving MWP liberty to apply for a variation or discharge on two clear days' notice to Mr. Emmott's solicitor. I would however expect any application to vary or discharge to be made in the first instance to the tribunal. Conclusion as to the application under section 44 93. For the reasons I have given I will make the order which has been sought under section 44, subject to the amendments which I have indicated. Neutral Citation Number: [2015] EWHC 3532 (Comm) IN THE HIGH COURT OF JUSTICE QUEEN'S BENCH DIVISION COMMERCIAL COURT Before: MR JUSTICE BURTON Between: (1) Ashot Egiazaryan (2) Vitaly Gogokhiya -and- (1) OJSC OEK Finance (2) The City of Moscow Case No: 2014-813 Royal Courts of Justice Strand, London, WC2A 2LL Date: 04/12/2015 Claimants Respondents Mr Joe Smouha QC and Mr Jeremy Brier (instructed by Gibson, Dunn & Crutcher LLP) for the Claimants Mr Richard Millett QC and Ms Jessica Wells (instructed by Jones Day) for the Respondents Hearingdates: 18, 19and20November2015 Judgment Mr Justice Burton : I. This hearing arises out of an Arbitration Award by Mr Andrew Foyle, Mr Dominic Kendrick QC and, as Chairman, Dr Georg von Segessor, dated 5 June 2014, by which the Arbitrators concluded that they had no jurisdiction over the claims brought by the First Claimant, Mr Ashot Egiazaryan ("Cl "), and the Second Claimant, Mr Vitaly Gogokhiya ("C2"), against the First Respondent, OJSC OEK Finance, a Russian company based in Moscow ("Rl "), and the Second Respondent, the City of Moscow ("R2"). The application before me under s.67 of the Arbitration Act 1996 ("the Act") is brought by C2; Cl, who was originally a party to the application, no longer challenges the findings of no jurisdiction over his claims. C2 has been represented by Joe Smouha QC and Jeremy Brier, and both the Respondents, as they were before the Arbitrators, by Richard Millett QC, and now also by Jessica Wells. The claims by C1 and C2 are in tort, by reference to Russian law, namely Article 1064 of the Russian Civil Court, which provides that "harm caused to the personality or property of[a citizen or legal entity] shall be subject to compensation in full by the person who has caused the harm". The tortious claims were made by reference to what Mr Smouha described as "a corporate raid' (being "the redistribution of a MR JUSTICE BURTON A!mrov<'d Judgment Ashot v OJSC company's ownership through a combination of legal, illegal and illegitimate means"), allegedly devised and orchestrated by Rl and R2 to oust the Claimants from a prestigious and lucrative project to redevelop the Moskva Hotel adjacent to Red Square in Moscow ("the Project"). 2. The two Agreements containing the relevant arbitration clauses, which related to the control and management of a BVI company initially owned by C2, Konk Select Partners Inc ("Konk"), were the Konk Shareholders' Agreement the ("Konk SHA") and the Konk Share Purchase Agreement the ("Konk SPA", or ''the First Konk SPA" to differentiate it from that in June 2009). C2, Rl and Konk were the parties to the Konk SHA, and they were also parties to the Konk SPA, in addition to a Cyprus company, Falmiro Trading Ltd ("Falmiro"), beneficially owned by Cl and others, being the borrower under a loan from Deutsche Bank AG, which was being acquired by Konk. Recital J of the Konk SHA recorded that the shareholders (C2 and Rl) were entering into that agreement to set out the terms governing both their relationship as shareholders ofKonk and the management and operations ofKonk and of Tribalin Trading Ltd ("Tribalin"), CJSC Decorum ("Decorum"), OJSC DecMos ("DecMos") and what was defined as the "complex", of which DecMos was the lessee, being the plot on which the Project was being constructed. The governing law of both Agreements was English law. 3. Section 10.13 of the Konk SHA reads as follows: "1 0.13 Arbitration of Disputes (a) Any dispute, controversy or claim arzszng out of, relating to or in connection with this Agreement, including any question regarding its existence, validity or termination, or regarding a breach of this Agreement (a "Dispute"), shall be referred to, and finally settled by arbitration under and in accordance with the Rules of the LCIA then in effect (the "Rules''), which Rules are deemed to be incorporated by reference into this Section 10.13. (b) 'l'he place of arbitration shall be London, England, and the award shall be deemed to have been made there . . . (e) The parties agree, that all arbitration proceedings initiated under this Agreement and other Transaction Documents [defined so as to include, inter alia, the SPA] (subject to changes and amendments made from time to time thereto) may be considered simultaneously by one and the same arbitration tribunal provided that such proceedings are interdependent or proceed from the same or interdependent facts, causes or circumstances, and provided always that the tribunal considers the full or partial consolidation of such arbitration proceedings possible." MR JUSTICE BURTON Anprovcd .ludguwnl AshotvOJSC The Konk SPA contained mutatis mutandis materially the same provisions in its clause 8. 4. The Claimants asserted before the Arbitrators that C2 entered into the Konk SHA and Konk SPA as nominee or agent of C 1, so that C 1 was entitled to participate in the arbitration even though not a signatory to the Agreements. The Arbitrators concluded, after considering the evidence before them, that C2 was not C1 's agent but held the Konk shares in his own right. Hence C 1 was not entitled to participate in the arbitration. As set out above, C1 does not now challenge that decision. 5. The Claimants alleged before the Arbitrators that R2, albeit not a signatory to the Konk SHA or SPA could be joined in the arbitration by virtue of the provisions of Article 105 of the Russian Civil Code, by virtue of R2's liability in respect of the contractual obligations of its dependent company R1. Jurisdiction over the claim against R2 was rejected by the Arbitrators, but is renewed before me. 6. The issues before me were as follows: i) Whether the Tort Claim, now sought to be made only by C2, falls within the arbitration clauses. The Arbitrators found that neither the claims made by C1 nor C2 fell within those clauses ("Issue 1 "). ii) Whether the Tort Claim can be pursued by C2 against R2, by virtue of Article 105. The Arbitrators concluded, having heard evidence from Russian law experts, in paragraph 468 of the Award that: "The provision makes a parent jointly and severally liable on the relevant contract as a whole. To the Arbitral Tribunal's mind, this includes liability to perform the Arbitration Agreement. The parent is as liable to arbitrate disputes as it is to perform the primary obligations under the relevant contract". However the Arbitrators concluded that, since English law was the proper law of the Agreements, Article 1 05 had no effect ("Issue 2"). iii) Iflssues 1 and/or 2 are resolved in favour of C2, whether the Tort Claim by C2 should be remitted to the Arbitrators in the exercise of my discretion pursuant to s.67(3) of the Act, or whether for him to pursue such a claim would be an abuse of process pursuant, or analogous, to the principles of Henderson v Henderson (1843) 3 Hare 100, or an abuse of s.l(a) of the Act. The main question is whether C2 is held to have made the Tort Claim before the Arbitrators or whether the claim now made by reference to his own beneficial entitlement to the Konk shares (as found by the Arbitrators), as compared with the case rejected by the Arbitrators that he held the shares as nominee for C1, is a new claim ("Issue 3"). 7. The Arbitrators held an Evidentiary Hearing over a number of days in February 2013, hearing live evidence from factual and expert witnesses. There was also a large number of written statements, submissions and memorials, and the Award consisted of 629 paragraphs. They decided, after opposition by the Claimants, by a Procedural Order No. 11 of 31 August 2012, not to have a separate hearing on jurisdiction, MR JUSTICE BURTON Approved Judgment Ashol v OJSC recording that they were not convinced that any of the jurisdictional issues could be effectively isolated from questions of fact which were related to the merits. In the event they reached conclusions of fact by reference to the jurisdictional arguments, but recorded, in paragraph 566 of the Award, that, in the light of their rejection of jurisdiction over the Tort Claim, they had concluded that "there is no need for the Arbitral Tribunal to consider the arguments on the merits of the Tort Claim that were presented by the Parties". 8. The Claimants' Tort Claim brought in the arbitration, which Cl and C2 contended, and Rl and R2 denied, fell within the terms of the arbitration clauses, was described by the Arbitrators in paragraph 533 of the Award by reference to 21 "alleged unlawful acts", referred to by the Arbitrators as numbered bullet points. Mr Smouha before me has reconstituted the claims sought to be pursued by C2 alone in a remitted arbitration by reference to those 21 bullet points, although five of them (bullet points 1, 2, 3, 18 and 19) have been omitted, as C2 makes no claim relating to the period prior to the Konk Agreements. Mr Smouha has described the claim by reference to three main allegations, subsuming the surviving seventeen bullet points beneath them, as follows. He explains that since there is no concept of conspiracy in Russian tort law, there is simply one claim of unlawful conduct and harm contrary to Article 1064, albeit exemplified by the acts complained of: "1. The Konk Agreements were entered into by C2 with Rl as the gateway by which the entire 11corporate mid" mu made possible, iiJcludiiJg whereby BIJ employee of Mr Kerimov became installed as a director of DecMos with the ability to control the project directly. • Bullet Point 4 from Paragraph 533 of the Award: Respondents arranged the subsequent transfer of the interests in the Project leveraged by R2 through the Konk Agreements to Mr Kerimov. 2. The Corporate Raid involved C2 in numerous respects; critically one aspect of the corporate raid was the instituting of spurious criminal proceedings against [C2] when he sought to commence legal proceedings in Cyprus to prevent R2 from wielding complete control over Konk and the Project through the vehicle of R1 and the Konk Agreements. Further, between 16 and 20 June 2009, raids by special police in masks with automatic weapons were carried out at (inter alia) [C2's] home, aimed at forcing CJ to capitulate and sign over his interest in the Project (and any indebtedness owed to him) to Kerimov and his associates. • Bullet Point 5: On 22 January 2009, R2, without telling CJ, in order that it would be a fait accompli, acted together with Mr Goloshchapov and Ms Pavlyuchenko to remove C I 's General Director of DecMos (Mr Lapshov) and replace him with a Kerimov associate MR JUSTICE BURTON i\mll"ovcd .ludgmcnl (Ms Kotandzhyan), thus giving Mr Kerimov operational control of the Project and leverage to implement further pressure and intimidation tactics, including forcing Cl to sign the Framework Agreements. • Bullet Point 6: Respondents knew, as CJ did, that in Russia an order replacing the general director is the beginning of a corporate raid. • Bullet Point 7: R2 procured a breach of Rl 's obligations toward Claimants under the Konk Agreements, including Claimants' first refusal rights over Rl 's sale of its Konk shares to Mr Kerimov. • Bullet Point 8: Respondents assisted Mr Kerimov 's unlawful interference in the business relations of DecMos and Decorum from January 2009 at the latest. • Bullet Point 10: In April 2009, Ms Kotandzhyan continued the process of consolidating control over the Project by removing the DecMos offices to Mr Kerimov 's building. Respondents acquiesced in this move. • Bullet Points 11-13 concern factual background to the corporate raid that may form relevant context for a C2 claim but are not particulars of the C2 Tort Claim. • Bullet Point 14: R2 made fraudulent requests on behalf of Rl to commence criminal proceedings against Cl. These requests resulted in the commencement of bogus criminal proceedings on order against C2 on 1 June 2009. • Bullet Point 15: R2 commenced hopeless and vexatious legal proceedings against Claimants (and others) concerning purported breaches of the Investment Agreement. • Bullet Point 17: Respondents, together with their co- conspirator Mr Kerimov, arranged theatrical raids at Claimants' offices by masked police with automatic weapons, distressing searches at the homes of Claimants' associates (Messrs Artem Egiazaryan and Dmitry Fitisov) and intensive and baseless interrogations of Claimants' associates (Messrs Artem Egiazaryan and Dmitry Fitisov), all of which were designed to intimidate Claimants. 3. This culminated in the unlawful IBking of C2's shares in Konk which held the stake in the Project. The Respondents caused harm to C2 by assisting in the seizure of the Konk Shares which culminated in C2 being forced to sign the Second Konk SPA signing away his valuable interests in Konk to Mr Rotenberg for US$2. Ashot v OJSC MR JUSTICE BURTON AllPI'Ovcd .fudum~nt • Bullet Point 16: Respondents knew that when they were contacted by Mr Kerimov in June 2009, there had been no negotiation and no transaction. Respondents nonetheless approved and participated in the execution of documents that were not negotiated and on which Claimants received no legal advice. • Bullet Point 20: Following consummation of the raid, Respondents acted with their co-conspirators, Messrs Kerimov, Rotenberg and Goloshchapov, to permit the transfer of ownership of the Project out of Limerick [in whose shares Cl had a substantial interest] and Konk and into new layers of off-shore companies designed to place their interests in the Project out of reach. • Bullet Point 21: Re::.pondents have, since the consummation of the raid and all to the present, acted together with their co-conspirators to conceal evidence of the raid from this and other tribunals." Ashot vOJSC 9. I shall deal first with the issue as to whether R2 was properly joined in the arbitration. There is no issue between the parties, as there is in respect of Issue 1, with regard to the approach that the Court should adopt towards a decision made by arbitrators as to their own jurisdiction. In relation to this Issue, the parties have agreed to accept the conclusions of the Arbitrators as to Russian law, after hearing the expert evidence, and neither counsel seeks to go behind those conclusions. The issue is simply whether the Arbitrators were correct to conclude that Russian Jaw had no effect on whether a non-signatory to an English law arbitration agreement could be joined in the arbitration. 10. Given the conclusion of the Arbitrators as to the meaning of Article 105, it is unnecessary for me to set out that Article in this judgment. There were extreme positions taken by the two sides before the Arbitrators as to the meaning and effect of it. Insofar as the Claimants were seeking to argue that its effect was to make R2 a party to the Konk Agreements, the Arbitrators did not accept that submission. The Respondents on the other hand were contending that arbitration agreements fell outside the scope of Article 105 entirely. I set out in paragraph 6{ii) above the conclusion of the Arbitrators. It is clear, and in the end Mr Millett accepted, that what they decided was that the effect of Article 105 was that R2 was not simply a primary (and certainly not just a secondary) obligor, but was jointly and severally liable with Rl on the contract, and liable to take part in the arbitration, and lhus be a pany to iL; except that it was not entitled to initiate arbitration proceedings or counterclaim in the arbitration. This is the clear impact of paragraph 468 of the Award. II. The Arbitrators continued (in paragraphs 469-470) by considering that R2 could be made answerable for the liability of Rl, and made a defendant to proceedings in Russia to establish such liability. However it is very difficult to see what the Arbitrators can have meant in that regard, since, if R2 was "as liable to arbitrate disputes as ... to peiform the primary obligations" under the Arbitration Agreement, MR JUSTJCE BURTON Approved Juclgmcn! AshotvOJSC then such joinder in proceedings in Russia would seem hardly appropriate or necessary, save perhaps for enforcement purposes. Such conclusion appears simply to be a product of their conclusion that whatever might be the effect at Russian law, that would have no impact on R2's obligation to participate in an arbitration governed by English law. 12. For such was indeed the conclusion of the Arbitrators, namely that there was no effect of Article 105 at English law; English law, being the proper law of the contract, governed the arbitration, and would not recognise R2 as being party to the arbitration agreements (paragraph 477 of the Award). Their conclusion was (at paragraph 478) that "Article 105 . . . is legally irrelevant to the construction of the Arbitration Agreements and forms no proper basis by which [R2] could be held to be party to an English law contract or arbitration clause. If Claimants wish to invoke rights against [R2] under Article 105, they would need to do so in judicial proceedings in Russia". 13. Mr Millett submits accordingly that the Arbitrators had no jurisdiction to hear a claim against R2 within the arbitration. He submits that Article 1 05 does not say that R2 is a party to the Arbitration Agreement (as indeed the Arbitrators found), nor that R2 is the same entity as R1, nor that R2 is a transferee from R1, and it does not address the capacity or status of Rl. But in any event, whatever the impact of Article 105 at Russian law, and he was driven to accept that the Arbitrators did nevertheless find that, at Russian law, R2 was liable to participate in the arbitration, he submitted that the Arbitrators rightly applied English law to exclude R2 from the arbitration. 14. Mr Millett relies upon the following: i) The well established authority that English law governs who is a party to an Arbitration Agreement. Although Rule 64 in Dicey Morris & Collins: The Conflict of Laws (151h Ed at 829) does not expressly refer to the parties to an arbitration agreement when recording that "the material, validity, scope and interpretation of an Arbitration Agreement are governed by its applicable law", nevertheless the underlying concept of consensus requires the proper law of the contract to govern who has agreed to it. ii) He relies upon the decision of Langley J in Peterson Farms Inc v C & M l•'arming Ltd l2004] 1 Lloyd's Rep 603 (mentioned, without being doubted, in Dallah Real Estate & Tourism Holding Co v Ministrv of Religious Affairs of the Government of Pakistan [2011] 1 AC 763). In _Peterson Farms, Langley J, in relation to an arbitration between Indian and Arkansas companies, in which the proper law of the agreement was Arkansas law, and the curial law, because of the arbitration taking place in London, was English law, concluded that there was no room for the interposition of a 'Group Companies doctrine' so as to entitle the claimant to recover in respect of what were described as "parent losses" and "grandparent losses". Langley J emphasised (at paragraph 43) that "the identification of the parties to an agreement is a question of substantive, not procedural law". iii) Mr Millett relied on the conclusions drawn from Peterson Farms by David Joseph QC in Jurisdiction and Arbitration Agreements and their Enforcement (2"d Ed) at 7.44-45, where he said: MR JUSTICE BURTON t\pprovcd Judgment AshotvOJSC "Where the signatory to the agreement is one of a group of companies, and English law is the governing law of the arbitration agreement - absent the application of agency principles, rectification, the 1999 Act or piercing the corporate veil - members of the group companies will not be actual or deemed parties to the dispute resolution agreement . . . [In certain cases, examples of which, primarily by reference to civil law systems, he gives], the relevant member of the group of companies may be found to be a contracting party even though not a signatory, and may be joined either as a claimant or a respondent in arbitral proceedings . . . Where such principles are invoked, they must form part of the governing law of the arbitration agreement. The identification of the parties to the agreement is a question determined by substantive not procedural law." 15. The starting point for a critique of the Arbitrators' conclusion is the fact that, in their conclusory paragraphs which I have set out above, at paragraphs 4 77 and 4 78, they have expressed it in terms that Article I 05 "forms no proper basis by which [R2} could be held to be party to an English laJt-.1 ... arbitration clause" (my underlining). That is, as Mr Smouha points out, the fallacy, and the key to their incorrect conclusion. They themselves did not find that Article 105 rendered R2 even at Russian law a party to the arbitration clause, but that it resulted in its being liable to arbitration and to be joined in the arbitration. 16. Mr Smouha answers Mr Millett's submissions as follows. 17. First he accepts the proposition that English law (and substantive law, not procedural law) governs the question as to who is party to the Arbitration Agreement. But that is not the question. At English law there will be many occasions when parties who were not signatories of an arbitration agreement are entitled or bound to be parties to the arbitration: in circumstances such as agency (including cases of undisclosed principal and apparent authority), lifting the corporate veil, assignment, and other scenarios such as universal succession or merger, which may be applicable in other systems of law. English law is the necessary starting point, but where the question to be properly characterised (see Mance LJ in Raiffeisen Zentralbank sterreich AC v Five Star Trading LLC [2001] 1 QB 825 at para 27) is not who is or was party to the arbitration agreement but whether there is jurisdiction over a non-signatory to the arbitration agreement, then English conflicts rules will or may address another system of law. Thus he refers, as did Mr Millett, to paragraphs 105-106 of Lord Collins' speech in Dallah: "105. One of the most controversial issues in international commercial arbitration is the effect of arbitration agreements on non-signatories . 106. The issue has arisen frequently in two contexts: the first is the context of groups of companies where non-signatories in the group may seek to take advantage of the arbitration agreement, or where the other party may seek to bind them to it. The second context is where a state-owned entity with separate legal personality is the signatory and it is sought to bind the state to the arbitration agreement. Arbitration is a consensual process, and in each type of case the result will depend on a combination of (a) the applicable law; (b) the legal MR JUSTICE BURTON Atmro,•cd .Judgment Ashot v OJSC principle which that law uses to supply the answer (which may include agency, alter ego, estoppel, third-party beneficiary); and (c) the facts of the individual case." Like Mr Millett, Mr Smouha emphasises the word "applicable law", but he submits that that clearly does not, or not simply, mean the proper law of the agreement. 18. It is manifest that there will be different scenarios, such as those mentioned by Lord Collins but not limited to them, in which a non-signatory of the agreement can properly be joined in an arbitration. One such example of course occurred in this very case, in which C1 was joined to the arbitration on the basis that C2, the signatory, was his agent. The Arbitrators did not find they lacked jurisdiction to hear his case because he was not a signatory, but because they concluded that he was not the principal, and that C2 owned the shares in his own right, and was party to the Konk Agreements in his own right. Mr Smouha pointed to other examples, such as whether partners can be joined or whether a victim can be a party to an arbitration between tortfeasor and insurer. Just as the proper law of the contract would not apply to issues of agency, so too it would not apply to whether there has been, as a matter of German law, merger between an old company entitled or obliged to arbitrate and a new company (Eurosteel Ltd v Stinnes AG [2000] 1 AllER (Comm) 964). It would be the rules of that law (to which English conflicts rules would look) which would for example govern whether a party was to be added or substituted, depending upon whether the relevant law required both assignor and assignee or both undisclosed principal and undisclosed agent to be joined. 19. So too in relation to the question here, Mr Smouha submits that English choice of law rules would look to the law of the place of incorporation of the signatory to govern whether a parent is liable to perform an agreement entered into by its subsidiary. He refers to Dicey at Rule 175, whereby, in the context of the entering into of a legal transaction, all matters concerning the constitution of a corporation are governed by the law of the place of incorporation and (at 30-128) "the cases at least establish that the law of the place of incorporation determines . . . the extent of an individual member's liability for the debts or engagements of the corporation"; and there is reference to Johnson Matthev and & Ltd v Ahmad AHoush [1985], 135 NLJ 1012 (CA) and in particular to JB Rayner Ltd v Department of Trade [1990] 2 AC 418 where Lord Oliver cites with approval the then equivalent in Dicey of that passage. 20. As for Peterson Farms, Mr Smouha does not disagree with the proposition that "the identification of the parties to an agreement is a question of substantive, not procedural law" but he submits that this is irrelevant to the present question. First of all we are not here identifying a party to an agreement, but resolving who can be made a party to an arbitration. Secondly, the issue is left open as to which substantive law is to be looked to. In Peterson Farms Langley J was not given any such assistance. As he points out himself, at paragraph 50, "it was not suggested to the tribunal that the Group of Companies doctrine was recognised by Arkansas law". It would seem therefore straightforward that, since neither of the two legal systems being considered before him, that relating to the proper law of the contract and the curial law, introduced such doctrine, and it was not even suggested that the doctrine arose as a result of Indian law, being the law of incorporation of the claimant, there was no room for the adoption of such doctrine. Thus it is difficult to see how Mr Joseph could have formed any conclusion based upon it in his book at 7.45, when he MR JUSTICE BURTON Approved Judgn•eut AshotvOJSC says that "the correct approach . .. ought to be to determine the identity of parties to the agreement by reference to the applicable governing law and not by reference to the principles which ordinarily govern arbitrations of that nature or the lex mercatoria". That itself would seem obviously right. On the other hand, if the question is one as to whether a non-signatory of the agreement can be joined by virtue of a concept such as agency or, in this case, a principle that shareholders or parents are obliged to arbitrate on contracts entered into by the signatory, then it is not the proper law of the contract which gives the answer, but English conflicts rules would look to another law, in this case the law of incorporation of the signatory. As Mr Smouha points, out if an English company made a contract governed by Ruritanian law, and under Ruritanian company law shareholders of Ruritanian companies were deemed to be parties to all contracts made by the company, it would obviously be inappropriate for an arbitral tribunal to apply Ruritanian law to assume jurisdiction over the shareholders of the English company. Hence Joseph's conclusion set out in paragraph 14 above, certainly in considering the parties to an arbitration as opposed to parties to an arbitration agreement, is incomplete. 21. I am entirely satisfied, for the reasons set out above, by way of answer to Mr MiJlett's submissions, that R2 was properly joined in the arbitration. The Arbitrators concluded, at paragraph 468 of the Award, that Russian law, being the law of incorporation of Rl, provides that R2 was liable to be a party to the arbitration. English law, as the proper law of the Arbitration Agreement, will look to that law to decide whether R2 should be joined as a party, just as it would look to the relevant law in a case involving agency, assignment or succession. The Arbitrators consequently had jurisdiction over R2, and it was not necessary for that obligation to arbitrate to be enforced in the Russian courts, as the Arbitrators suggested. Issue 1 22. Unlike Issue 2, where there was agreement between the parties to accept the evidence of Russian law given before the Arbitrators, and to argue whether the Arbitrators' conclusions had been correct in the light of that evidence, there was no such agreement in respect of the major issue, namely whether the Tort Claim alleged fell within the arbitration clauses. There was no submission to the jurisdiction by Rl or R2, and the Arbitr-ators decided to hear substantial amounts of evidence. Although, as set out in paragraph 7 above, the Arbitrators expressly did not proceed to make decisions on the merits, they explained their process in paragraph 108 of the Award namely: "As both the Parties' arguments on jurisdiction and their material claims place considerable emphasis on the facts, it is appropriate to first attempt a thorough analysis of the factual record that will lay the foundation for Section Vll of this Award, which addresses issues ofjurisdiction." 23. It was common ground that the hearing of a s.67 application by the Court is de novo. As Gross J described it in Electrostccl Castings v Scan-Trans Shipping [2002] EWHC (Corum) 1993, as cited by Langley J in Peterson Fnrms: "The question for the Court is ... not whether [the tribunal] was entitled to reach the decision to which [they] came but whether [they were] correct to do so": i.e. it is the correctness of the answer and not the reasons given which I must judge; and it is thus MR JUSTICE BURTON Ap11roved Jud<>mcnt Ashot v OJSC not a question of whether the Arbitrators came to a conclusion to which they were entitled to come on the evidence and reasoning before them, but whether they reached the right conclusion. This is emphasised by the Supreme Court in Dallah, although naturally Lord Mance at paragraph 31 said that a Court, even where re-hearing, will "examine, both carefully and with interest, the reasoning and conclusion of an arbitral tribunal which has undertaken a similar examination". 24. Where there has been substantial evidence taken below, the Court on an application under s.67 is free to rehear all such evidence, and in Azov Sb.ipping v Baltic Shipping [1999] 1 Lloyd's Rep. 68 Rix J addressed exactly such a position, concluding, at paragraph 70 that "the Court, upon a challenge under section 67, should not be placed in a worse position that the arbitrator for the purpose of determining that challenge". But that was a case in which there was a short issue of fact, resolved by the Arbitrator over 3 days, namely as to whether the claimant was party to the agreement. In this case, there was a very lengthy hearing, ranging over issues, including the agency or otherwise of C2 and the Russian law questions relating to R2, but, in the context of this Issue 1, addressing at length the jurisdictional facts, for the purpose of resolving whether the Tort Claim fell within the arbitration clauses. There has been no application by either side to rehear any evidence and (with the exception of the Russian law evidence to which I have referred) no agreement that any of the evidence should be taken as read before me, nor any agreement that any of the factual conclusions of the Arbitrators should be accepted before me. 25. It is understandably pointed out by Mr Millett that the fact that the evidence was taken at length arose out of the decision by the Arbitrators not to bifurcate the issues of jurisdiction and merits, and that this was on a successful application to that effect by the Claimants, although, as recorded in the Arbitrators' decision in paragraph 7(c) of Procedural Order No.ll of 31 August 2012, the Respondents themselves asserted that certain factual witnesses would probably need to testify even on jurisdiction alone. It does not seem to me, however, that this should impact upon the question as to whether the Arbitrators came to the correct conclusion. 26. Where there is such a lengthy evidential hearing below, even though the application before this Court is a complete rehearing, Mr Millett submitted in paragraph 11 of his skeleton that "it was open to C2 to challenge the Tribunal's findings of primary fact or factual conclusions on this application ... but he has not done so. C2 cannot deny the facts found on this application since he is bound by them". I do not accept this submission. It is contrary to principle: the same would apply, if he be right, in respect of a party denying jurisdiction who takes part in an arbitration hearing while expressly reserving its position, and yet is then entitled to challenge jurisdiction before the court. But it is in any event contrary to the express words of Lord Saville in Dallah at paragraph 160: "The findings of fact made by the arbitrators ... can in no sense bind the court". This is leaving aside the fact that the Arbitrators themselves made findings which would plainly be relevant to both jurisdiction and merits and yet, as set out in paragraph 566 of their Award (see paragraph 7 above) did so without having considered "the arguments on the merits of the Tort Claim that were presented by the Parties". 27. In any event there was discussion before me as to the impact of the Arbitrators' findings. In a similar case to Azov, where (unlike here, where there were wide- ranging questions as to the scope of the claim and of the arbitration) a dedicated issue, MR JUSTICE BURTON 1\purov~tl Jutll!ntcnt AshotvOJSC for example, as to whether a contract was ever made, might be decided by the arbitrators, there could be what could be described as a 'killer point': such as for example a finding by arbitrators that a claimant (Mr Smith) was in fact indubitably in Manchester when he was said to have been making the contract in London (this was dubbed in the hearing before me a 'Smith-Manchester' point). Despite considerable concentration on relevant paragraphs of the Award by Mr Millett and consequently by Mr Smouha, I was wholly unpersuaded that there were any Smith-Manchester points in this Award: i) The conclusions in paragraphs 239 and 241 of the Award related to that part of the Tort Claim made by Cl which antedated the Konk Agreement and is not pursued before me. ii) The Arbitrators concluded in paragraph 395 of the Award that the Claimants had not established that Rl knew that the Claimants were being coerced into entering the Cyprus Agreements (including the Second Konk SPA), as a result of which any residual interest of C2 in the Konk shares was disposed of, but I am not persuaded that the absence of such knowledge would be in any way a 'killer point'. iii) The passage in paragraph 551 whereby "the Arbitral Tribunal has considered whether [Rl] was clearly involved in the matters alleged in [the 21 bullet points] and concludes that it was not" cannot be read as meaning more than that the Arbitrators were not satisfied that Rl was "clearly involved", which particularly given their lack of conclusions on the merits (paragraph 566 of the Award) does not seem to me to qualify as a 'Smith-Manchester' point. However, even if any of those were stronger points than I am persuaded they are, the position would still remain that (i) this was an attempted factual analysis of a wide ranging question of scope, to which I shall come below, and not a straightforward factual question as in Azov (ii) as Lord Saville makes clear, this Court is not bound by those findings, and no such evidence has been called before me. 28. The real question in issue both before the Arbitrators and before me seems to me that which is contended for by Mr Smouha, namely that the duty of the Arbitrators, and now the duty of the Court, is to identify the dispute between the parties and then consider that dispute against the terms of the arbitration clauses. It is not the task of either the Arbitrators or the Court to weigh the merits of the case, just as it is not when considering whether there is a 'dispute', for the purpose of considering whether it is appropriate for there to be an application for summary judgment in the courts rather than reference to an arbitration at all (see for example Hayter v Nelson [1990] 2 Lloyd's Rep 265 at 271). 29. Such task has been greatly ameliorated by the guidance of the House of Lords in Fiona Trust v Privalov [2007] UKHL 40 [2007] 2 CLC 553, per Lord Hoffmann at paragraphs 13-17 and Lord Hope at paragraphs 26-27. In my judgment the resolution of such an issue does not require massive consideration of factual evidence, particularly against the background where the parties are not bound by an arbitrator's decision, and there can be a complete rehearing before the court. In this case the Tort Claim which was said by the Claimants, and now, as slimmed down, is said by C2, to fall within the arbitration clauses is that which I have set out in paragraph 8 above by MR JUSTICE BURTON ;\ppmvcd Jmlgmrn! Ashotv OJSC reference to Mr Smouha's summary. The reasons which the Arbitrators gave for concluding that the claims did not fall within the scope of the Arbitration Agreements are those now presented before me by Mr Millett, and opposed by Mr Smouha, and I shall deal with them in tum. 30. Tort The Arbitrators stated in paragraph 518 of the Award that "the only real claim in this arbitration is Claimants' Tort Claim. It is, in the experience of the Arbitral Tribunal, uncommon for none of the principal claims to be contract related". Mr Millett did not expressly support this proposition. It is clear from s.6(1) of the Act that an "arbitration agreement" within the Act means "an agreement to submit to arbitration present or future disputes (whether they are contractual or not)". There were contractual or quasi-contractual claims being pursued in the Award- of nullity and a breach of the Konk Agreements - but they were abandoned (with one unsuccessful attempt at resuscitation). However it seems to me that what effectively the tort constitutes is 'mal-performance' of the Konk Agreements; i.e. C2 began with a substantial interest in the Project through the Konk shares in November 2008 and allegedly by the acts of Rl/R2 ended up with a worthless residual interest in June 2009, which he transferred for $2. Mr Millett emphasised the passage in Merkin: Arbitration Law (2015) at paragraph 5.71, which did not support the Arbitrators' proposition, but which emphasised the need for a Tort Claim to be "closely relatecf' to an underlying contract or to have "necessary connection". Echoing the words of Lord Hoffmann in Fiona Trust, in which (at paragraph 13) he addressed disputes "arising out of the relationship into which [the parties] have enterecf', the Arbitrators in paragraph 544 directed themselves that they must decide whether the Tort Claim is a dispute that "arises out of the relationship into which the Parties entered pursuant to the Kong Agreements". By reference to the 21 bullet points, they concluded in paragraph 545 that "the claim advanced is insufficiently connected with the relationship created by the Konk Agreements to fall within the arbitration clause". It is difficult to see how that can be justified. 31. Other Parties In the same paragraph (518) in which the Arbitrators had commented on what they considered to be the uncommon event of a Tort Claim without a contract claim, they continued: "this unusual feature is combined with a claim for the tort of conspiracy but involves third parties as key conspirators", and "no English court case was cited with these two unusual features". In paragraph 517 of the Award the Arbitrators noted that "major participants in the Tort Claim are not parties to the Arbitration Agreements. The Arbitral Tribunal has in mind Messrs Kerimov, Rotenberg and Goloshchapov". Mr Millett supports this proposition, and refers to a statement in Merkin & Flannery: Arbitration Act 1996 (51h Ed), where, addressing the ''pragmatic and praiseworthy attempt" by the Court of Appeal in Fiona Trust to ensure that all disputes are brought together under one roof, the authors opine that "most forms of . . . wording will be sufficient to ensure that the arbitration will encompass the following categories of claims", and they list contractual claims, tortious claims for misrepresentation, restitutionary claims and "related claims based on conspiracy, provided that [my underlining] all the proposed respondents are parties to the arbitration agreement". Leaving aside the fact that this tort claim is not for conspiracy, but is a tort claim brought by reference to Article 1064 by C2 against R 1, for whom R2 is liable, neither counsel were able to assist me, and I certainly have no knowledge myself, as to where this proviso comes from. No authority is cited, and the suggestion really is that no conspiracy claim can be brought within an arbitration MRJUSTICE BURTON Approvcll.ludgmcnt Ashot v OJSC agreement, because a conspiracy always needs more than one party. It is my experience 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. 32. Other Agreements In paragraph 516 of the Award, the Arbitrators identified as a feature contra-indicating the Tort Claim falling within the scope of the Arbitration Agreements that there were other agreements, some of them containing dispute resolution clauses. Of course the situation is different now that C1 is no longer a party, as a result of the Arbitrators' decision, not challenged before me, because C1 was party to a number of other agreements. There is however no other agreement to which both C2 and R1 are parties, so that the principle to which Mr Millett drew an analogy, of the 'centre of gravity' spelt out by Thomas LJ in Sebastian Holdings Inc v Deutsche Bank AG [2011] 1 Lloyd's Rep 106 at 116, does not obviously apply, as Mr Smouha pointed out, being relevant only to where there is more than one agreement involving the same or similar parties, so that there is in effect a contest as to which clause is the most relevant. The only agreement to which Mr Millett could point was the so-called Cyprus Agreement, or Second Konk SPA, between C2 and Sparklon Holdings Ltd, by which he transferred his remaining interest in the Konk shares for $2. This may have crystallised C2's loss, and may well merit its own dispute or cause of action, but does not appear to me to detract from the appropriateness of the arbitration clauses in the Konk Agreements (already wide in their own terms by the reference to "consolidation") for resolving C2's Tort Claim against Rl/R2. 33. Strength oftbe case I have already indicated that I have seen no 'Smith-Manchester' point or killer point, even if that would be apt where I am deciding the matter afresh, as discussed in paragraphs 24 to 26 above. The Arbitrators considered that none of the 21 bullet points referred specifically to the actions of R1 (paragraph 536) and (paragraph 551) that, as discussed in paragraph 27(iii) above, R1 was not "clearly involved" in those matters. It also noted that the bullet points made "little mention of the Konk Agreement", identifYing, so far as concerns the bullet points relevant to C2, only bullet points ·4 and 7. The Arbitrators also note in paragraph 563(1) that "Claimants merely seek damages for the loss of the Limerick shares [referred to in paragraph 8(20) above], to which the Konk Agreements have no association . .. Were the Konk Agreements truly pivotal in this dispute one would have expected Claimants to seek damages for the value of their interest in Konk". As appears in paragraph 47 below, this appears to be a misunderstanding of the Claimants' case as put before them, and in any event the Arbitrators themselves appear to recognise (in paragraph 531) that there was loss in relation to the Konk shares by way of an "effect on the ultimate outcome of the actions alleged in the Tort Claim, namely Claimants' loss of their interest in the Project", albeit they described it as "restricted'. However, all these understandable criticisms appear to me to go to the strength of the Claimants' case, i.e. to the merits, in respect of which the Arbitrators had not considered the arguments, but not to the non-existence of a dispute between C1 and Rl/R2, by reference to the claims summarised above, falling within the scope of the Konk Agreements. 34. I recognise that it was necessary for the Arbitrators to hear evidence in relation to the issues with regard to Cl and R2, which they resolved. It is however regrettable that MR JUSTICE BURTON A1wrovcd ,Juilgmun! Ashotv OJSC Issue 3 so much time was also taken in addressing 'jurisdictional facts ' in relation to the question of whether the Tort Claim fell within the ambit of the arbitration clauses, particularly since at paragraph 509 they recognised that their decisions on jurisdiction were subject to 'review by English courts', in which none of their factual findings would be binding. It seems to me however that such conclusions as they reached in relation to the facts led them astray. They concluded in paragraph 564 that the "Tort Claim cannot be regarded as arising out of the Konk Agreements or the relationship created by them", by reference to the "limited scope of the Konk Agreements" and the "sweeping conspiracy on which the Tort Claim is based'. I am satisfied that on the basis of the claims made, as summarised by the Arbitrators, and as explained by Mr Smouha, there is a Tort Claim by C2 against Rl/R2, the nub of which is his loss of the Konk shares and his interest in the Project, which falls within the terms of the arbitration clauses in the Konk Agreements, widely construed as now encouraged by Fiona Trust. 35. Given that the Tort Claim against R1 and R2 falls within the arbitration clauses, should such claim by C2 be remitted to the Arbitrators? There are minor issues, to which I shall return in paragraph 45 below, but the real question is as to what claim C2 made before the Arbitrators? Mr Millett asserts that C2 did not make the Tort Claim before the Arbitrators, and so it should not be remitted to them, because the only claim he made was as holder of the Konk shares as nominee for C 1, and if he is now to make such claim as shareholder in his own right: i) that is not a claim which he should be permitted to make in the exercise of my discretion, and/or it would be an abuse of process: ii) It is not a claim which was referred to the Arbitrators. Remission under s.67 revives the claim (see Hussmann (Europe) Ltd v Pbanon [2003] 1 All ER (Comm) 879 at paragraph 82) but there is nothing to revive. 36. The first question to address is what the claim was that was put by C2 in the Request for Arbitration and the Statement of Case in the Arbitration. They are materially identical in this regard, so I shall limit my reference to the latter: "1. This Statement of Case is served on behalf of [C1] and [C2] (the latter in his nominal capacity as described herein) (together, "Claimants") ... 9. At the time the Agreements were entered into, and at all other times, Respondents knew and understood that [C2] held his Konk shares as nominee for [Cl]. 115. On the basis of the facts set forth herein, Respondents agreed with Kerimov and others to use unlawful means with intent to injure Claimants. The Claimants are entitled to compensation for all damages flowing from MR JUSTICE BURTON Anproved Judgment AshotvOJSC Respondents' illegal acts, including the loss of [Cl 's] investment in the Project and moral damages for pain and suffering. 121. . .. The Claimants' claims in this proceeding fall within the scope of the arbitration provisions in the First Konk SPA and the Konk SHA. 123. Claimant [C2] is a proper party to this proceeding because he is a signatory to both the First Konk SPA and the Konk SHA ... 133. . .. Respondents' roles in orchestrating the corporate raid and conspiring with Kerimov and others to illegally remove [Cl] from the Project (including their participation in the duress, intimidation and other wrongful acts committed against the Claimants) are tortious and in breach of the KonkSHA ... 134. Claimants seek an award: (b) Ordering Respondents to pay to Claimants damages for the loss of [Cl 's] investment in the Project in an amount to be determined; (c) Ordering Respondents to pay to Claimants moral damages in an amount to be determined for, inter alia, the anxiety and distress visited upon Claimants by Respondents' actions as described herein". 3 7. It is therefore a claim made by both Claimants in respect of the unlawful act said to constitute a tort, but on the basis that C2 was only a nominee in respect of the Konk Shares. In the Claimants' Post-Hearing Memorial, which formed the basis for the Arbitrators' summary of the 21 Bullet points in paragraph 533 ofthe Award (referred to in paragraph 8 above), the case was summarised as follows: "398. For the avoidance of doubt, the core tortious act underlying this claim is the theft of[Cl 's] stake in the Project (i.e. his shares in Limerick and Konk) ... Respondents have caused harm to [Cl], and to [C2] as his agent and bare trustee, by assisting in the seizure of his stake in the Project . .. 399. In addition to theft, Respondents engaged in further unlawful acts which led to the consummation of the corporate raid and contributed to the harm caused to [Cl], by the loss of his property, and to [C2] as his agent and bare trustee. Respondents have committed at least the following acts and omissions which, together with the acts and omissions of their co- MR JUSTICE BURTON Ann roved ,Judgment conspirators inflicted great harm on the Claimants by, among other things, unlawfully depriving them of their interest in Konk and the Project ... [the 21 bullet points are set out]. 535. Claimants seek an award: (d) Ordering Respondents [Rl and R2] to pay to Claimants [Cl and C2] damages for the loss of [Cl 's] stake in the Project in the amount of US$652.1 million; (e) Ordering Respondents to pay to Claimants moral or exemplary damages in an amount to be determined for, inter alia, the anxiety and distress visited upon them by Respondents ' actions as described herein . .. " 38. The Arbitrators concluded: "435. In light of the above, the Arbitral Tribunal finds that [Cl] vested the Konk Shares in [C2] absolutely. As a result, there was no bare trusteeship that rendered [C2] the agent of[Cl]. If anything, [Cl] was the agent of[C2]." Ashotv OJSC The Arbitrators therefore concluded they had no jurisdiction over Cl. In considering their jurisdiction in respect of the Tort Claim they made the following "Introductory remarks" in paragraph 509: "Although it has determined that neither [Cl] nor [R2] is a party to the Arbitration Agreements, the Arbitral Tribunal is mindful that its decisions on jurisdiction are subject to review by English courts. Consequently, the Arbitral Tribunal will consider whether the Tort Claim is within the scope of the Arbitration Agreements assuming, for this purpose, that [Cl and R2] are Parties to the arbitration. More specifically, it will also assume that [Cl] was the ultimate beneficial owner of the shares in Konk held by [C2]." The Arbitrators found, contrary to my conclusions above, that such Tort Claim was not within the arbitration clauses. Therefore any claims which C2 had failed (including his claim for moral damages). 39. Mr Millett submits that, upon this basis, C2 was making only a claim for moral damages for himself, and that, although the claim in respect of the loss of the Konk shares was put as one by the Claimants jointly, it was expressly in respect of Cl 's MR JUSTICE BURTON An!lrovcd Judemcnt AshotvOJSC stake in the Project or Cl 's investment, and so he was making no claim in respect of the loss of his own interest in the shares, which he cannot now be permitted to run. Apart from the straightforward case that such a claim was not a claim referred to the Arbitrators, he submits that there is a concept imported from the courts into arbitration reflecting, or by analogy with, Henderson v Henderson, which prevents afterthoughts or 'second bites of the cherry' in the interests of finality in litigation (or arbitration), so as to prevent what could have been run on a first occasion being run on a second occasion. Although he relies on no specific authority (and if necessary he would support the concept by reference to s.l(a) of the Act which requires that "the object of arbitration is to obtain the fair resolution of disputes by an impartial tribunal without unnecessary delay or expense") he has the support of Mustill & Boyd (2"d Ed 1989) whereby: "A party will not be permitted to raise an issue which was so clearly part of the subject matter of the earlier reference and so clearly could have been raised that it would be an abuse of process to allow the issue to be raised in fresh proceedings ... Parties to proceedings should take care to bring forward the whole of their case and not keep parts of it back or allow part of it to go by default; otherwise it will be too late for them, after the arbitrator has made his award, to raise fresh claims or defences which ought to have been put forward earlier." 40. The Arbitrators expressly record at footnote 564 to paragraph 509 that "it should be noted that there is no separate tort claim made by [C2] and no separate loss asserted. His role is confined to agent or bare trustee, bringing a claim on behalf of his principal/beneficiary". On the other hand at paragraph 550 of the Award they state: "The Tort Claim seeks damages only for the loss of shares in Limerick in which [C2] has absolutely no interest, and not for the loss of the Konk shares. But even if it did seek damage for loss of the Konk shares, it appears fairly evident that no damage could have been suffered by [C2] as a result of actions prior to the Konk Agreements . . . Any portion of the Tort Claim, to the extent that it involves [C2] and relates to events pre-Konk is, therefore, hopeless". C2 does not, at any rate before me, make any claim in respect of the period prior to the Konk Agreements, and thus this latter conclusion does not affect the position before me. 41 . Mr Millett submits that the Claimants could have pleaded the claim in the alternative ('If C2 is the beneficial owner of the Konk shares then in the alternative he makes the same claim in respect of the loss ofthe value ofthe Konk shares') and did not do so, no doubt for good tactical reasons, and C2 cannot now be allowed to retrace his steps. 42. Mr Smouha submits that in fact the Claimants were making just such a claim, and that the Respondents recognised that this was the case: i) In the Post-Hearing Memorial the Claimants pleaded the following under the heading "Damages For The Failure to Implement Konk (in the alternative)": MR JUSTICE BURTON Apnrovctl Judgment Ashotv OJSC "519. It is only necessary for the Tribunal to consider this section if it is determined, and it should not be, that Claimants' claims for seizure of the Limerick Shares do not fall within the arbitration provisions of the Konk agreements. 520. Respondents have submitted calculations from Deloitte ofwhat would have happened had the Konk transaction been implemented. This has been done in a transparent attempt to escape from their obligations to compensate Claimants for the very serious harm done to them. 521. The argument will go that, because Claimants would have received most of their value via their interest in Limerick upon implementation of Konk, the Konk shares themselves are of limited value and no damages are owed in connection with their seizure. This argument is to no avail. 522. As discussed in the section on jurisdiction, Respondents cannot parse out their conduct in connection with the seizure of the Limerick Shares - the very same conduct resulting in the failure to implement Konk and the seizure of the Konk shares - and claim that this conduct must be litigated twice in two different fora. Stated differently, Respondents are liable to compensate Claimants for the loss of the Limerick Shares. 523. In any event, Respondents' acts in failing to implement the Konk transaction in good faith and to instead embark upon a brutal, and brutally illegal, corporate raid, caused the Claimants' loss. If Respondents wish to couch this loss in Konk terms, so be it. Thus, as calculated by Deloitte, had the Konk transaction been implemented, and assuming FTI's 2012 valuation, the Claimants would have received proceeds in the range of US$ 627.5 million to US$ 733.8 million, the mid-point of which is US$ 680. 7 million. By wilfully failing to implement the Konk transaction and participating in the illegal corporate raid at issue herein, Claimants were damaged in this amount. 527. In addition, Deloitte ignores completely that, had Respondents complied with their contractual obligations, Claimants would have acquired Respondents' shares in Konk and all sales proceeds would have flowed to them as Konk shareholders, with none going to Respondents in the form of Special Dividends or otherwise. And in that scenario, Claimants would have gone forward in the Project holding a full 51% interest and enjoying all of the value that interest would generate. In this regard, Claimants' claims with respect to Konk are conservative." Mr Smouha submits that this was plainly understood to mean that if, as the Respondents' experts Deloitte contended, the loss was in Limerick (and Konk had a nil loss) then Cl alone would be entitled to recover, and as his position MR JUSTICE BURTON Auprnvcd Jmlumcnt Ashot vOJSC in the arbitration was challenged (in the event successfully) that would be favourable for the Respondents, leaving the loss in Konk, to which C2 was also a Claimant, as nil. Hence the Respondents' drive to place the loss in Limerick. ii) Rl 's Post-hearing Brief concluded with a prayer for relief seeking declarations that: "158.2 Claimant [Cl] is not a proper party to this Arbitration; 158.3 the Tribunal has no jurisdiction over the Claimants' claims against [R2]; 158.4 all of the claims advanced by the Claimants be dismissed for failure as a matter of law and/or facts and 158.5 Claimant [C2] breached the terms of the Konk SHA and the First Konk SPA and that he pay damages for losses arising from the breach in the sum ofC490,191". In a list of issues attached the following questions were set out as to be addressed: "B Whether [Rl] acted unlawfully, including but not limited to by abuse of rights and/or by participation in an unlawful conspiracy, during the transfer of the Claimants' interest in the Project to Mr Kerimov V. QUANTUM Project Equity A Whether the Claimants' claim in respect of loss of Project equity is to be properly valued by reference to (1) a 50% interest in Konk or (2) a 25.5% interest in DecMos. B If the former: (i) Whether the Claimants have standing to maintain claims in respect of losses suffered by the shareholders ofLimerick ... (ii) What value is to be placed on the Claimants' interest in Konk at the time of the June 2009 Cyprus Agreements". iii) In paragraphs 887 to 894 of the R2's Post-Hearing Brief the following firm submissions are made in respect of why the only loss was in respect of the Limerick shares (which could not be recovered in the arbitration) and that there was no loss in the Konk shares, and thus that C2's interest in the Konk shares (the only claim which can arise (887) or subsist (889) in the arbitration) was worthless: MR JUSTICE BURTON Approved JutlgnlCIIl' "VIII. QUANTUM PROJECT EQUITY AshotvOJSC A. Whether the Claimants' claim in respect of loss of Project equity is to be properly valued by reference to (1) a 50% interest in Konk or (2) a 25.5% interest in DecMos. 887. The claims brought in this arbitration can arise only in respect of Claimant [C2's] interest in Konk- even if one assumes in Claimants' favour in relation to each of the numerous defects in their case on the putative agency/trust relationship which is alleged to have existed in relation to Claimant [C2's] shareholding in Konk. Even on Claimants' case, Claimant [C2] was a nominal holder in relation only to the beneficial interest in the Konk shares. 888. Nevertheless, the Claimants' Reply contained a new assertion that the claims were being brought by Claimant [C2] as Claimant's [Cl] "agent and bare trustee in holding the Konk and Limerick Shares and entering into the Konk Agreements and Limerick SPA on his behalf' (emphasis added). It is not clear whether Claimants seriously intend to advance this position. Any suggestion that Claimant [C2] has any standing in relation to claims in relation to the Limerick shares must surely be an error; it is plainly wrong, and is flatly contradicted by Claimants' own submissions and evidence. 889. Contrary to the Claimants' assertion at paragraph 510 of the Post- Hearing Brief, this objection does not fall away if the Tribunal determines that the Claimants' claims in respect of the Limerick shares fall within the Konk arbitration agreements. It is an issue of legal standing, as well as jurisdiction. Claims in respect of the Limerick shares would have to be brought by the Limerick shareholders, Artem Egiazaryan and Mr Fitisov. They are not claimants, and could not be, since they were not party to the Konk Agreements. The only claim that can subsist in this litigation arises from Claimant [C2's] interests in Konk 894. The issue of quantum in this case must be limited to the value of Claimants' 50% shareholding in Konk, held subject to the terms of the Konk SHA. The Claimants offer no legal theory to contradict this obvious conclusion". Mr Millett submits that the reference in the last sentence of paragraph 889 referred to C2's interest in Konk as trustee. iv) Mr Smouha relies upon a passage in the recorded submissions of Mr Millett on behalf of the Respondents in the arbitration on 26 July 2013 at page 174 as illustrating that the Respondents well understood that there was an issue before MR JUSTlCE BURTON Ap!Jruvctl .ludgmcn[ Ashot v OJSC the Arbitrators as to what loss C2 had suffered and what interest he had in the Konk shares: "[CJ] isn't a party and shouldn't be here. That then leaves the Tribunal with having to decide on [C2 's] side first of all whether he has any interest in bringing these claims. Secondly, whether he has suffered any loss, and so far as [Rl] is concerned, you are going to have to analyse very carefully, no doubt with Mr Benson's further help, precisely what it is said it did wrong, and what precisely its own role in the so-called conspiracy was, leave aside how that would link back to the Konk agreements". v) In an exchange with me during the hearing (Day 21189) Mr Millett accepted that, since, as Mr Smouha submitted, English pleadings were not being adopted, it would have been open to the Arbitrators to find on the evidence which they had before them that they did not accept that C 1 had the claim, but that C2 did: Mr Millett accepted that the Arbitrators could have done so, but that they did not. He further accepted (Day 2/193) that in the passage from the transcript which I have cited above he was inviting the Tribunal to decide whether C2 had suffered any loss. 43. C2 plainly did make a tort claim in respect of the moral damages which he was said to have suffered as a result of the actions of Rl and R2 (although he did not expand on that in his evidence, which I have been shown). He plainly did bring a claim in tort in respect of the Konk shares, but so far as the quantum of it is concerned he was alleging that it was C 1 who had suffered the financial loss, and he was only a nominal shareholder. In fact now, in the light of the Arbitrators' findings, he asserts that the quantum of the loss he suffered was very much greater, and is to be valued by reference to the value of the Konk shares, and now that the Tort Claim itself can be pursued, as it falls within the arbitration clauses, he wishes to recover his loss, which is now to be ascribed to his beneficial, rather than nominal, shareholding. Further and in any event I am not satisfied that C2's proposal to pursue that claim now that Cl 's claim is ruled out is necessarily the same as or analogous to, a Henderson v Henderson situation. He is not seeking to bring a new reference to arbitration, but in front of the same Arbitrators to run his case as to quantum and entitlement on a different basis, in the light of the Arbitrators' conclusions as to C 1, not having done so previously. 44. I am invited by Mr Millett not to remit under s.67. Mr Smouha submits that I should remit C2's Tort Claim, coming as it does, as I have now found, within the arbitration clauses, to the Arbitrators, and leave it to the Arbitrators to decide whether, pursuant to Henderson v Henderson or otherwise, C2 is not to be pennitted to pursue his claim. But for my puzzlement at the apparent inconsistency between Footnote 564 and the passage in paragraph 550 of the Award (both set out in paragraph 40 above), I would have no doubt that, particularly in the light of paragraph 42(iv) and (v) above, there would be no inhibition upon C2 pursuing his claim in tort before the Arbitrators. As it is, subject to my considering the further matters below, I would remit the Tort Claim, C2 's claim for moral damages, which plainly can be pursued, and the issue as to whether C2 can now pursue his claim in respect of the loss of the Konk shares pursuant to that Tort Claim, to the Arbitrators. I have the less hesitation in doing so because of the existence of C2's claim for moral damages which plainly must be arbitrated. MR JUSTICE BURTON Approved J udgmcnl AshotvOJSC 45. The other matters to which I refer in paragraph 35 above, which are also said by Mr Millett to be reasons why I should not remit, now fall to be considered. They are twofold, but inter-relate: i) That I should be satisfied that I should not remit because the Tort Claim, and thus C2's claim if indeed he is to be permitted to pursue it, is bound to fail on the facts. ii) That even if C2 be entitled in respect of the loss of the Konk shares, that too is bound to fail because there is no provable loss in that regard. 46. As to (i), my conclusions are the same as those set out in paragraph 33 above. Even if I were bound by the findings of fact by the Arbitrators, contrary to my conclusions in paragraph 26 above, I am not satisfied that there are any 'Smith-Manchester' killer points in the Arbitrators' award: and in any event, as set out in paragraph 7 above, the Arbitrators themselves said in paragraph 566 that they had not yet considered the arguments on the merits of the Tort Claim. 47. As to loss, it does concern me to note that the Arbitrators concluded in paragraph 550 (set out in paragraph 40 above) that the "Tort Claim seeks damages only for the loss of shares in Limeric/C', when it is quite clear that in their Post-Hearing Memorial the Claimants were seeking damages for the loss of the Konk shares in the alternative. Thus this does leave open the Arbitrators' view in respect of whether any Joss was suffered (by C2 or otherwise), subsequent to the Konk Agreements, in respect of the Konk shares, if indeed a claim in respect of such loss was being sought; and I have already referred at paragraph 33 above to the fact that the Arbitrators were only able to opine in paragraph 531 that the alleged unlawful acts to which they were there adverting could be said to have had a "somewhat more restricted' effect on the Claimants' loss than they were alleging. In any event, Mr Millett points to the evidence of Deloitte which is referred to by the Claimants in their Post-Hearing Memorial, by reference to the addendum report of Simon Cuerden dated 21 February 2013, in which the very calculations which the Claimants adopt in paragraph 523 of the Memorial (set out in paragraph 42(i) above) as being the loss, are based upon Mr Cuerden's figures. Those figures in his report, by reference to the "revised calculation applying FTI's [the Claimants' expert] updated valuations, show a 50% equity stake in Konk as nil". 48. I am satisfied however that this a mismatch. Deloitte were valuing the Limerick shares (as no doubt were FTI as their primary case, though I have not seen their reports), which involved an elimination of any value of the Konk shares, as Limerick was 'upstream' from Konk. If, as the Claimants made clear in paragraph 527, also cited above, the loss had been calculated by reference to the Konk shares and not the Limerick shares, on their case a substantial loss would have been shown. I am certainly not persuaded not to remit this case to the Arbitrators by reference to a suggestion that the value of the Konk shares will be shown to be nil. Conclusion 49. I accordingly conclude that C2's Tort Claim falls within the arbitration clauses and that his claim against both Rl and, for the reasons I have given, R2 should be remitted to the Arbitrators pursuant to s.67 of the Act. Neutral Citation Number: [2015] EWI-JC 67 (Comm) IN THE HIGH COURT OF JUSTICE QUEEN'S BENCH DIVISION COMMERCIAL COURT Before: 2013 Folio 308, 2014 Folios 975 & 1060 Roval Courts of Justice 7 Rolls Building, Fetter Lane London, EC4A l NL Date: 22/01/2015 THE HON. MR JUSTICE POPPLEWELL BETWEEN MONDE PETROLEUM SA And Claimant in 2013 Folio 308 & 2014 Folio 1060, Defendant in 2014 Folio 975 WESTERNZAGROS LIMITED Defendant in 2013 Folio 308 & 2014 Folio 1060, Claimant in 2014 Folio 975 Eleanor Campbell (instructed by Candey LLP) for Monde Petroleum SA Stuart Isaacs QC & Ruth M D Byrne (instructed by King & Spalding International LLP) for WestemZagros Ltd Hearing date: 14 January 2015 Approved Judgment I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic. THE HON. MR JUSTICE POPPLEWELL The Hon. Mr Justice Popplewell : Introduction I. WesternZagros Ltd ("WZL") is a company incorporated in Cyprus with its head office in Calgary, Canada. It carries on business exploring for, developing and producing crude oil and natural gas. In 2006 it was engaged in negotiations with the Kurdistan Regional Government in Iraq ("KRG") for the exploitation of oil in the South Sulaymaniyah region ofKurdistan. 2. Monde Petroleum S.A. ("Monde") is a company incorporated in the British Virgin Islands. It is wholly owned or controlled by Mr Yassir Al-Fekaiki, whose late father, Mr Hani Al-Fekaiki, was a leading figure in the Iraqi opposition to Saddam Hussein. 3. The dispute between the parties originates from an agreement for consultancy services dated 23 Apri12006 ("the CSA"), by which WZL engaged the services of Monde, acting through Mr Al-Fekaiki, to assist WZL in concluding and maintaining the exploration and production sharing agreement ("EPSA") which WZL was negotiating with the KRG, and in relation to business opportunities in the region more generally. It provided for Monde to receive monthly fees, enhanced payments upon the achievement of certain milestones, and an option in certain circumstances to share in the benefit of a successful EPSA by acquiring a 3% interest. The CSA contained a London arbitration clause. 4. In January 2007 WZL stopped paying the monthly fee invoiced by Monde, and on 16 March 2007 WZL purported to terminate the CSA pursuant to a contractual termination provision. WZL disputed that the unpaid amounts invoiced by Monde, which included a milestone payment, were due. 5. On 18 April 2007 the parties entered into a settlement agreement ("the Termination Agreement"), under which WZL was to pay Monde's disputed invoices in full and there was a mutual release and waiver of all claims by each party against the other in respecl of Lhe CSA. The Terminalion Agreement contained a clause conferring exclusive jurisdiction on the courts of England and Wales. 6. Monde has commenced proceedings in 2013 Folio 308 ("the Commercial Court proceedings") by which it alleges that the Termination Agreement was induced by misrepresentation and/or duress. It claims damages for misrepresentation and/or duress in an amount which it alleges it would have earned under the CSA, including what it would have earned pursuant to the 3% option. The quantification of such damages claim necessarily involves the assumption that the CSA was not validly terminated, a matter disputed by WZL. The relief claimed by Monde in the Commercial Court proceedings also includes "further or alternatively" a claim for rescission of the Termination Agreement by reason of the alleged misrepresentation and/or duress. 7. Monde also commenced arbitration proceedings against WZL as a protective measure, notwithstanding that its primary case was that the Commercial Court had jurisdiction in relation to its claims. WZL made counterclaims for declaratory relief in the arbitration, including seeking declarations that Monde had no further entitlement under the CSA and so had not lost any benefit by entering into the Termination Agreement. Monde disputed that these questions fell within the tribunal's jurisdiction. By an award dated 16 July 2014 ("the Award"), the tribunal determined that it had no jurisdiction in the relation to the declaratory relief counterclaimed by WZL in the arbitration. It ordered WZL to pay Monde's costs of the arbitration proceedings. 8. There are four applications by WZL before the Court. The principal application is an appeal under s.67 of the Arbitration Act 1996 ("the s.67 appeal") by which WZL seeks to overturn the decision in the Award that the tribunal did not have jurisdiction over WZL's counterclaims for declaratory relief. The second application is to set aside an order of Flaux J dated 6 October 2014, made ex parte, granting Monde permission to enforce the Award in respect of the order for costs. The third application is a challenge to the Court's jurisdiction in respect of part of the claim made by Monde in the Commercial Court proceedings. It is common ground that the outcome of the second and third applications will be determined by the outcome of the s.67 appeal. The fourth application by WZL is for security for the costs of defending the Commercial Court proceedings in the event that it is unsuccessful on the other applications. The Agreements 9. Under the CSA, the services to be provided by Monde through Mr Al-Fekaiki were set out in Schedule A. Mr Al-Fekaiki's principal function was to advise and assist WZL in "concluding and maintaining a fully operational and enforceable Exploration and Production Sharing Agreement between Kurdistan Regional Government- Iraq and [WZL]. .. (the "EPSA ')". In return, Monde was to be paid monthly fees for an initial period, together with success fees on the achievement of certain milestones relating to the conclusion and performance of any EPSA between WZL and the KRG (Schedule B). By Schedule C Monde was granted an option to acquire a 3% working interest in any EPSA, exercisable on the declaration of commercial discovery under the EPSA, or 24 months from the commencement of the seismic programme, provided that the three events triggering payment of the various milestone fees under Schedule B had all occurred. 10. Clause 10 made prov1s1on for the term of the CSA and contractual rights of termination. Clause 5 contained detailed confidentiality obligations which would continue to bind the parties for a period of 5 years after termination of the CSA. Clause 12 provided that the CSA was governed by English law. Clause 13 provided: "13.1 If any dispute, controversy or claim arises between the Parties in relation to, or in connection with this Agreement, or in connection with the interpretation, performance or non- performance hereof, including any questions regarding the payment of fees, (the "Dispute"), the Parties shall promptly meet to discuss the Dispute in an attempt to resolve such dispute amicably through negotiation. 13.2 If the dispute has not been resolved within sixty (60) days ... , then either Party may, by notice in writing to the other, refer the dispute to arbitration to be fully settled." Clause 13 went on to provide that the arbitration was to be held in London under the ICC Rules. 11. In the eleven months which followed, two of the three milestones in Schedule B to the CSA were achieved. In January 2007 WZL stopped paying the monthly fee of $50,000 invoiced by Monde. By letter dated 16 March 2007, WZL purported to terminate the CSA pursuant to clause 10.2 which provided an entitlement to do so if no EPSA became ''fully operational and enforceable within six months" of the date of the CSA. Of the amounts invoiced by Monde, $700,000 remained unpaid by WZL, which disputed that such amount was due. 12. There is now a dispute between the parties whether WZL was entitled to terminate the CSA on this ground as a matter of construction, or as a matter of fact. There is also now a dispute between the parties as to whether Monde properly performed the services under the CSA during this period, and as to whether WZL ever complained about the performance of the services by Monde. There is also a dispute as to whether in the month or so prior to entering into the Termination Agreement any of these disputes were raised. In a 2013 witness statement, Mr Al- Fekaiki alleges that he had discussions with representatives ofMonde in which he expressed concerns about signing the Termination Agreement because it would involve giving up the 3% option to which Monde remained entitled under the CSA. This suggests that he did at the time treat the termination as invalid. It is disputed by WZL that he did so. It is, however, common ground that a dispute had crystallised at the time as to whether Monde's outstanding invoices totalling $700,000 should be paid by WZL. 13. On 18 April 2007 WZL and Monde entered into the Termination Agreement. By Article 2.1 they agreed to terminate the CSA in consideration for the payment by WZL of Monde's outstanding invoices. Article 2.1 went on to make detailed and comprehensive provision for the surrender by Monde of any and all rights it might otherwise have had in or arising from the CSA, including any claims "with respect to [the CSA] or any other matter relating in any way thereto". By Article 2.2 WZL released Monde in similarly comprehensive terms from any claims by WZL. 14. Clause 3.2 ofthe Termination Agreement provided that: "Notwithstanding the termination of the [CSA], the provisions of Section 5 thereof (Confidentiality) shall continue to apply." 15. Clause 3.3 ofthe Termination Agreement provided: "This Agreement shall be governed by and construed in accordance with the laws of England and Wales. The parties herein irrevocably attorn to the exclusive jurisdiction of the courts ofEngland and Wales." 16. Clause 3.5 ofthe Termination Agreement provided: "This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and shall supersede any and all prior negotiations and understandings. " The procedural background 17. On 4 March 2013 Monde issued the Claim Form in the Commercial Court proceedings against WZL and two of its directors. It did not serve the Claim Form at that stage, but instead served a Letter before Claim dated 31 May 2013. The parties engaged in pre-action correspondence, and the time for service of the Claim Form was extended by agreement. It was served in amended form on 25 October 2013 (the directors having been removed as defendants), and the Particulars of Claim were served on 23 December 2013. 18. In the Commercial Court proceedings Monde alleges that it was induced to enter into the Termination Agreement by the misrepresentation and/or duress of WZL. In summary, Monde alleges that a Mr Bafel Talabani, acting on behalf of WZL, told Mr Al-Fekaiki that if Monde signed the Termination Agreement, Monde would be granted new rights in any EPSA pursuant to a new agreement. Monde alleges that it agreed to execute the Termination Agreement in reliance on this, and certain other misrepresentations made on WZL's behalf by Mr Talabani. It also alleges that WZL unlawfully threatened to withhold Monde's fees unless it concluded the Termination Agreement. Monde denies that WZL was entitled to terminate the CSA when it purported to do so. Monde claims damages for misrepresentation (in tort and under the Misrepresentation Act 1967) and/or damages for duress, and damages for wrongful termination or repudiation of the CSA. Monde quantifies its alleged losses by the fees it would have been entitled to had the CSA remained in force, together with the value of its rights in relation to the option. The prayer also includes a claim "further or alternatively" for rescission of the Termination Agreement. 19. Shortly after issuing the Claim Form in the Commercial Court proceedings, Monde also commenced an ICC arbitration by a Request for Arbitration dated 8 March 2013, in which it claimed damages for wrongful termination of the CSA. The arbitration claim did not include a claim in relation to the Termination Agreement. In its Request for Arbitration Monde explained that it was commencing the arbitration as a protective measure to prevent the claim being time barred in the event that, contrary to its primary case, the claim could not be pursued in the Commercial Court proceedings, and sought an immediate stay of the arbitration. 20. On service of the Request for Arbitration WZL maintained that many of Monde's claims in both sets of proceedings were within the exclusive jurisdiction of the Tribunal by virtue of the arbitration clause in the CSA. It declined to agree to any stay of the arbitral proceedings, and counterclaimed for declaratory relief on those matters which it said only the Tribunal could decide (and which would, if decided in its favour, be dispositive of Monde's claims in both sets of proceedings), together with a claim for damages for an alleged breach of confidentiality by Monde of the arbitration proceedings. The declaratory relief sought was refined in due course in WZL's Submissions on Relief dated 16 October 2013 in the following terms: "6. WZL accordingly seeks: 6.1 a declaration that the arbitration agreement in clause 13 of the CSA is severable and survives termination of that agreement; 6.2 a declaration that it validly terminated the CSA on written notice on 16 March 2007; 6.3 further or alternatively, a declaration that it could have terminated the CSA for cause in March or April2007; 6.4 accordingly, a declaration that Monde has no further entitlement under the CSA, including with respect to the Alleged Lost Compensation; 6.5 further or alternatively, a declaration that Monde waived or is estopped from seeking to enforce any such rights; 6.6 further or in any event, a declaration that Monde, having withdrawn its claims in this arbitration, is time- barred from reviving any claim under the CSA, including with respect to the Alleged Lost Compensation; 6.7 in any event, a declaration that the Option did not and has never vested, is subject to third party approvals and further agreement and is unenforceable and/or of no value;" 21. The relief identified in paragraph 6.6 reflects the fact that by letter dated 4 October 2013, Monde informed WZL and the Tribunal that it withdrew all its claims in the arbitration. WZL nevertheless maintained that the Tribunal should consider and determine its counterclaim for declaratory relief and its claim for damages for alleged breach of confidentiality. On 9 October 2013 the Tribunal fixed a timetable for the resolution of Monde's jurisdictional challenge and WZL's counterclaims. Monde defended WZL's claims in the arbitration, whilst maintaining its primary position that the Tribunal did not have jurisdiction to hear them. Memorials were exchanged, in addition to various other submissions on jurisdiction and relief. The parties disclosed documents upon which they relied, and served statements of witnesses of fact. A hearing took place before the Tribunal in London on 5, 6 and 7 February 2014, followed by a further day of closing submissions on 3 March 2014. In addition to hearing submissions on jurisdiction, the Tribunal heard evidence from two directors of WZL and Mr AI- Fekaiki for Monde (each of which were cross-examined), on the substantive issues arising on WZL's claims. 22. In the meantime, on 10 December 2013 WZL had issued an application in the Commercial Court proceedings challenging the Court's jurisdiction under CPR Part 11, and seeking a stay of the Commercial Court proceedings in favour of the arbitration under s.9 of the Arbitration Act 1996 (the "Jurisdiction Challenge"). The hearing of WZL's Jurisdiction Challenge was listed for hearing on 19 May 2014 before Hamblen J, at which stage the award of the Tribunal was still awaited. Hamblen J dismissed those aspects of WZL's Jurisdiction Challenge which did not overlap with the jurisdictional issues to be decided by the Tribunal. He adjourned the balance of WZL's Jurisdiction Challenge, to be re-listed once the A ward had been made. 23. The Award was sent to the Parties on 25 July 2014. The Tribunal accepted that it had jurisdiction to determine the claim for breach of confidentiality on the grounds conceded by Monde, namely that the obligations of confidentiality attached to the arbitral process. It dismissed the claim for damages for breach of confidentiality on the merits. Neither party seeks to challenge those conclusions. 24. In relation to WZL's claims for declaratory relief, the Tribunal determined that it had no jurisdiction to determine them. It ordered WZL to pay Monde's costs of the arbitration proceedings assessed in the sum of £381,486.50 and ordered that WZL bear US$ 470,000 of the Tribunal's costs of the arbitration, with Monde to bear the balance of US$ 50,000. 25. WZL issued the s. 67 appeal on 13 August 2014, challenging the decision that the Tribunal lacked jurisdiction and consequently the costs order. 26. By Arbitration Claim 2014 Folio 1060 issued on 4 September 2014, Monde sought an order under s.66 of Arbitration Act 1996, permitting it to enforce the Award (as to costs) as an English Court judgment. Such an order was made on the ex parte application by Flaux Jon 6 October 2014. WZL issued an application to set aside such order on 17 October 2014. The main ground advanced is that which arises in the s. 67 appeal, namely that the Tribunal erred in deciding that it lacked jurisdiction. In addition, allegations of a failure to make full and frank disclosure were advanced (which are disputed by Monde), but WZL did not argue that these were such as to justifY setting aside the enforcement order should the s. 67 appeal fail. Accordingly that application stands or falls with the s. 67 appeal. The Issues 27. Section 67 of the Arbitration Act 1996 provides: "67 Challenging the award: substantive jurisdiction. (I) A party to arbitral proceedings may (upon notice to the other parties and to the tribunal) apply to the court- (a) challenging any award of the arbitral tribunal as to its substantive jurisdiction; (3) On an application under this section challenging an award of the arbitral tribunal as to its substantive jurisdiction, the court may by order- (a) confirm the award, (b) vary the award, or (c) set aside the award in whole or in part." 28. Section 67(1 )(a) applies both when a tribunal finds that it has jurisdiction and also, as in the present case, when it declines jurisdiction: LG Caltex v China National Petroleum [200 1] 1 WLR 1892 at paragraph [71]. Such challenges involve a full rehearing of the question of the arbitral tribunal's jurisdiction as opposed to a review of its decision; the Court's role is to decide whether or not the tribunal reached the correct decision and not simply to decide whether the tribunal was entitled to reach the decision it did: Azov Shipping Co v Baltic Shipping Co (No 1) [1999] 1 Lloyd's Rep 68; Peterson Farms Inc v C&M Farming Ltd [2004] 1 Lloyd's Rep. 603. 29. The reasoning of the Tribunal on the jurisdiction issue may be summarised as follows: (1) The Tribunal noted that, as matters stand, the Termination Agreement is binding on the parties: Monde accepts that the Court has not yet determined its claims for misrepresentation/duress, and it is WZL's case that the Termination Agreement is valid and binding. The issue therefore falls to be addressed on the basis that the Termination Agreement remains in force and binding on the parties (paragraphs 84 ~ 87). (2) The language of clause 3.2 of the Termination Agreement is not sufficiently clear to bring about the complete termination of the distinct arbitration agreement in clause 13 ofthe CSA (paragraph 93). (3) Nevertheless the scope of the arbitration agreement was very significantly reduced by the Termination Agreement, in particular because given the width of clause 2.1 and 2.2 of the Termination Agreement, there is no possibility of any dispute falling within the scope of the arbitration clause in the CSA (subject to a possible exception in respect of disputes relating to alleged breaches of confidentiality under clause 5 of the CSA, which by clause 3.2 were excluded from the scope of the termination provisions in clauses 2.1 and 2.2). The net effect is that the arbitration agreement is "inoperative". In this respect the case is analogous to Shanghai Foreign Trade Corporation v Sigma Metallurgical Co Pty Limited (1996) 133 F.L.R (NSW). 417, a decision of the Supreme Court ofNew South Wales (paragraphs 88~95, especially at 88, 91). ( 4) It is not necessary to decide the "interesting question" of what the position would be if and when the Termination Agreement were rescinded in the Commercial Court proceedings. If that occurred, the Tribunal could "see some force" in the argument that the restriction in the scope of the arbitration agreement brought about by the Termination Agreement no longer applies and that Monde's claim for damages for the alleged wrongful termination of the CSA was then covered by the arbitration agreement. However in such circumstances there would be no possibility of Monde now falling back on its claims in the arbitration, because they had been withdrawn, and any new claims in arbitration would be time-barred (paragraphs 96-10 I). (5) The Tribunal rejected WZL's argument that Monde was precluded from contesting the Tribunal's jurisdiction by sections 31(1) and 73 of the Arbitration Act and/or an estoppel. There is no challenge to this aspect of the decision. 30. WZL contends that the CSA contains a valid and binding arbitration agreement and WZL's counterclaims for declaratory relief raised in the arbitration fell squarely within the scope of that arbitration agreement. The jurisdiction clause in the Termination Agreement did not terminate, supersede or otherwise render the arbitration agreement in the CSA ineffective or inoperative. By reason of the principle of separability, enshrined in section 7 of the Arbitration Act 1996, clear and express agreement of the parties would be required to terminate, supersede or otherwise cut down the scope of the Arbitration Agreement. There is nothing in the Termination Agreement which has that effect. Where there are concurrent and potentially over-lapping dispute resolution clauses, the correct approach is for the court or tribunal to construe the dispute resolution agreements in issue, giving effect to clear language, even if this may result in a degree of fragmentation of disputes between the parties to those agreements. The arbitration agreement in the CSA and the jurisdiction clause in the Termination Agreement, on their proper construction, do not overlap in scope; alternatively the arbitration clause is the applicable one as being closer to the centre of gravity of WZL's counterclaims. There was a strong commercial rationale for the parties' choice of arbitration under the CSA, namely their mutual desire for confidentiality. The effect of the Tribunal's decision, based on an incorrect construction of the Termination Agreement and misplaced reliance on a single first-instance Australian authority, is that that choice is rendered nugatory by the Termination Agreement even though the Termination Agreement did not expressly purport to limit or terminate the parties' choice of arbitration as the appropriate means of dispute resolution. 31. Monde contends that on the true construction of the jurisdiction clause in the Termination Agreement, it was intended to supersede the arbitration agreement in its entirety. Such a construction is dictated by (1) the presumption in favour of one stop adjudication; (2) the fragmentation which would otherwise arise between claims and issues which would be required to be brought in separate forums; (3) the language of the jurisdiction clause, in particular the verb "attorn"; and (4) the terms of the arbitration clause in the CSA which envisage that a dispute will not be arbitrable if it has arisen and been the subject of an amicably negotiated settlement within 60 days. Alternatively, even in the absence of the jurisdiction clause in the Termination Agreement, there was nothing for the arbitration clause to bite on by reason of clause 2 of the Termination Agreement so that the arbitration agreement was correctly held by the Tribunal to be inoperable. 32. Both parties contended that the issue ultimately depended upon the construction of the jurisdiction clause in the Termination Agreement, but urged different approaches to such construction. Each contended that clear and express language would have been required for the clause to have the effect proposed by the other. Analysis and conclusion 33. The leading modem authority on the construction of dispute resolution clauses is the decision of the House of Lords in Fiona Trust & Holdings v Privalov & others [2007] Bus LR 1917 [2008] 1 Lloyd's Rep 254, in which it was held that arbitration clauses in a series of time charters governed claims for rescission of the charters on the ground of bribery. In the leading speech Lord Hoffmann emphasised that it is to be presumed that rational businessmen who are parties to a contract intend all questions arising out of their legal relationship to be determined in the same forum; and that the presumption is a strong one, and requires clear words to the contrary if it is to be displaced: see paragraphs [6]-[7] and [13]. This is what, as Hoffmann LJ in Harbour Assurance Co (U.K.) Ltd v Kansa General International Assurance Co [1993] QB 701 at p. 726B, he had characterised as the ''presumption in favour of one-stop adjudication". Lord Hope observed at paragraph [26] that a dispute resolution clause is not one that parties tend to focus on during contractual negotiations, and so Courts will be wary of placing too much weight on particular forms of words, so as to exclude certain disputes from its scope. 34. The presumption applies as much to a jurisdiction clause as to an arbitration clause: see Continental Bank N.A. v Aeakos Compania Naviera S.A. [1994] 1 WLR 588 at pp. 592F to 593G. 35. Where there is more than one agreement between the same parties, and they contain conflicting dispute resolution provisions, the presumption of one stop adjudication dictates that the parties will not be taken to have intended that a particular kind of dispute will fall within the scope of each of two inconsistent jurisdiction agreements. They will fall to be construed on the basis that they are mutually exclusive in the scope of their application, rather than overlapping, ifthe language and surrounding circumstances so allow: see Deutsche Bank AG v Sebastian Holdings Inc (No 2) [2011] 2 All ER (Comm) 245 per Thomas LJ at paragraph [41] and UBS AG v HSH Non/bank [2009] 1 CLC 934 per Lord Collins at paragraph [84). 36. Nevertheless the possibility of fragmentation may be inherent in the scheme of the parties' agreements and clear agreements must be given effect to even if this may result in a degree of fragmentation in the resolution of disputes between the parties. At paragraph [49] of his judgment in Deutsche Bank v Sebastian Holdings, Thomas LJ approved a passage from Dicey Morris & Collins on the Conflict of Laws which is in the following terms (omitting the citation of authorities). 'But the decision in Fiona Trust has limited application to the questions which arise where parties are bound by several contracts which contain jurisdiction agreements for different countries. There is no presumption that a jurisdiction (or arbitration) agreement in contract A, even if expressed in wide language, was intended to capture disputes under contract B; the question is entirely one of construction ... The same approach to the construction of potentially-overlapping agreements on jurisdiction (but there will, in this respect, be no difference between the construction of agreements on jurisdiction, arbitration agreements and service of suit clauses) was taken in [UBS] ... In the final analysis, the question simply requires the careful and commercially-minded construction of the various agreements providing for the resolution of disputes, the point of departure being that agreements which appear to have been deliberately and professionally drafted are to be given effect so far as it is possible and commercially rational to do so, even where this may result in a degree of fragmentation in the resolution of disputes. It may be necessary to enquire under which of a number of inter-related contractual agreements a dispute actually arises; this may be answered by seeking to locate its centre of gravity. The same approach, namely to focus on the commercially- rational construction, governs the interpretation of agreements on jurisdiction as exclusive or nonexclusive, and of agreements which specifically provide that the parties will not take objection to the bringing of proceedings if proceedings are brought in more courts than one.' 37. At paragraph [50] Thomas LJ summarised the approach as follows: [50] I therefore tum to the construction of the agreements in issue focusing on finding the commercially rational construction and giving effect to clear agreements, even if this may result in a degree of fragmentation in the resolution of disputes between parties to the series of agreements." 38. The presumption in favour of one-stop adjudication may have particular potency where there is an agreement which is entered into for the purpose of terminating an earlier agreement between the same parties or settling disputes which have arisen under such an agreement. Where parties to a contractual dispute enter into a settlement agreement, the disputes which it can be envisaged may subsequently arise will often give rise to issues which relate both to the settlement agreement itself and to the previous contract which gave rise to the dispute. It is not uncommon for one party to wish to impeach the settlement agreement and to advance a claim based on his rights under the previous contract. In such circumstances rational businessmen would intend that all aspects of such a dispute should be resolved in a single forum. Where the settlement/termination agreement contains a dispute resolution provision which is different from, and incompatible with, a dispute resolution clause in the earlier agreement, the parties are likely to have intended that it is the settlement/termination agreement clause which is to govern all aspects of outstanding disputes, and to supersede the clause in the earlier agreement, for a number of reasons. Firstly it comes second in time and has been agreed by the parties in the light of the specific circumstances which have given rise to the disputes which are being settled and/or the circumstances leading to the termination of the earlier agreement. Secondly it is the operative clause governing issues concerning the validity or effect of the termination/settlement agreement and therefore the only clause capable of applying to disputes which arise out of or relate to the termination/settlement agreement. Thirdly, in considering any dispute about the scope or efficacy of a settlement or termination agreement, the tribunal is likely to have to consider the background, of which an important element will often be the circumstances in which the dispute arose and the rights of the parties under the earlier contract. There will therefore often arise a risk of inconsistent findings if the tribunal addressing the validity or efficacy of the termination/settlement jurisdiction is not seised of disputes arising out of the earlier contract and the latter fall to be determined by a different tribunal. 39. In such circumstances, therefore, the dispute resolution clause in the termination/settlement agreement should be construed on the basis that the parties are likely to have intended that it should supersede the clause in the earlier agreement and apply to all disputes arising out of both agreements. Whether it does so in any particular case will depend upon the language of the clause and other surrounding circumstances. 40. The risk of fragmentation which is inherent in any other approach is well illustrated by the circumstances of this case. Mr Isaacs QC accepted that the only forum in which the issue of the validity of the Termination Agreement could be resolved was the Commercial Court proceedings. The claims for misrepresentation and duress include issues as to what rights Monde had under the CSA at the date of the Termination Agreement because they are an integral part of Monde's quantification of its loss. If WZL's argument were right, the liability issues would have to be determined in the Commercial Court and the loss issues in arbitration. Mr Isaacs suggested that the loss issues would have to be dealt with first because if there were no loss, the claims for misrepresentation and duress could not succeed. But the reverse is equally true: the claim would fail if Monde were right on the loss issues but could not validly impugn the Termination Agreement for misrepresentation or duress. There is no obvious reason why the liability issues to be determined in the Commercial Court should await resolution of the loss issues in an arbitration, and good reason why they should not: the parties are to be presumed to have wanted their disputes resolved by a single tribunal as swiftly as possible. Such fragmentation is productive of increased expense and delay. Moreover it gives rise to a risk of inconsistent findings because the Commercial Court will have to consider evidence from the same individuals about the operation of the CSA and the circumstances of its termination in order to resolve the liability issues of misrepresentation and duress as would have to be considered by an arbitration tribunal in determining the status of the parties' rights under the CSA at the date of the Termination Agreement. Determination of Monde's allegations that it was induced to conclude the Termination Agreement by misrepresentation and/or duress is likely to require consideration of whether WZL was entitled to withhold the US$700,000 alleged by Monde then to be due under the CSA; whether Monde was in material breach of the CSA, such that WZL was entitled to terminate it; whether WZL was entitled to terminate the CSA pursuant to any other provision of Clause 1 0.2; and what the relationship was between Bafel Talabani and WZL and Monde. These issues form the necessary background to the determination of the liability questions on the misrepresentation/duress claims, not only the loss issues. It will be relevant for the Court to consider Mr Al-Fekaiki's subjective perception of his rights in order to address the arguments on duress. All this would overlap with an arbitral tribunal seeking to determine what those rights were, and making an assessment of the evidence of Mr Al-Fekaiki on those issues. The possibility of inconsistent findings is self evident. Further, even if the issues were capable of being neatly allocated to two sets of proceedings, and even if there were no risk of conflicting rulings, the parties would not ordinarily be taken to have intended the increased cost, inconvenience and delay in having to litigate separate aspects of the same dispute in two different forums. 41. Mr Isaacs relied upon the decision of Cooke J in DDT Trucks of North America Ltd v DDT Holdings Ltd [2007] 2 Lloyd's Rep 213 as authority for the proposition that because of the principle of separability of an arbitration agreement from the matrix agreement in which it sits, an agreement which terminates an earlier agreement will not terminate the operation of the arbitration agreement in the earlier agreement in the absence of clear and specific language to that effect. In that case the parties had entered into a distributorship agreement containing an arbitration clause and entered into a subsequent agreement (the "airport agreement") terminating the distributorship agreement. One party brought a claim in arbitration for compensation due under the distributorship agreement alleging that the airport agreement was a nullity as not having been signed by the same entity which was a party to the distributorship agreement and/or that the airport agreement had been procured by fraudulent misrepresentation. The other party, "Holdings", objected to the arbitrator' s jurisdiction on the grounds that the airport agreement terminated the arbitration agreement in the distributorship agreement. The arbitrator held that the airport agreement was ineffective on both grounds advanced. Holdings sought to appeal under s. 67 out of time. In refusing to extend time, Cooke J concluded that irrespective of the status of the airport agreement, nothing in it impeached the continued existence of the arbitration agreement in the distributorship agreement, so that a section 67 appeal was doomed to failure. He said: [15). ... I cannot see that the arbitrator's jurisdiction would be in any way affected by the termination of the Distributorship Agreement. It was argued by Mr Berragan, who appeared for Holdings, that the 4 November 1999 Airport Agreement brought the Distributorship Agreement to an end and terminated all rights to compensation under schedule 3 with the result that there was nothing left to arbitrate about and no possibility of triggering an arbitration by a failure to agree on such compensation. The right to a compensatory payment and the right to arbitrate in default of agreement about such a figure both came to an end. 16. I am unable to accept that submission. The terms of section 7 of the Arbitration Act 1996 provide that "unless otherwise agreed by the parties, an arbitration agreement which forms ... part of another agreement. .. shall not be regarded as invalid, non-existent or ineffective because that other agreement is invalid, or did not come into existence or has become ineffective, and it shall for that purpose be treated as a distinct agreement". This is a statutory codification of the well recognised position which existed prior to the Act - see Harbour Assurance Co (UK) Ltd v Kansa General international insurance Co Ltd [1993] 1 Lloyd's Rep 455. If the Distributorship Agreement had been brought to an end by accepted repudiation or frustration, the Arbitration Agreement would continue in being in order to deal with issues of compensation, should such arise. It is nothing to the point that the assignment of assets by Holdings occurred after the termination of the Distributorship Agreement, since the allegation is made that compensation is due under the agreement. Whilst the effect of the Airport Agreement, if binding and effective, would be to negate any claim, it would not of itself bring the Arbitration Agreement to an end once a claim for compensation, which could not be agreed, was made. In my judgment there was no agreement to bring the Arbitration Agreement to an end within the meaning of section 7, when the Distributorship Agreement was allegedly brought to an end and Holdings could point to no wording which suggested that this was the case." 42. That was not however a case in which there was a new dispute resolution clause in the terminating agreement, or any risk of fragmentation of issues. Where the terminating agreement contains a new dispute resolution provision which differs from that in the agreement which it terminates, different considerations arise. It is then necessary to determine which dispute resolution clause applies and it is likely that the parties should wish the earlier dispute resolution provision, in the form of an arbitration agreement, to be superseded for the reasons I have endeavoured to identify. Whether that is so will depend upon the proper construction of the clause in the terminating agreement in all the surrounding circumstances, but I would not accept that it could only have that effect by making express reference to termination of the arbitration agreement and DDT Trucks is not authority for any such proposition. 43. Nor is a different approach dictated by the dictum of Lord Hope at paragraph 35 in Fiona Trust v Privalov upon which Mr Isaacs relied: "[t]he doctrine of separability requires direct impeachment of the arbitration agreement before it can be set aside. This is an exacting test. The argument must be based on facts which are specific to the arbitration agreement. Allegations that are parasitical to a challenge to the validity to the main agreement will not do". 44. A termination or settlement agreement which contains no new dispute resolution clause is unlikely to be treated as a direct impeachment of an arbitration clause in an earlier agreement, in the absence of clear language, because it is directed merely at a challenge to the continued substantive rights under the matrix agreement, not the separate arbitration agreement within it. But a new and inconsistent dispute resolution provision will raise the presumption that the parties intended to impeach not just the earlier agreement but also the dispute resolution agreement within it and so go directly to impeach the arbitration agreement. This is not a failure to give effect to the doctrine of separability, but the reverse: it recognises that a dispute resolution provision in the second agreement raises a presumption that the parties intended to address the separate arbitration agreement within the earlier agreement because both clauses are concerned with how and where disputes are to be resolved and in this respect are in conflict. 45. The language of clause 3.3 of the Termination Agreement is supportive of the presumption that the parties intended it to supersede the arbitration clause in the CSA in three respects. First it is expressed to be an exclusive jurisdiction clause and therefore is to be construed as excluding, rather than sitting alongside, any other dispute resolution agreement between the parties. 46. Secondly, although the clause is silent on the subject mater of what is to be submitted to the exclusive jurisdiction of the courts of England and Wales, because there is no object of the verb "attorn", the entire agreement provision in clause 3.5 suggests that what the parties had in mind was at least as wide as disputes "with respect to the subject matter hereof'. Such a formulation would include disputes as to what rights were extant under the CSA at the time of the Termination Agreement because such rights are the subject matter of the waiver and release provisions in clause 2 of the Termination Agreement. If clause 3.5 were not a legitimate guide to what the parties intended to be governed by the verb "attorn" in clause 3.3, nevertheless following the approach in dictated by Fiona Trust v Privalov, the clause is to be construed as governing the broadest range of potential disputes as might arise between the parties. Clause 3.3 is in this respect analogous to the jurisdiction clause in Continental Bank v Aeakos, which was similarly silent as to its subject matter, to which the Court of Appeal gave a wide construction so to include all disputes in connection with the agreement, in order to avoid what Steyn LJ described as the "forensic nightmare" of claims involving similar facts being tried in two different jurisdictions. 47. Thirdly, the verb "attorn" is suggestive of a transfer of jurisdiction not merely a conferment of jurisdiction. In English law attornment is an expression used to signify an acknowledgement by a tenant that he holds a tenancy from a new landlord (Cornish v Searell (1828) 8 B & C 471 per Holroyd J at 476: "the attornment is the act of the tenant's putting one person in the place of another as his landlord"); or an acknowledgement by a bailee that he holds goods for a new owner (see Halsbury 's Laws 51h Edn Vol 4 paragraph 3 and the cases there cited). In the Shorter Oxford English Dictionary (5111 Edn) "a/lorn' is defined as to "turn over (goods, service, allegiance, etc) to another; transfer, assign". 48. Ms Campbell sought to derive further assistance from the fact that clause 13.2 only brought within the scope of the arbitration clause disputes which had not been amicably resolved through negotiation within 60 days. This is neutral for the purposes of the current debate. Putting on one side any potential effect of clause 3.3 of the Termination Agreement, if an amicably negotiated settlement can be impugned, the pre existing dispute remains within the scope of what the parties have agreed in clause 13.2 to submit to arbitration. Clause 13.2 also governs a dispute as to whether an alleged settlement can be impugned just as much as to the issues giving rise to the dispute which was allegedly settled. In the absence of any newly agreed dispute resolution clause in the settlement agreement, the arbitration agreement in clause 13.2 encompasses the entirety of the parties' dispute. Whether or to what extent the scope of that agreement is superseded by clause 3.3 of the Termination Agreement is a matter of construction of the latter clause, which is not informed by the structure of clause 13.2 of the CSA. 49. What the Tribunal referred to as the "interesting question" which would arise if the Court determines that the Termination Agreement should be rescinded is easily resolved. In practice Monde is unlikely to seek rescission in the absence of an ability to prove loss for the purposes of its damages claim, because it would derive no benefit from such relief and would risk an argument that it was obliged to repay some or all of the $700,000, so that the question is unlikely to arise. Should it do so, there is no difficulty with the concept of the Court having exclusive jurisdiction to decide the disputes. Clause 3.3 of the Termination Agreement is a jurisdiction agreement which is separable from the Termination Agreement in which it sits, in the same way as an arbitration agreement is separable, such that the setting aside of the Termination Agreement for misrepresentation or duress does not entail an impeachment of the separate jurisdiction clause: Deutsche Bank AG v Asia Pacific Broadband Wireless Communications Inc [2009] 2 All ER (Comm) 129 per Longmore LJ at paragraphs [24]-[26]. 50. For these reasons the Tribunal correctly held that it had no jurisdiction in relation to WZL' s counterclaims for declaratory relief and the section 67 appeal fails. 51. Ms Campbell's alternative argument, based on the scope of clause 2 of the Termination Agreement and an analogy with the Shanghai case, is not in my view well founded. For these purposes one must assume, contrary to my earlier conclusions, that clause 3.3 of the Termination Agreement does not supersede clause 13 .2 of the CSA. On that hypothesis, the release and waiver of all claims under clause 2 of the Termination Agreement would not affect the separate arbitration clause in the CSA. Clause 2 of the Termination Agreement does not, in Lord Hope's words, go directly to impeach the separate arbitration agreement and is not based on facts which are specific to the arbitration agreement, but merely on a challenge to the existence of surviving rights and claims under the CSA. Those are matters which remain within the jurisdiction of the arbitrators to decide, albeit that they might decide that there were no continued substantive rights under the CSA. That would be a finding to be made in the exercise of the Tribunal's jurisdiction, and would require a substantive determination of the validity of the Termination Agreement. In this respect the position would be analogous with that in DDT Trucks in which Cooke J confirmed the jurisdiction of the arbitral tribunal. If, contrary to my earlier conclusions, clause 3.3 of the Termination Agreement does not supersede clause 13.2 of the CSA, clause 2 cannot have that effect and the fact that it may remove some or all potential disputes from engaging clause 13.2 does not deprive the Tribunal of jurisdiction to decide that question under section 30 of the Act. 52. If the Termination Agreement had no separate and inconsistent jurisdiction clause this would give rise to no difficulty: the Tribunal would be seised of the issues as to the validity and effect of the Termination Agreement, including Monde's claim for damages. Difficulty only arises if clause 3.3 of the Termination Agreement is given limited scope and is to be treated as leaving in place the Tribunal's jurisdiction in parallel with, or overlapping, the jurisdiction of the Court. 53. Shangai v Sigma was concerned with an application to the court for a stay under provisions of the Australian Arbitration Act which differ from those of the 1996 Act, and is of no assistance on an issue which even on the alternative hypothesis here being considered, does not arise. It is not necessary for the purposes of the present application to decide whether if the arbitration clause survived, the Court on an application to stay under s. 9 of the Act would exercise its discretion in relation to s. 9(4) to determine or order a trial ofthe issue whether clause 2 ofthe Termination Agreement rendered the arbitration agreement "inoperable", or whether it would leave such issue to the undoubted jurisdiction of the Tribunal under section 30 of the Act (see the discussion at Golden Ocean Group Ltd v Humpuss Intermoda Transportai Tbk Ltd [2013) 1 CLC 929 paragraphs [48]- [59) and Joint Stock Co Aerojlot v Berezovsky [2013] 2 CLC 206 at paragraphs[77]- [80]). Where, as here, the issue is before the arbitrators, and on the hypothesis that contrary to my earlier conclusion the arbitration clause survives clause 3.3 of the Termination Agreement, the issue of whether any disputes remain which fall within the scope of the arbitration clause would be within the Tribunal's jurisdiction and would fall to be decided by the Tribunal. That would involve the Tribunal deciding whether the Termination Agreement was valid and effective. Given the existence of the inconsistent jurisdiction provision in clause 3.3 of the Termination Agreement, such duplication merely serves to illustrate why it is to be presumed that the parties intended clause 3.3 to supersede the arbitration clause. Security for costs 54. WZL's application for security for the costs of the Commercial Court proceedings invokes two of the conditions in CPR Rule 25.13(2) namely that Monde is resident outside the jurisdiction (CPR 25.13(2)(a)) and that Monde is a company and there is reason to believe that it will be unable to pay WZL's costs if ordered to do so (CPR25.13(2)(c)). Monde accepts that the second of these provides a potential ground for ordering security, but contends that it would not be just to do so for two reasons. The first is that WZL has not paid the costs which the Tribunal awarded should be paid by WZL to Monde. The second is that WZL advanced its claims in the arbitration without having to provide to Monde the benefit of any security for the costs of defending those claims; that those claims raise issues which are the same as, or at least overlap substantially with, the issues which will arise in the Commercial Court proceedings, namely whether the CSA was validly terminated by WZL, or could have been validly terminated on other grounds; and that the position is therefore analogous with cases in which the Court will decline to order security where a claim and counterclaim cover the same subject matter and it is a matter of happenstance as to who has commenced the proceedings. 55. As to the first ground, WZL has made clear in correspondence that it was withholding payment of the costs payable under the Award pending determination of its s.67 appeal, and that if such appeal failed it would pay the amount awarded. This was a reasonable approach given the likely overturning of the costs award should the s. 67 appeal succeed, and Monde's financial position. 56. As a term of an order made by consent on I October 2014, whereby Monde agreed to withdraw a winding up petition, WZL's solicitors, King & Spalding International LLP, undertook that they would hold the sum of £396,579.50 in their client account until determination of the outstanding appeal in relation to the costs award. On behalf of WZL, Ms Byrne suggested that the sum so held could simply be treated as security, in part, for the costs of the Commercial Court proceedings. This is not satisfactory, since the sum is payable in respect of costs already incurred by Monde in the arbitration, and Monde or its legal advisors could potentially be prejudiced by the sum not being paid as awarded. However Monde's objection on this first ground can be met by ordering that the costs award should be paid to Monde as a condition of any order for the provision of security for costs by Monde. 57. As to the second ground, the analogy between cases in which the subject matter of the claim and counterclaim are identical or overlap is not an apposite one. The Commercial Court proceedings will involve determination of the grounds on which Monde impugns the validity of the termination agreement, and in particular the allegations of misrepresentation and/or duress, which did not arise in the arbitration. Moreover insofar as there is an overlap between issues, once the costs award has been paid, Monde will have been put in as good a position as if it had had security for those costs. 58. Accordingly security should be provided. As to the amount, I propose to order security only in relation to the period up to the exchange of witness statements in view of the relatively early and undeveloped stage which the proceedings have currently reached. In approaching the task of determining the appropriate amount of security I have in mind the following principles. Under CPR 25.13(1)(a) the court's discretion to award security is a discretion to award it in an amount which it considers just having regard to all circumstances of the case. The appropriate amount will generally be the amount that the court considers the applicant would be likely to recover on a detailed assessment if awarded its costs on a standard basis following the trial: see for example Procon (Great Britain) Limited v Provincial Building Co. Limited [1984] 1 WLR 557. On such an assessment the defendants will recover such costs as are reasonably and proportionally incurred, and reasonable and proportionate in amount having regard in particular to the factors which are set out in CPR Rule 44.4(3). It is not the task of the court when hearing an application for security to undertake an exercise which is similar to a detailed assessment. It is necessary to approach the evidence about the amount of costs which have been and will be incurred, and their reasonableness or otherwise, on a robust basis and applying a broad brush: see Rymer LJ at paragraph 16 of Meridian International Services Limited v Richardson and Others [2008] EWCA Civ 490 and Black LJ at paragraph 64 of Autoweltl Systems Limited v Kito Enterprises LLC [2010] EWCA Civ 1469. 59. I heard a number of detailed points on the schedule of estimated costs put forward on behalf of WZL which I have taken into account, without it being necessary to set them out. I propose to award security in a total amount of £220,000 to cover the period up to exchange of witness statements, a figure I have reached as follows: (1) £20,000 in relation to preliminary tasks which are those relating to the issues in the Commercial Court proceedings which do not overlap with those which have already been the subject matter of WZL's claims for declaratory relief in the arbitration; (2) £50,000 in relation to statements of case; (3) £30,000 in relation to pre-trial applications. Those exclude any costs in relation to jurisdiction challenges, on which WZL has failed, or any of the costs for the security for costs application which will be dealt with by way of separate order; ( 4) £70,000 in relation to disclosure; (5) £50,000 in relation to preparation of factual witness evidence. 60. There was a dispute as to the form in which any security should be provided. On behalf of Monde it was submitted that it could be provided by an undertaking by Monde's solicitors, Candey Ltd, which is a limited liability company, supported by a personal guarantee by Mr Candey. 61. It is conventional to order security to be given either by payment into Court or by the provision of a guarantee from a first class London bank. That practice recognises that the security should be in a form which enables the defendant to recover a costs award made in its favour at the trial from funds which are readily available, such that there is little risk of delay or default in enforcement. Although security may be ordered in an alternative form, that form should be such as to fulfil the same function, so as to allow simple and swift enforcement of a costs order from a creditworthy source. In practice any such alternative form of security must be such as can properly be regarded in these respe~.:ts as at least equal to, if not better than, security by payment into Court or provision of a first class London bank guarantee. See Be/co Trading Co. v Condo [2008] EWCA Civ 205 at paragraphs [6] to [9] and Versloot Dredging BV v HDI Gerling Industrie Versicherung AG [2013] EWHC 658 (Comm) at paragraph [10]. 62. The form of security offered by Monde does not fulfil these criteria. The evidence put forward about Candey Ltd's financial position is unsatisfactory. In particular there are no audited accounts, and the unaudited accounts to 31 March 2014 have only been supplemented in relation to the subsequent 9 months by evidence which does not disclose the asset position of the company. The company advertises itself as undertaking work on a predominantly no win no fee basis, and its cash position at the end of a trial must remain a matter of uncertain speculation. 63. It is no doubt in recognition of this deficiency that Monde proffers the support of a personal guarantee by Mr Candey. However the only information about his assets comes in a witness statement, unsupported by any documentation, that he and his wife jointly own the unencumbered equity in their house which is in excess of £3 million. Assuming that to be so, nevertheless the position may have changed at the time that an order for costs in the defendant's favour comes to be enforced after conclusion of a trial. Moreover enforcement against a domestic residential property may tum out to be neither swift nor staightforward, especially given the wife's interest in the property. 64. Accordingly I will order security to be provided in the usual form by payment into court or provision of a guarantee from a first class London bank.