Enforcing arbitral awards in England6. Juni 2019
Mark Baldock initially studied Classics at the University of Cambridge before converting to law and reading for the Bar. During his legal studies, he was a visiting lecturer at City, University of London and a researcher for a leading set of Barristers’ Chambers in London. Below he examines all relevent issues regarding the enforcement of arbitral awards in England.
Mark was called to the Bar by the Honourable Society of Gray’s Inn earlier this year. After finishing the LL.M. in International Dispute Resolution at the Humboldt University of Berlin, he will return to London to undertake a pupillage at a leading set of commercial Chambers.
The views expressed here are those of the author. Nothing in this document should be read or interpreted as constituting any form of legal advice.
Among respondents to the 2018 Arbitration Survey, conducted by White and Case and the School of International Arbitration, Queen Mary, University of London, London was shown to be the most preferred seat of arbitration (White and Case and the School of International Arbitration, Queen Mary, University of London, 2018 International Arbitration Survey: The Evolution of International Arbitration (9 May 2018), p. 9, chart 6).
Furthermore, the London Court of International Arbitration (LCIA), England’s main institution, was shown by the same survey to be the second most preferred (Id., p. 13, chart 12). The LCIA’s 2018 Annual Casework Report recorded that, in that year, the LCIA recorded a record number of cases – 317 referrals in total (London Court of International Arbitration, 2018 Annual Casework Report (2018), p. 2, available at www.lcia.org/media/download.aspx?MediaId=772 [last accessed 31 May 2019]). It is safe to conclude that England is a thriving arbitration hub. The impact of the UK’s impending exit from the European Union on international commercial arbitration in London, however, remains to be seen (see e.g. N. Schmidt-Ahrendts and A. De-Jong, ‘The “Right” Place of Arbitration: How Germany Might Profit from Brexit’, (2018) SchiedsVZ 16(5) 281).
What is the applicable procedural law/arbitration act for recognition and enforcement of an arbitral award in your jurisdiction and which is the relevant Section?
The applicable statute is the Arbitration Act 1996 (“the 1996 Act”). As for the relevant provisions of the statute, the following should be noted:
- section (“s.” or “ss.”) 66 of the 1966 Act deals with the general summary procedure for enforcement of awards;
- 100 – 104 contains provisions relating to New York Convention Awards; and
- Part II of the Arbitration Act 1950, which continues to apply by virtue of s. 99 of the 1996 Act, contains provisions relating to Geneva Convention Awards that are not New York Convention awards.
Is your jurisdiction party to the 1958 New York Convention? If yes, what is the date of entry into force of the Convention? Was there any reservation made under Article I (3) (reciprocity reservation) of the Convention?
The United Kingdom acceded to the New York Convention (“the Convention”) in 1975 and the provisions therein are given full effect by ss. 100 – 104 of the 1996 Act.
On 5 May 1980, the UK made a reciprocity declaration.
Jurisdiction & procedure before court
Which national court has jurisdiction over an application for recognition and enforcement of arbitral awards?
A claim to enforce an arbitration award under ss. 66 or 101(2) may be commenced in the High Court or in any county court (see s. 105 of the 1996 Act). The choice of venue depends on internal rules of allocation. In international matters, given the sums at stake, applications are normally made to the High Court.
How does one initiate court proceedings for the enforcement of an award in your home jurisdiction?
Proceedings relating to arbitration are commenced by way of an arbitration claim form (form N8), which must comply with the requirements of the appropriate practice direction on arbitration (see, generally, Practice Direction 62, available at www.justice.gov.uk/courts/procedure-rules/civil/rules/part62/pd_part62 (last accessed 7 May 2019).
Are there any requirements for the court to have jurisdiction over an application for recognition and enforcement of arbitral awards? If yes, what are they? Must the applicant identify assets within the jurisdiction of the court?
There are no specific jurisdictional requirements.
How high are the court fees that must be paid? What kind of criteria is used to determine their amount? Amount in dispute? Or are there also other criteria?
A fee of £66 must accompany an application for permission to enforce an arbitration award.
How are the costs of the enforcement proceedings allocated?
Generally, a successful claimant would expect to recover the costs of the application and the proceedings up to, and including, the making of the order. Costs are a matter of discretion and, in some cases, a successful claimant may recover further costs. An example is provided by Caucedo Investments Inc v Saipem SA (formerly Bouygues Offshore SA)  EWHC 3375 (TCC) where a defendant, who refused to accept service of an order enforcing an arbitration award against it in the UK, was ordered to pay the increased costs of serving out of the jurisdiction.
Are the proceedings in your jurisdiction adversarial or ex parte?
An application for leave to enforce an award can be made ex parte or on notice. When an application is made ex parte, the court will not permit enforcement until the respondent has been served with the order and has had the opportunity to challenge it.
Formal and practical requirements
What documentation is required to obtain recognition of an arbitral award? For instance, must the award be submitted in original or a certified copy? Does the original arbitration agreement have to be submitted?
- 102(1) of the 1996 Act requires that the party seeking enforcement must provide both the award and the original arbitration agreement or certified copies thereof.
If the required documentation is drafted in another language than the official language of your jurisdiction, is it necessary to submit a translation together with an application to obtain recognition of an arbitral award? If yes, in what form is the translation required to be?
Section 102(2) of the 1996 Act provides that, if the award or agreement is in a foreign language, the applicant must also produce a translation certified by an official or sworn translator or by a diplomatic or consular agent.
What are the other practical requirements relating to recognition and enforcement of arbitral awards? For instance, do you need to be represented by a lawyer from the particular jurisdiction?
There are no such requirements. In fact, a party seeking to enforce an arbitral award may appear as a litigant in person.
When is service of judicial and extrajudicial documents deemed to be effected in your home jurisdiction and what does the procedure and legal framework look like? What about service to a party outside of your jurisdiction?
Service is dealt with by Part 6 of the Civil Procedure Rules (“CPR”). The CPR makes a distinction between service of the claim form and service of other documents. In terms of serving the claim form within the jurisdiction, CPR r. 6.3 provides that, except where the court orders otherwise, service may be effected by several means, including personal service and service by first class post. According to CPR r. 6.14, service is deemed to be effective on the second business day after the appropriate step – which is specified in CPR r. 7.5 – was taken. For example, where the claim form is posted by first class on the Monday, the deemed date of service is the Wednesday of the same week.
As for service of documents within the jurisdiction, CPR r. 6.20 provides a number of methods of service. The deemed date of service of a document depends on the method of service and, accordingly varies (see CPR r. 6.26). For example, where documents are served by fax, if the transmission of the fax is completed on a business day before 4.30pm, the deemed date of service is the same day (CPR r. 6.26.4).
Service outside of the jurisdiction is a different kettle of fish. CPR r. 62.18(4) provides that the claimant may only serve the claim form out of the jurisdiction with the court’s permission. A court order giving permission to enforce an award may be served out of the jurisdiction without the permission of the court (CPR r. 62.18(8)).
The conventions relating to the service of judicial documents to which the UK is a party are reflected in the CPR. For example, the methods of service provided by the Hague Service Convention are reflected in CPR r. 42(1) and the related procedure can be found in CPR r. 43. Thus, the first question is always whether a convention or treaty applies. Where it does not, CPR rr. 6.42(2) and 6.43 govern the method and procedure for service respectively.
Are there any differences in the procedure of the enforcement of domestic and foreign arbitral awards?
There are no real substantive differences in the procedure for the enforcement of foreign arbitral awards. The only thing to note is that, in the case of the latter, the official authenticated documentation required by s. 102(1) of the 1996 Act.
Do courts recognize and enforce partial or interim awards or only final awards?
Whether an award is enforceable depends on whether it is an “award” for the purposes of s. 66 or s. 100 of the 1996 Act . In general, an award will be enforceable where it is final; that is where it determines either an issue or all the issues in the proceedings and is not subject to the further review of the tribunal.
What are the grounds on the basis of which an award may be refused recognition? Do the relevant provisions differentiate between domestic and foreign arbitral awards? If yes, what are the differences in their requirements?
Pursuant to s. 103 of the 1996 Act, an New York Convention Award may only be refused recognition on the same grounds set out in Article V of the Convention.
How does your home jurisdiction interpret and construe the public policy violation defense?
The pro-enforcement bias of English courts means that the public policy defence is construed narrowly and that they are reluctant to refuse to enforce an award on this ground. The strength of the public policy in favour of sustaining international arbitration awards was made clear in the judgment of Colman J in Westacre Investments Inc. v Jugoimport-SPDR Holding Co. Ltd and others  QB 740. An example of where such a defence has succeeded is Soleimany v Soleimany  QB 785 where an award was refused recognition on the basis that the underlying purpose of the subject of the arbitral proceedings was illegal.
Effects, remedies & procedural requests
What is the effect of a decision recognizing the award in your jurisdiction? Is it immediately enforceable?
Where enforcement proceedings are contested, a judgment or order of the court in relation to those proceedings takes effect on the day that it is made (CPR r. 40.7). Thus, it is enforceable immediately, unless a stay of execution is granted (see CPR r. 83.7). It should be noted that an appeal does not operate as a stay of execution (CPR r. 52.16).
Where, however, an application has been made ex parte, the respondent has 14 days or, if granted by the court, a longer period, to apply to set aside that order and the award cannot be enforced until either after the end of that period or any application to set aside by the respondent has been finally dealt with (see CPR r. 62.18(9)).
Are any remedies available against a decision recognizing an arbitral award in your jurisdiction and, if yes, what are they?
A court’s decision to grant or deny enforcement is subject, in the same way as any other decision of a court in domestic proceedings, to challenge on appeal. No appeal is available as of right, however, and, as a result, permission to appeal must be sought from either the court which made the decision or the court to which the appeal is to be made (see generally Part 52 CPR).
Further, a party can always apply for a stay of execution, which has the effect of suspending the order to enforce, pursuant to CPR r. 83.7. Generally, a stay is granted either where the court is satisfied that there are “special circumstances which render it inexpedient to enforce the judgment or order; or the applicant is unable from any reason to pay the money” (CPR r. 83.7(4)).
What remedies, if any, are available against a decision refusing to recognize an arbitral award in your jurisdiction?
See first paragraph of answer to question 18.
Are any additional defences such as a set-off claim possible in enforcement proceedings?
In theory, the respondent to an application to enforce an award can rely on set off where the award debtor has a liquidated, ascertainable claim against the award creditor that is due and payable at the commencement of the enforcement action.
Is it possible to obtain the recognition and enforcement of an award that has been fully or partly set aside at the seat of the arbitration? In case the award is set aside after the decision recognizing the award has been issued, what remedies, if any, are available against this decision?
Section 103(2) of the 1996 Act preserves the discretion of the English courts to enforce an award that has been set aside (“may”). One leading commentator notes that, where an award has been set aside, “the English court will usually, but not invariably, recognise that order and decline to enforce the award” (David St John Sutton et al. Russell on Arbitration (23rd Ed., 2015) para. 8-047).
In the circumstances where an award is later set aside or revised after it has already been recognised in England, the decision of the foreign court setting aside the judgment has no affect on the judgment of the English court. However, there are options:
- In the case where the judgment has not yet been enforced, it will be possible to apply for a stay of execution so that enforcement becomes impossible (see 18 above); and/or
- It may be possible to appeal against the judgment/order recognising or enforcing the award; and/or
- It may be possible, in certain circumstances, to commence an action to set aside the judgment.
Are interim measures against assets in your jurisdiction available? And if yes, what kind of measures are they?
Section 37 of the Senior Courts Act 1981 is the source of the High Court’s power to grant interim measures in support of enforcement proceedings (on the relationship between s. 37 of the 1981 Act and s. 44 of the 1996 Act see AES Ust-Kamenogorsk Hydropower Plant LLP v Ust-Kamenogorsk Hydropower Plant JSC  UKSC 35,  1 WLR 1889). Thus, in principle, the whole range of injunctions is available to a potential applicant. In practice, the most popular measure is a freezing injunction. Such an order is granted where there is evidence that the award debtor’s assets would be “dissipated” – i.e. removed from the jurisdiction of the court – if an order were not made.
In which cases may a security for costs be requested?
Section 103(5) of the 1996 Act envisions the ordering of security in favour of the judgment creditor against the judgment debtor. In such cases, the court is likely to have regard, inter alia, to the prima facie strength of the judgment debtor’s grounds for opposing enforcement and the possibility of assets being put beyond the reasonable reach of the claimant. Although not dealt with by the 1996 Act, the judgment debtor can in principle also apply for security against the judgment creditor pursuant to Part 25 of the CPR. However, there appears to be no known case where security has in fact been awarded in favour of a defendant to proceedings seeking to enforce an award under the Convention (see, e.g., Diag Human SE v Czech Republic  EWHC 3190 (Comm),  per Burton J).
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