District of Columbia Court grants motion for summary judgment to enforce arbitral award | Practical Law

District of Columbia Court grants motion for summary judgment to enforce arbitral award | Practical Law

Abby Cohen Smutny (Partner) and Lee A. Steven (Counsel), Leah Witters (Associate), White & Case LLP

District of Columbia Court grants motion for summary judgment to enforce arbitral award

Published on 01 Sep 2011International, USA (National/Federal)
Abby Cohen Smutny (Partner) and Lee A. Steven (Counsel), Leah Witters (Associate), White & Case LLP
The District Court for the District of Columbia has granted a motion for summary judgment in an action to enforce an arbitral award, finding that the party challenging enforcement presented no reason to refuse to enforce the award.
In Continental Transfert Technique Ltd v Federal Government of Nigeria, (D.D.C. Aug. 3, 2011), Continental and Nigeria were parties to an arbitral proceeding in the UK, governed by Nigerian law, which involved a contract dispute. The arbitral panel heard the dispute and required Nigeria to pay an award, denominated in Nigerian naira, to Continental, along with Continental's costs and 95% of the arbitration costs.
Continental sought and was granted recognition of the award in the UK. Nigeria asked the UK court to set aside the award because Nigeria was still challenging the award in a Nigerian court. The UK court stayed enforcement, but required Nigeria to provide a bond (see Legal update, Conditional stay of enforcement of New York Convention award). Both parties did not dispute that this happened.
Continental later filed a complaint to enforce the arbitral award in the US district court and amended its claim to seek enforcement of the UK court award under the District of Columbia Uniform Foreign-Money Judgments Recognition Act 1962 (UFMJRA). After its motion for default judgment was denied in an earlier opinion by the district court, Continental filed a motion for summary judgment. It then filed a status report, attaching the Nigerian court judgment stating that the arbitral award was valid and enforceable.
Nigeria argued that the proceeding in the US district court should be stayed or the complaint dismissed because the Nigerian court proceedings could result in the award being vacated and Nigeria could not challenge the substance of the award anywhere else. The court rejected these arguments because the court's earlier opinion considered, and ultimately rejected, Nigeria's arguments that the matter should be stayed or dismissed because of the Nigerian court proceedings and also because the Nigerian court proceedings were resolved and found the award valid. Thus, the court found "no reason to refuse to enforce the award."
The court then explained that the UFMJRA makes a final, conclusive, and enforceable foreign-money judgment "enforceable in the same manner as the judgment of a sister jurisdiction which is entitled to full faith and credit." The court noted that Nigeria had failed to respond to Continental's argument that the UK court order is enforceable under the UFMJRA. The court found that because Nigeria failed to post the bond required by the stay of proceedings, it could enforce the UK court award.
This case demonstrates the multiple routes and forums available to parties that are seeking enforcement, or challenging enforcement, of arbitral awards.