In August 2009, the English Commercial Court considered whether section 69 of the Arbitration Act 1996 (the Act) had been excluded by the parties to an arbitration agreement (see Legal update, Meaning of "final, conclusive and binding"). In Shell Egypt West Manzala GmbH and anor v Dana Gas Egypt Ltd [2009] EWHC 2097 (Comm), the claimant applied for permission to appeal an UNCITRAL arbitral award on a point of law under section 69 of the Act. The defendant argued that the statement in the arbitration clause that the arbitral tribunal's award "shall be final, conclusive and binding on the parties..." excluded any rights of appeal that would otherwise arise under section 69 of the Act. Gloster J held that the wording of the parties' arbitration agreement was insufficient by itself, and in the absence of any other contextual indicators, to exclude the application of section 69. The judge went on to grant permission to appeal against the award.

Gloster J's judgment confirms that the mere use of the words "final, conclusive and binding", in whichever order or combination, is unlikely to be sufficient to exclude an appeal under section 69. Parties who wish to derogate from section 69 should therefore err on the side of caution and include clear wording to that effect in their arbitration clauses. It is important to note that, although the LCIA and ICC Rules contain wording designed to exclude all non-mandatory rights of appeal, other arbitration rules to which parties may commonly refer do not contain such wording. Therefore, where parties have chosen such rules, or opted for ad hoc arbitration, additional wording to exclude section 69 will be necessary.

In April 2009, the English Commercial Court considered the ECJ ruling in West Tankers in a dispute about the validity of an arbitration clause, and whether the English or Spanish courts had jurisdiction (see Legal update, Court not bound by Spanish judgment obtained in breach of arbitration agreement). In National Navigation Co v Endesa Generacion SA [2009] EWHC 196 (Comm), the vessel at the centre of the dispute was subject to various charters and a bill of lading contract. The charters contained London arbitration clauses. When a dispute arose, the parties issued a series of applications in the English courts and the Spanish courts. Each party challenged the jurisdiction of the court chosen by the other. The Court of First Instance in Almeria determined that Spanish law applied to the dispute and that the charterparty arbitration clause had not been incorporated in the bill of lading. It also held that the claimant had waived its right to rely on the arbitration clause by commencing separate proceedings in the English Commercial Court.

In the English Commercial Court, Gloster J held that the dispute was referable to arbitration in London, notwithstanding the existence of the Spanish court decision to the contrary. Although the Spanish judgment fell within the scope of the Brussels Regulation, it was not required to be recognised under Article 33 of the Regulation in proceedings in another member state which were not Regulation proceedings. The application before her was for a declaration as to the applicability of an arbitration agreement and, as such, fell within the arbitration exception in Article 1(2)(d) of the Brussels Regulation. There was therefore no requirement for the Spanish court judgment to be recognised in this instance. In the alternative, the judge determined that it would be contrary to public policy in England to recognise a judgment, such as the Spanish decision, obtained in breach of an arbitration agreement that was valid by its proper law. A clear obligation existed under English law for an English court to give effect to such an arbitration agreement. On the facts, the court held that English law applied and that the arbitration agreement was incorporated in the bill of lading and had not been waived.

This decision is significant as it was one of the first to be published in the wake of the ECJ ruling in the West Tankers case (see Legal update, West Tankers ECJ judgment: full report) and it is noteworthy that the judge sought to limit the impact of that decision, effectively protecting the arbitration, in this case. However, doubts that were expressed as to Gloster J's reasoning have been borne out by the fact that an appeal against her decision has just been allowed. A detailed analysis of the Court of Appeal's decision in this case will be provided shortly.

In Dallah Estate and Tourism Holding Company v The Ministry of Religious Affairs, Government of Pakistan [2009] EWCA Civ 755, the Court of Appeal confirmed a Commercial Court decision refusing enforcement of a French ICC award on the grounds that Pakistan was not party to the relevant arbitration agreement and, therefore, there was no valid arbitration agreement within the meaning of section 103(2)(b) of the English Arbitration Act 1996 (the Act) (see Legal update, Court of Appeal upholds decision refusing enforcement of an ICC award).

In disposing of the appeal, the court indicated that a determination as to whether one of the defences to enforcement in section 103 of the Act (and Article V.1 of the New York Convention from which that section derives) is established involves a full rehearing of the relevant issues and not merely a review of the tribunal's decision. Moreover, the court held that there was no requirement for a party successfully to challenge an award in the supervisory court at the seat of the arbitration in order successfully to resist enforcement elsewhere.

The court confirmed that, as a matter of French law, Pakistan was not a party to the relevant arbitration agreement. Further, Pakistan was not estopped from challenging enforcement: the arbitral tribunal was not a court of competent jurisdiction for these purposes as the parties had not agreed to submit to it. The decision of the Court of Appeal is noteworthy as it clarifies the approach to be taken in evaluating whether a ground under section 103 of the Act has been made out and also confirms that there is no requirement for a party to challenge or appeal an award in the courts of the seat of an arbitration before it may attempt to resist enforcement elsewhere.