ENGLISH PRACTICE

In Nomihold Securities Inc v. Mobile Telesystems Finance SA (2012) Andrew Smith J held that an anti-suit injunction (10.23 ff) should be granted to prevent a party from pursuing a second arbitration designed to undermine and contradict the award in an earlier arbitration between the same parties. The judge held:

This decision is sound because the re-litigation would run contrary to the parties’ implied undertaking to adhere to the result of the arbitration in the first reference. Andrew Smith J noted Lord Hobhouse's statement in Associated Electric & Gas Insurance Services Ltd v. European Reinsurance Co of Zurich (2003: see also on this case 18.11 to 18.13): ‘It is an implied term of an arbitration agreement that the parties agree to perform the award’.

The Privy Council in Associated Electric & Gas Insurance Services Ltd v. European Reinsurance Co of Zurich (2003) held that issue estoppel can arise in arbitration, and this will be binding on a second arbitration panel seised with a matter on a related topic between the same parties. There had been earlier cases on issue estoppel in arbitration proceedings (see also 16.27, vol I). It should also be noted that issue estoppel is not quite as exacting as cause of action estoppel: unlike cause of action estoppel, issue estoppel can be relaxed in either of these situations: (i) there has been a retrospective change in the law which renders the point covered by issue estoppel ‘plainly’ wrong; or (ii) new evidence has emerged which ‘entirely changes the aspect of the case’, provided that, even if he had displayed ‘reasonable diligence’, the relevant party could not have discovered this evidence at the time of the earlier litigation (see also 15.73, vol I).

In Nomihold Securities Inc v. Mobile Telesystems Finance SA (2012) Andrew Smith J assumed that the rule in Henderson v. Henderson (16.55 ff, vol I) will apply if in arbitration X between A and B, B could have readily raised issue P, but did not do so; and then in arbitration Y between A and B, B attempted to raise issue P.