The Kingdom of Spain v The London Steam-Ship Owners’ Mutual Insurance Association Limited

Tuesday 29 October - Wednesday 6 November 2024
The Kingdom of Spain v The London Steam-Ship Owners’ Mutual Insurance Association Limited
The French State v The London Steam-Ship Owners’ Mutual Insurance Association Ltd
Before The Master of the Rolls
Lady Justice Andrews
Lady Justice Falk
Issue: Whether the Judge was obliged to follow the judgment of the EJEC in circumstances where he took the view that the EJEC had acted ultra vires. Effect of Article 34 Brussels I.
The Case concerns the priority of Judgments and Awards made following a significant oil spill from the vessel MT Prestige in 2002. The Respondent P&I Club was the liability insurer for the Owners of the vessel.
The Club commenced arbitration proceedings before Mr Schaff KC. His award (“the Schaff Award”) granted declarations that:
(1) Spain was bound by the arbitration clause in the Club Rules to refer the non CLC civil claims brought by Spain to arbitration.
(2) That pursuant to the pay to be paid clause in the Club Rules, the Club was not liable in respect of such claims in the absence of prior payment by the Owners and/or Managers of the Vessel of the full amount of any insured liability.
(3) The Clubs liability should not exceed US$1 billion.
The Club applied to have the Schaff Award entered as a judgment of the court pursuant to s66 Arbitration Act and Spain applied to set the Schaff Award aside. Hamblen J dismissed Spain’s application and granted the Clubs Application (“the Hamblin Judgment”).
By a judgment dated 13 November 2013 (after the Hamblin Judgment) the Spanish Court of Appeal held that the Master, Owners and the Club had civil liability to Spain. (“the Spanish Judgment”). Spain applied to enforce the Spanish Judgment pursuant to Brussels I which resulted in the Order of Master Cook dated 28 May 2019. The Club appealed against the Order which was considered by Butcher J.
The Judge held that the Cook Order should be set aside on the basis that the Spanish Judgment was irreconcilable with the s66. Judgment, and that an issue estoppel had arisen out of the s.66 Judgment precluding Spain from relying on the provisions of Brussels I.
It was Spain’s case that the Judge was bound to find in favour of the Spanish Judgment as, on the true construction of Article 34(3) of Brussels I, the s66 Judgment was not a judgement and thus not capable of being an irreconcilable judgment which could prevent recognition of the Spanish Judgment.