General Dynamics United Kingdom Ltd v The State of Libya 2024 EWHC 472 Comm - 22 March 2024
Country
Year
2024
Summary
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Factual Background and Parties' Contractual Relationship
By an agreement in writing made on 5 May 2008, the parties entered into an agreement for the supply by GDUK to SoL of a Tactical Communication and Information System at a price in excess of £84m ("Contract"). The parties agreed that the Contract would be " ... exclusively governed and construed in all aspects in accordance with the Laws of Switzerland..." - see clause 33.1 - and by clause 32 that:
"Disputes/Arbitration
The Parties will attempt to resolve any differences or disagreements by mutual agreement. All disputes in which mutual agreement cannot be reached arising out of or in connection with the present Contract shall be finally settled under the Rules of Arbitration of the International Chamber of Commerce by one (1) or three (3) arbitrators. The award will be final and binding upon the Parties. The seat or legal place of arbitration shall be Geneva, Switzerland. The language to be used in the arbitral proceedings shall be English. The arbitrators shall have no authority to award aggravated or punitive damages and shall be bound by any limits on the PURCHASER's and SELLER's liability as set out in this Contract. The Parties undertake to keep confidential all awards and orders as well as all materials submitted by another party in the framework of the arbitral proceedings not otherwise in the public domain, save and to the extent that a disclosure may be required of a party by a legal duty, to protect or pursue a legal right. Both parties agree that the decision of the arbitration panel shall be final, binding and wholly enforceable." [Emphasis supplied]
A dispute developed between the parties, the detail of which does not matter for present purposes, which was referred to arbitration under the ICC Rules in accordance with the arbitration agreement between the parties contained in clause 32 of the Contract. By an Award published on 5 January 2016, GDUK was awarded £16,114,120.62. On 18 July 2018, Teare J gave GDUK permission under s.101 of the Arbitration Act 1996 ("AA") to enforce the Award as if it was a judgment. Following difficulties with service, there was a challenge to the s.101 order that was dismissed on 11 March 2022 and GDUK became entitled to enforce the Award as if it was a judgment of the High Court unconditionally from 2 April 2022.
On 22 April 2022, GDUK applied for the ICO, contending that either (a) SoL had given written consent by clause 32 of the Contract to enforcement against its property including the Property under SIA, s.13(3) or (b) the Property was in use or intended for use for commercial purposes within the meaning of SIA, s.13(4). This last mentioned argument was abandoned on 16 December 2022 and on 24 February 2023 I made the ICO following a without notice hearing in accordance with CPR r.73.10A(3), on the basis that GDUK had established a realistically arguable case that SoL had given its consent to enforcement against its assets of any award made in a reference to arbitration pursuant to the arbitration agreement contained in clause 32 of the Contract. On 4 December 2023, SoL issued its discharge application, which it now advances exclusively on the basis of the immunity against execution conferred by of SIA, s.13(2)(b).
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