United Kingdom / 27 July 2011 / England and Wales, High Court / Dowans Holding S.A. v. Tanzania Electric Supply Co. Ltd / 2010 Folio 1539
| Country | United Kingdom |
| Court | England and Wales, High Court |
| Date | 27 July 2011 |
| Parties | Dowans Holding S.A. v. Tanzania Electric Supply Co. Ltd |
| Case number | 2010 Folio 1539 |
| Applicable NYC Provisions | V | V(1) | VI |
| Source |
[2011] EWHC 1957 (Comm) | online: BAILII |
| Languages | English |
| Summary | Dowans Holding S.A. and Dowans Tanzania (collectively, “Dowans”) entered into an electricity supply agreement with Tanzania Electric Supply Co. Ltd (“TANESCO”), a State-owned utility company (“the Agreement”). The Agreement provided for arbitration in Tanzania under Tanzanian law in accordance with the Rules of Arbitration of the International Chamber of Commerce. TANESCO purported to terminate the Agreement on the basis that it was void ab initio for contravening the Tanzanian Public Procurement Act 2004. Dowans commenced arbitral proceedings in Tanzania. The arbitral tribunal found that the Agreement was valid and rendered an award against TANESCO. TANESCO applied to have the award set aside in the Tanzanian courts. Meanwhile, Dowans obtained enforcement of the award in the English High Court pursuant to section 101(2) of the Arbitration Act 1996 (U.K.) (“the Act”) (providing for enforcement as a judgment or order of the court of an NYC award, as defined by the Act). TANESCO then applied to the Court to have the enforcement order set aside pursuant to section 103(2)(f) of the Act (incorporating Article V(1)(e) NYC regarding the refusal to recognise or enforce an award where the award is not yet binding, has been set aside or suspended by a competent authority of the country in which, or under the law of which, it was made). Alternatively, it sought to adjourn the issue of recognition or enforcement pending final determination of the Tanzanian proceedings pursuant to section 103(5) of the Act (incorporating Article VI NYC regarding adjournment of the decision on the recognition or enforcement of the award where an application for the setting aside or suspension of the award has been made to a competent authority of the country in which, or under the law of which, it was made). Dowans opposed the application and requested, in the event an adjournment was granted, partial recognition of the award and/or an order for security. The High Court granted TANESCO’s application for an adjournment. However, it also granted Dowan’s application for an order for security. First, the Court considered that the fact that there was a challenge to the award pending before the Tanzanian courts did not mean that the award was “not yet binding” within the meaning of that section. It noted that there was no definition of the word “binding” in the NYC or under the Act. It also referred to the NYC’s abolition of the requirement in the Geneva Convention on the Execution of Foreign Arbitral Awards of 1927 of double exequatur (i.e., the need, before an award could be enforced in another jurisdiction, that it first have been rendered enforceable in the country in which, or under the law of which, it was made). Second, the Court observed that even if the award has been set aside in the home jurisdiction, there was still discretion to set aside, enforce or adjourn the award both pursuant to section 103(2)(f) and Article V(1)(e) NYC. In the Court’s view, its discretion under section 103(2)(f) would inevitably be exercised in the same manner as the discretion to adjourn under section 103(5). Third, the Court found that TANESCO’s prospects of success in the proceedings before the Tanzanian courts were not fanciful and hence real, such as to justify an adjournment, but only coupled with an order for security. |
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Attachment (1)
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