UK: Dishonest But Not Disowned: Despite The High Court Finding One Party Guilty Of Fraudulent Conduct In An Arbitration, The Arbitral Award Was Allowed To Stand

Last Updated: 1 June 2012
Article by Simon Hems and Shawn Kirby

Chantiers de l'Atlantique SA v. Gaztransport et Technigaz SAS [2011] EWHC 3383

In this recent case, the Commercial Court held that despite Gaztransport et Technigaz SAS ("GTT") committing fraud in the underlying arbitration, the arbitral award should not be set aside as the fraud probably did not affect the result of the arbitration.

The background facts

The arbitration arose out of a licence agreement between Chantiers de l'Atlantique SA ("CAT") and GTT for the use by CAT of a new LNG containment system on LNG carriers being built by CAT. The arbitration was subject to French law and ICC Rules and heard in Paris. However, as the licence agreement provided for the place of arbitration to be London, the English courts retained supervisory jurisdiction.

Issues arose between the parties as to whether the cause of apparent defects in the first vessel constructed by CAT under the licence agreement was the workmanship of CAT or the design of GTT. Because of the terms of the licence agreement, CAT had to allege and prove "gross fault" as a matter of French law.

In an award dated 3 February 2009, the tribunal dismissed all of CAT's claims. Some were dismissed on the grounds that they were factually misconceived but, in respect of those where there was some factual foundation, they were denied on the ground that CAT could not establish "gross fault" as a matter of French law. In particular, the tribunal decided that even if CAT could establish the design fault or economic fault which it alleged, CAT could not satisfy the test imposed by French law as to the circumstances in which a licensor will be liable to a licensee for a design fault or an economic fault.

In considering the parties' allegations, the tribunal was presented with technical evidence by both parties, including analysis of tests conducted by GTT.

A few weeks after the issuance of the tribunal's award, CAT received a tip off from a whistleblower at GTT that CAT should look at the results of various tests carried out and that GAT had been the victim of a fraud. Then, in late 2010, another whistleblower provided CAT with a GTT internal email which referred to the results of tests carried out by GTT which had not been disclosed to CAT.

The Arbitration Act 1996 requires an application seeking leave to appeal an arbitration award to be made within 28 days of the award. However, in this case, CAT did not make such an application until six months after the award, during which time it had investigated the tip off from the first whistleblower at GTT. In the circumstances, the court found it entirely proper for CAT to take time to investigate the tip off before launching an application and granted CAT an extension of time to do so.

The essence of CAT's case was that the tribunal was misled by GTT and, in particular, by a Mr. M Chapot, who was employed by GTT and acted as a quasi-expert at the hearing and who CAT alleged gave deliberately misleading evidence to the tribunal.

The Commercial Court decision

In unusually strong language, the court held that Mr. Chapot's evidence "both before the Tribunal and before this court was dishonest". In particular, the court found that in his expert report and in oral evidence before the tribunal "he deliberately and dishonestly" concealed the existence of certain tests carried out and the results of those tests, as well as the nature of other tests, and that his evidence before the court "represented a masterclass in evasion and obfuscation and not the evidence of an honest witness".

However, to succeed in its appeal, CAT had to satisfy the court that the disclosure of the true position "would probably have affected the result of the arbitration". This it was not able to do, as the court found that if the true position had been known to the tribunal, it would not in all probability have made any difference to its decision. This was because the tests which were concealed or misrepresented were followed by further comprehensive tests which were disclosed and analysed by experts for both parties and also because the tribunal had decided that even if CAT could establish the design fault or economic fault which it alleged, CAT could not satisfy the test imposed by French law as to the circumstances in which a licensor will be liable to a licensee for a design fault or economic fault.


In refusing to set aside the tribunal's award, the court has reaffirmed the position that even where an innocent party can show some fraud by the other party to an arbitration, that will not automatically mean that the award shall be set aside. The fraud perpetrated by the other party must have some causal link with the tribunal's decision. If there is no causal link, then the fraudulent conduct is for all practical purposes irrelevant (although in some jurisdictions it might give rise to criminal prosecution).

This might seem unfair to many, as it might be argued that if the fraud had been uncovered during the course of the arbitration, the tribunal may have formed different views as to the strength of GTT's case and evidence. However, given the clear wording of the tribunal's award regarding the relevant French law test, the court was not willing to interfere with the overall result. If the tribunal's award had been dependent on the factual position, then the court may have been more willing to set aside the award.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.