The Court of Appeal has partly upheld the injunction granted by the Commercial Court restraining the pursuit of arbitration proceedings seated in Lebanon: Sabbagh v Khoury and others  EWCA Civ 1219.
In doing so, it confirmed the power of English courts to restrain a foreign arbitration on grounds that the foreign arbitration is oppressive and vexatious and provided helpful guidance on the exceptional circumstances in which English courts may exercise this power. In particular:
- English courts have the power to grant such an anti-arbitration injunction where it is just and convenient to do so.
- Where it is clear that the dispute is within the scope of the arbitration agreement, no injunction should be granted.
- Where it is clear that the dispute is outside the scope of the arbitration agreement, either because it is common ground between the parties or because of a previous determination, the court may grant an anti-arbitration injunction but only if the circumstances of the case require it (eg when the proceedings are considered oppressive and vexatious).
- It is not a precondition to the grant of such an injunction that England be the "natural forum" for the underlying dispute.
- Save in the case of exclusive jurisdiction agreements, the grant of an anti-arbitration injunction remains an exceptional step.
For further information, please see this post on our Arbitration Notes blog.
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