Bermuda Form: The Court of Appeal upholds an anti-suit injunction to prevent a challenge to an English Arbitration award in the US

In C v D [2007] EWCA Civ 1282, D insured C under a Bermuda Form policy that provided for London arbitration and was governed by New York Law. C commenced arbitration proceedings in London against D for unpaid monies and the Tribunal held that C was entitled to recover in full. D applied to the Tribunal asking it to correct its award, stating it was a “manifest disregard of New York law” and that it intended to apply to a US Federal Court to challenge the award. C sought an anti-suit injunction to prevent D from challenging the award in the US. At first instance, Mr Justice Cooke granted the anti-suit injunction and held that by agreeing to the seat, the parties agreed that any challenge to an award was to be made only in the courts of the place designated as the seat of arbitration. D appealed against Mr Justice Cooke’s decision on the basis that, as New York law was the governing law of the insurance policy, the defendant could not be deprived of exercising its right to a minimum standard of review of arbitration awards permitted under New York law. Although English law was the “curial law” of the arbitration, D argued that that did not exclude a challenge that reflected the parties’ express choice of New York law to govern their obligations under the policy. C argued that the judge was correct to decide that, once it was clear that England was the seat of the arbitration and that English law was the “curial law” of the arbitration, it followed that only remedies normally available under English law were available to D to challenge the Tribunal’s decision.

The Court of Appeal agreed with Mr Justice Cooke’s decision and upheld the anti-suit injunction. It held that by choosing London as the seat of the arbitration, the parties must be taken to have agreed that proceedings on the award should be only those permitted by English law. Lord Justice Longmore (who gave the leading judgment) stated that the whole purpose of the balance achieved by the Bermuda Form (English arbitration but applying New York law to issues arising under the policy) was that judicial remedies in respect of the award should only be those permitted by English law. This case reinforces the importance that English courts place on upholding the wording of arbitration clauses.