Groupe Chimiche Tunisien were dissatisfied with the quality of the sulphur supplied under the June and July contracts. The July contract was accordingly terminated and substantial claims and counterclaims under both contracts were initiated. It was agreed that the dispute under the June contract had to be resolved in London arbitration due to the clause stipulating as such within the contract. Midgulf similarly wished the dispute under the July contract to be resolved in London arbitration. However, Group Chimiche Tunisien countered this, stating that the July contract contained no clause for London arbitration and therefore the dispute could be resolved in the courts of Tunisia.
Midgulf submitted that the parties had contracted in July on the basis of Midgulf’s offer, which stated that jurisdiction and arbitration were to be in accordance with the June contract which provided for English law and London arbitration, which was accepted orally. An alternate approach adopted by Midgulf was that a fax sent by Groupe Chimiche Tunisien was a counter-offer and containing the June contract terms which was accepted by Midgulf. As such Midgulf applied for the appointment of an arbitrator and an anti-suit injunction, preventing Groupe Chimiche Tunisien from taking proceedings to Tunisia.
The High Court refused Midgulf’s application on both grounds.
Firstly it was held that the July contract confirmed the oral agreement of 150,000 mt of sulphur at $895 per ton only. The Court stated that such an agreement could be enforceable as an agreement solely on main terms, hence, it was not reasonable to conclude that confirming the amount and cost was confirming each of the details in the June contract, including London arbitration.
The second argument made by Midgulf was of the counter-offer in the form of a fax. However, the Court found that, though the fax was a counter-offer, it was not an acceptance of all the terms of Midgulf’s offer. It was not reasonable to construe the fax of Group Chimiche Tunisien as an acceptance of Midgulf’s detailed terms of the June contract. The Court concluded by stating that Group Chimiche Tunisien’s counter-offer was accepted by Midgulf on terms that did not include a London arbitration clause. Accordingly, Midgulf’s application to appoint an arbitrator and continue the anti-suit injunction was dismissed.
A reminder, once again, from the English Court that parties must be clear about the terms on which they are contracting.