Abuse Of Process Issue Estoppel Applies Equally Within The Same Arbitral Proceedings. No Second Bites! - Simon Rainey QC

• Published date: 02 September 2020
• Law Firm: Quadrant Chambers
• Author: Mr Simon Rainey QC

OVERVIEW

Daewoo Shipbuilding & Marine Engineering v Songa Offshore Equinox Ltd [2020]

A claimant seeks a preliminary issue on a question of construction. It states that it accepts that if the point is decided against it, then that will be the end of all claims by it in respect of the project in question. The other party on this basis agrees and the tribunal makes a consent order. The claimant loses the preliminary issue and leaves it too late for a s.69 appeal.

Can it then amend to run a different legal case on more or less exactly the same facts complained of, which it could have run in the alternative to its primary case, if wrong on its primary case on construction?

Can it resist reliance on res judicata on the basis that that principle cannot apply to amendments in the same set of proceedings as those in which the preliminary issue decision was made?

Or can the other party preclude the claimant from re-opening any claim on those matters, and, in addition, to defending its counterclaim by seeking to rely on the matters as defences?

Indeed can the other party contend that a binding agreement came into effect concerning the preliminary issue which meant that the claimant had contracted out of its rights (if any) to make any other claims if it lost on the issue?

These stark facts arose in Daewoo Shipbuilding & Marine Engineering (DSME) v Songa Offshore Equinox Ltd [2020] EWHC (TCC). The Court (Jefford J.), dismissing DSME's double-barrelled s. 69 and s.68 Arbitration Act 1996 applications, held that DSME was estopped per rem judicatam from trying to relitigate matters which it could and should have raised before, that it made no difference that this all took place in the same set of proceedings rather than in two separate sets of proceedings and that this preclusion extended to relying on the same matters not only as claims in their own right but...