Cross-border Disputes: English Court Of Appeal Rules That Service On A State Of An Order Permitting Enforcement Of An Arbitration Award Can Be Dispensed With In "exceptional Circumstances" Such As Civil Unrest

• Published date: 09 June 2020
• Author: Mr Daniel Hart, Kwadwo Sarkodie and Alain Farhad
• Subject Matter: Litigation, Mediation & Arbitration, Arbitration & Dispute Resolution, Trials & Appeals & Compensation
• Law Firm: Mayer Brown

States are afforded particular protections in English litigation. They not only have the benefit of various immunities (albeit subject to exceptions), but also other procedural privileges - including as regards the service of documents upon them.

Pursuant to Section 12(1) of the State Immunity Act 1978 ("SIA"), unless the State has agreed otherwise under Section 12(6), "Any writ or other document required to be served for instituting proceedings against a State shall be served by being transmitted through the Foreign and Commonwealth Office to the Ministry of Foreign Affairs of the State...".

In General Dynamics United Kingdom Ltd v Libya [2019] EWCA Civ 1110 however, the English Court of Appeal (overturning the decision at first instance) decided that service on a State of an order, obtained "without notice" and giving permission to enforce an arbitration award, could be dispensed with in "exceptional circumstances". The discretion to do so was exercised in this case in view of the civil unrest in Libya.

The Court of Appeal reached that conclusion on the following basis:

• Section 12 of the SIA did not contemplate that there will always be some document which is required to be served for the purpose of instituting proceedings and that such document (absent the State's agreement to the contrary) must be served through the Foreign and Commonwealth Office ("FCO").
• Indeed, if a foreign State had fully participated in (or deliberately declined to participate in) proceedings in litigation or arbitration, it did not obviously need the protection afforded by Section 12.
• An order giving permission to enforce an arbitration award did not therefore constitute a "writ or other document required to be served for instituting proceedings against a State" for the purposes of Section 12(1). It was therefore not mandatory to effect service of that document through the FCO on the relevant Ministry of Affairs as a consequence of Section 12(1).
• Pursuant to Rule 62.18(2) of the English Civil Procedure Rules ("CPR") the arbitration claim form did not have to be served unless the Court so ordered, which it had not in this case, and consequently neither Section 12(1) nor CPR 6.44 had any application to that document.
• Pursuant to CPR 62.18(8)(b) and 6.44 the order prima facie had to be served and any service of the order did have to be via the FCO. However, in the absence of a statutory obligation - in this case by reason of Section 12(1) of the SIA - to effect service of a...