National Investment Bank v Eland: A Cautionary Tale

• Published date: 28 June 2022
• Subject Matter: Litigation, Mediation & Arbitration, Arbitration & Dispute Resolution
• Law Firm: Gatehouse Chambers
• Author: Mr Kort Egan

The recent case of National Investment Bank Ltd v Eland International (Thailand) Co Ltd and another addresses a wide range of matters related to arbitration in a relatively brief judgment. Foxton J considered, among other things, the relationship between sections 18 and 72 of the English Arbitration Act 1996 (AA 1996), waiver, section 14 of the AA 1996 and issue estoppel.

National Investment Bank Ltd (NIB) succeeded in its application under section 72 of the AA 1996 for a declaration that an arbitrator appointed by the court under section 18 of the AA 1996 did not have jurisdiction in respect of claims already advanced in court proceedings in Ghana. This blog will focus on the successful waiver argument raised by NIB.

Section 72(1) (saving for rights of person who takes no part in proceedings) provides:

(1) A person alleged to be a party to arbitral proceedings but who takes no part in the proceedings may question:
(a) whether there is a valid arbitration agreement,
(b) whether the tribunal is properly constituted, or
(c) what matters have been submitted to arbitration in accordance with the arbitration agreement,
by proceedings in the court for a declaration or injunction or other appropriate relief."

Facts

In 2001, NIB entered into a Collateral Management Agreement (2001 Agreement) with both the First Defendant (Eland Thailand) and the Second Defendant (Eland Ghana) (collectively "Eland").

In 2004, NIB and Eland entered into a further agreement (2004 Agreement). Clause 6 of the 2004 Agreement provided:

"All parties agree to resolve any differences in a friendly manner by discussions failing which the matter may be referred to an Arbitrator under the Laws of the United Kingdom in London"(Arbitration Agreement).

On 22 April 2014, Eland Thailand commenced proceedings against NIB in the Accra Court in Ghana, advancing various claims under the 2001 Contract (Accra Proceedings).

In May 2014, NIB served a defence and counterclaim in the Accra Proceedings and in December 2014, NIB served a Third Party Notice on Eland Ghana seeking to make it a party to the counterclaim advanced in the Accra Proceedings.

In June 2015, Eland Ghana filed an unconditional Notice of Entry of Appearance in the Accra Proceedings.

NIB subsequently made an application for permission to amend its counterclaim and Third Party Claim so as to advance additional claims. Eland Ghana filed an affidavit in opposition to that application. The application was refused.

On 15 December 2015...