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Wadi Sudr Notes

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WADI SUDR FACTS Whether a judgment of a fellow member state of the European Union ruling against a stay of proceedings on the basis that an arbitration clause was not incorporated in the contract can be relied on as creating an issue estoppel so as to prevent the English court deciding the point differently. The broad picture is as follows. The appellant, Endesa, commenced proceedings in the Mercantile Court of Almeria in Spain in order to arrest a vessel and claim damages for late delivery under a bill of lading for discharging a cargo of coal at a port some way short of the contractual point of discharge. The respondents, NNC, commenced proceedings in the Commercial Court in London without reference to any arbitration clause claiming a declaration of non-liability. NNC however sought a stay from the Almeria court on the grounds that there was an arbitration clause incorporated by reference to a charterparty in the bill of lading, alternatively on the grounds that the Commercial Court in London was first seised. The Almeria court ruled (so Endesa alleges) that no arbitration clause was incorporated into the contract, refused to decline jurisdiction on that basis, but stayed proceedings pending the Commercial Court in London establishing its position as the court first seised. NNC commenced an arbitration and also arbitration proceedings in London (the arbitration proceedings). Endesa's response was to assert that the judgment of the Almeria court was binding on the English court under article 33 of Council Regulation (EC) No 44/2001 (the Regulation) so as to preclude the English court from deciding that question a different way. QUESTION Whether the judgment of the Almeria court is a judgment to which the Regulation applies and whether it gives rise to an issue estoppel in the Commercial Court in London in the arbitration proceedings. HOLDING Do the Spanish Proceedings fall within the Regulation?
NNC accept that the proceedings brought in the Almeria court claiming damages for breach of the bill of lading would come within the Regulation. The question is whether a judgment which is not on the merits but which is ruling that an arbitration clause has not been incorporated and that proceedings should not be declined for that reason is a judgment which

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