Knowles: Awards should not have come into existence
The potential consequences for two lawyers the High Court has referred to their regulators are not reasons to grant leave for an appeal, the judge has ruled after setting aside a $11bn arbitration award against the Republic of Nigeria.
The high value and the involvement of a nation state also did not justify an appeal, after Mr Justice Robin Knowles ruled in October that the award was “obtained by fraud”.
In that decision, he referred Seamus Andrew, managing partner of London firm Veltior, and Trevor Burke KC to their regulators for “indefensible” conduct in using allowing their client to use privileged documents. He said they were financially motivated.
Both men have rejected the criticism of the way they handled Nigeria’s internal legal documents and said they expected to be cleared by their regulators.
One of the ‘other compelling reasons’ for the appeal put forward by Process & Industrial Developments Ltd (P&ID), the British Virgin Islands company which won the arbitration award, were “the potential consequences of the judgment for Mr Burke KC and Mr Andrew, and the possible implications for any regulatory proceedings of any conclusions reached by the Court of Appeal as to whether or not their conduct was causative of the awards”.
In denying permission to appeal on this and all the other grounds just before Christmas, the judge stated simply that “regulatory proceedings are a separate matter”.
More generally, Robin Knowles J acknowledged that it was “a major thing for a challenge under section 68(2)(g) of the Arbitration Act to succeed and for arbitration awards to be set aside”.
He continued: “I am acutely conscious of the responsibility placed on this court to decide whether to grant or refuse the leave required for any appeal. I approach the question of leave to appeal with respect for the huge significance of this matter to both parties.”
But the size of the award was “not a reason in itself for an appeal” and “the fact that a state is a party is important, but that too is not a reason in itself for an appeal”. He said P&ID “had a fair trial and it has lost”.
Robin Knowles J concluded: “The grant of leave to appeal has consequences, just as its refusal does. The grant of leave to appeal would not be just in all the circumstances.”
On the question of setting aside the awards or remitting them to the tribunal for reconsideration, he said: “There is, in my judgment, no real prospect of justice being done by the tribunal upon reconsideration. That is not, in this case, because of the behaviour of the tribunal. It is because of the behaviour of P&ID…
“It is clear now that the awards should not have come into existence. They should be removed now.”
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