West Tankers Inc v Allianz SpA (“The Front Comor”) [2012] EWCA Civ 27

A tanker owned by the Respondent, which was chartered to an Italian company, had caused extensive damage due to a collision with a pier owned by Charterers. The Appellants were Charterers’ insurers, and were subrogated to Charterers’ claims against Owners. A Tribunal had made an award declaring that Owners were under no liability to either Charterers or their insurers in respect of the collision.

Whilst the arbitration was pending, the insurers had brought proceedings against Owner sin the Italian courts. Owners applied for and obtained permission from the English court to enforce the arbitration award and to enter judgment in its terms under s.66 Arbitration Act 1006. The basis for this was that once the award had been entered as a judgment, any subsequent Italian judgment would not be recognised in England. The insurers appealed the English court’s decision.

The Court of Appeal dismissed the insurers’ appeal. It was held that the phrase “enforced in the same manner as a judgment to the same effect” in s.66 Arbitration Act 1009 was to be interpreted broadly, and was not limited to enforcement by one of the normal forms of execution of a judgment. Judges had the power to give force to an arbitral award by a number of means. In an appropriate case, the court could give leave for an arbitral award in declaratory form to be enforced in the same manner as might be achieved by an action on the award, and so give leave for judgment to be entered in the terms of the award.

As to what amounts to an “appropriate case”, this is something on which a judicial determination must be made on a case by case basis. Examples given in the judgment as to when a case would not be appropriate included where there is a serious question as to the validity of the arbitration award, or where the interests of justice do not favour the award being made (for example where the court considers it unnecessary). As such, the question of whether it is “appropriate” for such an order to be made will turn very much on the specific facts of each individual case.

This judgment is the latest in a series of court decisions arising out of disputes between West Tankers Inc and Allianz SpA, in relation to the vessel “THE FRONT COMOR”. The full text of this judgment and other decisions involving these parties are available on Bailii.