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The Commercial Litigation Journal: January/February 2011
CMS

Ben Holland and Guy Pendell look at the judgment in Dallah and the tough line taken on the enforcement of New York Convention awards in England

The Supreme Court of the UK has now issued its first decision concerning the legal framework supporting international arbitration. The case under scrutiny, Dallah Real Estate and Tourism Holding Co v The Ministry of Religious Affairs, Government of Pakistan [2010] had created controversy amongst international arbitration users, even before the Supreme Court’s judgment was handed down. In Dallah, the Court of Appeal had upheld a first instance decision to refuse to enforce an ICC award made in France by a prominent three-member international arbitration tribunal composed of a former chief justice of Pakistan and a former English Law Lord. The Supreme Court unanimously upheld the judgment of the Court of Appeal. In doing so, it held that no arbitration agreement existed to which Pakistan was a party and that there were no other grounds for enforcing the award.

Julian Copeman and Heather Gething review the impact of the Prudential judgment

In a judgment handed down on 13 October 2010, the Court of Appeal confirmed that legal professional privilege (LPP) does not apply, at common law, to any professional other than a qualified lawyer, ie a solicitor or barrister, or an appropriately qualified foreign lawyer: R (on the application of Prudential plc & another) v Special Commissioner of Income Tax & another [2010] (Prudential). The court dismissed Prudential’s appeal against the High Court’s refusal to extend LPP to legal advice given by accountants on tax matters.

Dipti Hunter and Alexander Oldershaw examine the viability of the sophisticated investor defence

The Court of Appeal decision in Springwell Navigation Corporation v JP Morgan Chase Bank & ors [2010] has cast doubt as to whether, in the absence of fraud, an investor will ever succeed in a claim against a bank where there is a contractual non-reliance clause in the terms and conditions. Not only was the decision in this case supported by previous UK case law, but we can also see from the decisions in America relating to Terra Firma Investments (GP) 2 Ltd v Citigroup Inc [2010], and the recent investigation into Goldman Sachs activities on Wall Street, that there is an uphill struggle faced by sophisticated investors on both sides of the Atlantic.

Jonathan Arr explores recent decisions in the area of set-off

In his classic treatise on set-off, Rory Derham notes that this area of the law is curiously under-considered despite ‘the importance that the business community does attach to the right to set cross-demands against each other’ (The Law of Set-Off (3rd ed), page xxi).

Kennedys

Mike Wells and Donald McDonald consider recent cases on evidence and privilege

The principle of open evidence, that all the relevant material should be before a court to enable it to deal justly with the case in hand, is a strong feature of our justice system. A number of rules of evidence and disclosure, however, restrict the material a court may see. Some recent cases, especially concerning legal professional privilege, have clarified the boundary between what the court gets to see and what it does not.

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Tim Hardy investigates practical considerations in the light of the decision in Oceanbulk

The Supreme Court, in Oceanbulk Shipping & Trading SA v TMT Asia Ltd & ors [2010], has upheld yet another exception to the without prejudice rule holding that without prejudice negotiations, which form part of the factual matrix leading to a settlement agreement, will be admissible as evidence to assist in the interpretation of that settlement agreement. The reasoning of the court is impeccable but contradicts the long-established rule that without prejudice communications are not disclosable. This article considers the unintended consequences of the growing list of exceptions to the rule. It asks whether the logical conclusion is that lawyers about to commence without prejudice negotiations must begin by advising their clients of the circumstances in which those negotiations may be disclosable, and consider drafting an agreement to limit those circumstances where possible.

Bristows

Andrew Waters highlights the lessons to be learned from RBS v Hicks & Gillett

For a week in October 2010, the Royal Courts of Justice became the centre of attention for the sports press as a bitter struggle for control of one of the country’s great sporting institutions, Liverpool FC, was played out in a courtroom. The case centred on the efforts by Liverpool’s American owners, Tom Hicks and George Gillett (the owners), to retain control of the club despite steps being taken by the Royal Bank of Scotland (RBS) and the club’s board to force a sale of the club.