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||Neutral Citation Number:  EWHC 3009 (Comm)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
BUSINESS AND PROPERTY COURT
OF ENGLAND & WALES
London EC4A 1NL
||25 September 2018
B e f o r e :
THE HONOURABLE MR JUSTICE BRYAN
||QINGDAO HUIQUAN SHIPPING COMPANY
||- and -
||SHANGHAI DONG HE XIN INDUSTRY GROUP CO LTD
MR P. RICHES and MR A. FELD (instructed by Holman Fenwick Willan) appeared on behalf of the Claimant/Applicant.
THE DEFENDANT/RESPONDENT did not attend and was not represented
HTML VERSION OF JUDGMENT
Crown Copyright ©
MR JUSTICE BRYAN:
- This is an application by Qingdao Huiquan Shipping Company ("Owners") for an interim anti-suit injunction restraining the Defendant, SDHX, from continuing proceedings against Owners before the Courts of the People's Republic of China (the "Qingdao Proceedings"). In support of that application I have before me a witness statement of Mr Zhang Zhou of 31 July 2018 and a witness statement of Nicholas Poynder of 31 July 2018 and associated exhibits in relation to that which I have considered, and which I have been taken through during the course of this hearing.
- The background to this application is that by a settlement agreement dated 22 January 2014 (the "Settlement Agreement") Owners and a third party, which Owners say is related to SDHX, namely Emori (China) Company Limited ("Emori"), agreed to settle certain disputes between them arising in relation to the delivery of a cargo of nickel ore to China. That Settlement Agreement was governed by English law and contained a London arbitration clause.
- Turning to the background in a little more detail, by a trip time charter on 9 October 2013 (the "Charter") the Owners chartered the M/V Confidence Ocean (the "Vessel") to Safe Arrival Maritime Limited ("Charterers") for the carriage of a cargo of nickel ore in bulk from Indonesia to China. Bills of lading dated 10 December 2013 were issued in respect of 45,000-odd wet metric tonnes of nickel ore in bulk (the "Cargo") loaded at Pomalaa, South East Sulawesi, Indonesia for discharge at "Main Port of China Mainland." In the event, the receiver was the company I have just referred to, Emori (China) Co. Limited, who became the lawful bill of lading holders. The Charterers were in default in paying the hire under the Charter and on 20 January 2014 the Owners served on the Receivers a notice of lien over the Cargo and any other sub-freights which were owing or may become owing by the Receivers to the Charterers up to the amount equivalent to the outstanding sum due to the Owners under the time charter up to the amount of US$648,605.61.
The Settlement Agreement
- That led to a written agreement being entered into between the Owners and the Receivers on 22 January 2014 (the "Settlement Agreement"). Mr Li Guolin, who was the Receivers' lawyer at the time, signed that Settlement Agreement on behalf of the Receivers pursuant to an original power of attorney dated 18 January 2014. That Settlement Agreement was executed in Chinese and in English versions but in the English version the date of the agreement was wrongly entered at 22 January 2013 but it is clear from the Chinese version that the correct date was 22 January 2014. The English name of SDHX was also misspelt in that document but, as is said by Mr Zhou in his statement, those errors do not appear in the Chinese version and it appears that those errors crept in during the process of translation and Mr Zhou confirms that they do not reflect the agreement of the Owners and the Receivers.
- It is necessary to set out some of the terms of that Settlement Agreement in detail because they are of relevance to the events that subsequently occurred. The Settlement Agreement included the following clauses:
"The Receiver agrees to pay the Owners a lumpsum of US$640,000 to the Owners' nominated bank account detailed below (or equivalent RMB 3,910,848 @ exchange rate of 6.1107 to Owners' nominated RMB bank account detailed below) by 23 January 2014 in full and final settlement of (a) the Owners' claim for the outstanding hire up to 0630 GMT 25 January 2014 due to them under the Time Charter; and (b) the Owners' claim for the port fees and agency fees in relation to the Vessel's berthing alongside Lianyungang. Such payment will be made by the Receiver's authorised agent [SDHX]...
6. The Owners shall bring legal proceedings against the Charterers for breach of the Time Charter. In case the Owners succeed in recovery of the outstanding hire from the Charterers up to the earlier date of (a) the actual completion of discharging of the Cargo, or (b) 2400 hours 30 January 2014 and succeed in recovery of the fees for cleaning the bottom fouling from the Charterers, the Owners shall repay the Receiver the recovered sum provided that such sum shall not exceed … the amount received from the Receiver save that the Owners shall be entitled to obtain any recovery from the Charterers in relation to the Charterers' failure to [do certain matters] on redelivery in accordance with the terms of the time Charterer...
9. This Agreement shall be governed by and in accordance with English law. Any dispute of claim (whether contractual or otherwise) arising under, out of or in connection with this Agreement shall be submitted to London Arbitration."
- Therefore, the Settlement Agreement contained an arbitration agreement between the parties thereto whereby any dispute arising under, out of or in connection with this agreement i.e. the Settlement Agreement, and whether contractual or otherwise, was to be submitted to London arbitration.
- By clause 2, the Owners and Receivers agreed that the Receivers would procure payment to the Owners by SDHX as the Receivers' "authorised agent", but SDHX itself was not a party to the Settlement Agreement.
- The evidence before me is that on 23 January 2014 SDHX did indeed transfer RMB 3,910,848 into the Owners' account and the Cargo was subsequently released to the Receivers in accordance with the Settlement Agreement. As I have already said, the Settlement Agreement was signed by Mr Li Guolin under a power of attorney and the version of that Settlement Agreement which bears the stamp of the claimant also bears his signature, for and on behalf Emori (China) Co. Limited.
- However, matters do not stop there because on 27 January 2014 that agreement in both the English and Chinese versions was further signed and stamped by the Receivers and was emailed to the Owners by Emori on this occasion containing the stamp of Emori but otherwise being in identical terms, and that is of potential relevance in the light of the fact that, as will appear, SDHX now says that it had a separate oral agreement with the Owners and that it was under that agreement that it made the payment to the Owners on 23 January 2014. I should say that the Owners strongly dispute there was any such agreement, oral or otherwise, with SDHX itself, and their evidence is that the Settlement Agreement between the Owners and the Receivers was the only document recording the rights and obligations of each of the parties. That, then, was the events back in 2014.
- Over three years later, proceedings were to be commenced in China by SDHX. However, in the meantime, Owners commenced proceedings against Charterers in accordance with their obligation to do so under clause 6 of the Settlement Agreement in arrest proceedings in South Korea. The evidence before me is that they were unable to recover the sums due to them.
The Qingdao Proceedings
- In April 2017, over three years after the Settlement Agreement, SDHX commenced proceedings in the Qingdao Shinan District Court seeking repayment of the sum it had transferred to the Owners under the Settlement Agreement, although, in fact, it was not until later, in July 2017, that Owners were formally served with those proceedings.
- In those proceedings there was a statement of claim issued by SDHX. There are a number of significant features of that pleading. The first one is that SDHX do not dispute that they paid $640,000 to the Claimant. Secondly, it is not disputed by SDHX in that document the Settlement Agreement provided for Emori to pay that sum. Thirdly, it is not disputed that SDHX was not a party to that agreement and, in addition, in that pleading it is asserted that there is an alleged oral agreement between SDHX and the Defendant. The precise basis of the claim is not entirely clear from the facts and grounds, but in relevant respects it provides as follows:
"Such payment will be made by the Receiver's authorised agent, Shanghai Dong He Xin..."
It then continues as follows, "Having objection to the arbitration clause," i.e. clause 9 under the agreement (and that clause is then quoted):
"... and nature of payment of fund, the plaintiff did not sign the agreement. However, both parties reached a new oral agreement whereby the defendant promised and warranted to take legal actions against the Charterers for their breach of the trip time charter and the hire and relevant costs recovered from Safe Arrival Maritime Limited (the Charterers) hereinafter 'SAML' will be refunded and compensated to the plaintiff for their advanced amount. In addition, the buyer has by letter of credit made full credit for the nickel ore cargo under the sale contract [reference given]... and for the freight within three working days upon signing of the sale contract and the above written agreement has been varied. As such the plaintiff advanced to the defendant the aforementioned fund... so as to settle the dispute.
Furthermore, considering that the defendant promised and warranted to take legal actions and other relief to return the plaintiff's advanced fund, the plaintiff in light of the intentions of the parties expressly remarked in the bank payment slip on 23 January 2014 the usage of the payment to be, 'Advance freight, demurrage and etc,' which means the fund was not the charterers' outstanding hire under the written agreement. Whilst the plaintiff only reached the oral agreement with the defendant, the plaintiff still actually advanced the freight and demurrage of RMB 3,910,848 with good faith and, further, both parties had no objection to this. As such, in light of the defendant's breach the plaintiff is entitled to claim against the defendant for the refund of the advanced fund and request the defendant to compensate for the loss."
- So it will be seen that there is an allegation of a new oral agreement which, if it existed, would have had to have happen very quickly given that the payment was made by SDHX almost immediately after the Settlement Agreement was entered into, and there is also an allegation that the written agreement has been varied so there appears to be reliance within the course of that claim, upon the Settlement Agreement itself, and it is said that there is breach of the agreement. There is an allegation within that statement of claim that the claimant cheated Emori and SDHX and the claim itself on the final page of that statement of claim provides that the defendant's fault and breach of promise has constituted, "The breach of contract and damaged the claimant's property rights and the defendant shall take civil liability."
- It is clear that the claim being advanced by SDHX in those Chinese proceedings is one for breach of contract, and it appears to be alleged not only that there is an oral agreement which is strongly denied by the claimant in these proceedings, but also express reliance is placed on the Settlement Agreement which, of course, is an agreement between the claimant and Emori. The consequence of SDHX's arguments at least in relation to the oral agreement is that because its claim arises under an oral agreement SDHX is (so it says) not bound by the arbitration agreement in the Settlement Agreement.
- Owners objected to the jurisdiction of the Qingdao Shinan District Court to hear SDHX's claim. Owners' position was that:
(1) The claim was a maritime dispute, and therefore the Shinan District Court had no jurisdiction to hear it and the claim had to be heard by the Qingdao Maritime Court; and
(2) In reliance on the arbitration agreement in the Settlement Agreement, SDHX's claim was one that had to be brought in London arbitration.
- Owners set out a reservation as regards jurisdiction stating that any reference to Chinese law or substantive issues should in no event be deemed to be an acceptance of the jurisdiction of the Chinese Court, the application of Chinese law, the admission of liability or a waiver of any right by Owners. Owners relied upon the arbitration clause and denied that the Qingdao Shinan District Court had jurisdiction, stating that the arbitration clause bound both Emori and SDHX as authorised agent which relied on the Settlement Agreement in its claim.
- In a ruling dated 5 December 2017 the Qingdao Shinan District Court determined that SDHX paid the payment to Owners on behalf of Emori under the Settlement Agreement, that the dispute constituted a maritime dispute and that the matter should be transferred to the Qingdao Maritime Court to decide on the validity of the London arbitration clause. Accordingly, the Qingdao Shinan District Court declined to decide the jurisdiction issue of whether SDHX was bound by the arbitration agreement, instead holding that the claim on its own terms had not been brought in the correct Chinese Court.
- In January 2018 SDHX appealed that ruling to the Qingdao Intermediate People's Court and Owners asked for that appeal to be dismissed, again reserving their rights as to jurisdiction. That court delivered its judgment to the parties on 15 June 2018 when the Qingdao Intermediate People's Court upheld the first instance decision in Owners' favour and dismissed the appeal. In the course of its judgment it said as follows:
"It is found by this Court that, one of the foundations for the Appellants' recovery claim before the first instance court was the [Settlement Agreement] signed between [Owners] and Emori... The Appellant in reliance upon this Agreement to prove that [sic]: the Defendant was obliged, on the premise of the true transaction, to take legal actions against Charterers... for their breach of contract, so as to recover the outstanding hire, which shall be refunded to [SDHX] for the costs they paid...
The above facts to be proved are relevant to whether the claims of [SDHX] in this case can establish or not...
To summarize, the Civil Ruling of the first instance court is correct and shall be affirmed." (emphasis added)
- It is also relevant to note that the Qingdao Intermediate People's Court ruling was stated to be final. Accordingly, Owners say, before me today, that that ruling makes clear that SDHX's claim was in fact premised upon the Settlement Agreement and will no doubt say in due course in those Chinese proceedings, if they proceed, that SDHX is bound by that finding. It is of relevance to note that, as at first instance, the appellate court did not consider the jurisdictional issue of whether SDHX was bound by the arbitration agreement, dealing only with the proper allocation between the respective courts.
- As yet, and I have evidence before me that this is normal, the matter has not yet been transferred to the Qingdao Maritime Court, but when it is that court would consider the validity of the arbitration clause. Until then the substantive claim of SDHX in those proceedings is stayed.
- It will be seen that, in fact, Owners who appear before me today, have been aware since the middle part of 2017 about the attempt by SDHX to bring proceedings in China which are said to be in breach of the arbitration clause in the Settlement Agreement. However, at that stage no claim for interim relief in the form of an anti-suit injunction was sought.
- In terms of events in this jurisdiction, it was only on 1 August that a Part 8 arbitration claim form was issued against the defendant. That led to a paper application on 3 August when Robin Knowles J made an order (the "Service Out Order"):
(a) granting permission to serve the following documents out of the jurisdiction and by alternative means on SDHX's legal representative, Li Dong and PRC lawyer, Li Guolin: the claim form; the application for an interim anti-suit injunction; the "ASI application"; the evidence in support thereof; and any other document in these proceedings;
(b) providing that SDHX had twenty-four days from service of the claim form within which to serve an acknowledgement of service and any written evidence in response; and
(c) noting that as the order was made without notice SDHX had a right to apply to set it aside or vary it under CPR rule 23.1(1).
- There is evidence before me of the steps that were then taken to serve the Service Out Order pursuant to the aforesaid order of Robert Knowles J. Specifically, (a) on 7 August 2018 the claim form and the ASI application were served on Li Guolin at a specified email address and pursuant to para.2 of the Service Out Order the deemed date of service by that method was 7 August 2018; (b) the claim form and the ASI application were sent to Li Dong by registered post at SDHX's registered and business addresses. Documents were delivered and signed for at those addresses on 8 August and pursuant to para.2 of the Service Out Order the deemed date of service by this method was 9 August 2018.
- The evidence before me is that the Claimant's solicitors notified SDHX by email on 23 August to SDHX's PRC lawyer, Li Guolin, that the court had invited the parties to attend to list the ASI application on 24 August. The evidence before me is that no representative of SDHX attended the listing appointment. In addition, Mr Philip Riches who appears on behalf of the claimant today, together with Andrew Feld of counsel, also provided evidence in relation to the fact that the respondent was notified of the fixture of the hearing today and, indeed, yesterday was notified of the court hearing and was supplied with a copy of the Claimant's skeleton argument. Nevertheless, there has been neither any written representations, nor has there been any appearance before me today on behalf of the respondent on this interim anti-suit injunction.
The nature of the obligations of the claimant on this application
- It will be apparent that this hearing before me today is on notice and, indeed, is the result of a fixture which was fixed on notice to the respondent. In those circumstances, this is not a without notice hearing and there is no duty of full and frank disclosure upon the claimant. However, this is a situation in which the respondent has not appeared which raises the question about what the nature of the obligations are that are upon the claimant. In that regard I have been referred to a decision of Cresswell J, Braspetro Oil Services Co & Anor v FPSO Construction Inc  EWHC 1359 and also a decision of HHJ Waksman QC (as he then was) in CMOC Sales & Marketing Ltd v Person Unknown & Ors  EWHC 2230 (Comm).
- From those cases it is established that the obligation upon the claimant in a case such as this is an obligation to present the case fairly and identify points which might be to the benefit of the defendant. In addition, there is an obligation to address points not taken to date by that defendant that might had been taken by that defendant had they appeared before the court. I am satisfied that Mr Riches, who appears on behalf of the claimant, has borne those obligations well in mind, and in extensive oral submissions has taken me to the relevant material in the bundle and identified any points which might be regarded as points which went to the position of the Defendant.
The Angelic Grace
- These principles are well established in the normal situation between two parties to an arbitration agreement i.e. an A and B situation. The courts will ordinarily restrain proceedings commenced abroad in breach of a London arbitration agreement unless there is "a good reason" or "strong reason" not to do so, see the Angelic Grace  1 Lloyd's Rep. 87 at 96 RHC per Millet LJ; Donahue v Armco  1 Lloyd's Rep 425 at - per Lord Bingham. It is for the party resisting the grant of such an injunction to prove that there are such good or strong reasons, see Donahue supra at paragraph 24. At the interim stage it is necessary for the injunction claimant to show there is a "high degree of probability" that its case is right i.e. that there is an exclusive jurisdiction clause and that it has been breached - see Transfield Shipping v Chiping Xingfa  EWHC 3629 (QB) per Christopher Clarke J at -.
- However, one relevant consideration in relation to the seeking of such relief is whether or not the injunction claimant has acted promptly. This is a feature which I will need to return to in due course given the passage of time between when the Chinese proceedings were first commenced and when the current claim for relief under Part 8 was made. The applicable principles are that an injunction claimant must act, "Promptly and before the final proceedings are too far advanced," see the Angelic Grace, supra at 96 RHC.
- Furthermore, in relation to this:
(1) There is no rule as to what will constitute excessive delay in absolute terms. The court will need to assess all the facts of the particular case, see The Kishore  1 Lloyd's Rep 427 at - per Walker J.
(2) The question of delay and the question of comity are linked. The touchstone is likely to be the extent to which delay in applying for anti-suit relief has materially increased the perceived interference with the process of the foreign court or led to a waste of its time or resources - see Ecobank Transnational v Tanoh  1 Lloyd's Rep 360 (CA) at - per Christopher Clarke LJ; The Kishore at ; and see also Sea Powerful II v Bank of China  1 HKC 153 at  per Kwan JA.
(3) When considering whether there has been unacceptable delay a relevant consideration is the time at which the applicant's legal rights had become sufficiently clear to justify applying for anti-suit relief - see, for example, Sana Sabbagh v Khoury  EWHC 1330 (Comm) at - per Robin Knowles J.
Extension of Angelic Grace principles in the absence of privity of contract
- It will be noted that, in the present case, the claim for an interim injunction is not against the original party to the Settlement Agreement and therefore to the arbitration agreement i.e. Emori, i.e. this is not an A and B situation. The claim for an injunction is brought against SDHX which is, in that sense, at least to the original Settlement Agreement, a third party. However, the case law establishes that in appropriate cases it is possible to obtain an anti-suit injunction against a party which is not party to the contract itself.
- In this regard a claimant abroad will be restrained by injunction from suing inconsistently with a forum clause contained in the contract which forms the basis of the claim. That is so even where the defendant himself denies that there is privity of contract and therefore denies that the foreign claimant is bound by the contract containing the Forum clause. In essence, he is not entitled to found a claim on rights arising out of a contract without also being bound by the forum provisions of that contract, see The Yusuf Cepnioglu  1 Lloyd's Rep 641 (CA) at - and  per Longmore LJ and - and - per Moore-Bick LJ; Dell v IB Maroc.com  EWHC 2397 (Comm) at -, - and - per Teare J; Sea Premium v Sea Consortium (unrep, 11 April 2011) at pp.22-23 per David Steel J; The MD Gemini  2 Lloyd's Rep 672 at  per Popplewell J; and Fair Wind Navigation v ACE Seguradora  EWHC 352 (Comm) at - per Robin Knowles J.
- Of those cases, the most relevant and apposite to the present application is that of the Yusuf Cepnioglu, although that case is not on all fours because it might be said by SDHX that there is the additional feature in the present case that there is an alleged oral agreement separate from the settlement agreement. In riposte to that, it is said on behalf of Owners that there is a high degree of probability that, in fact, there is an arbitration agreement and that the making of the claim that is brought in essence reflects the Settlement Agreement or the essential content of the right as asserted is that of the right under the Settlement Agreement and that therefore, in similar terms to the case of the Yusuf Cepnioglu, the Defendant, SDHX, should be restrained from continuing with the Chinese proceedings.
- As is clear from the relevant authorities it is necessary to characterise the substance of the claim being asserted by the foreign claimant. The question is whether the claimant is, in substance, asserting a contractual liability, see in particular the Yusuf Cepnioglu at - and -; Dell v IB Maroc.com at  and ; Sea Premium at  and the Fair Wind Navigation case at .
- Guidance on the proper approach to characterising the foreign claim was set out by the Court of Appeal in The Prestige  2 Lloyd's Rep 33 at - per Moore-Bick LJ. In particular:
(1) The key question is the substance or content of the right asserted abroad, not the derivation or formal source of the right: see at ; and
(2) when determining the substance or content of the foreign right, it is necessary to look at the questions or issues raised, rather than the form of the claim, see at .
- Where the foreign claimant is indeed bringing a contractual claim inconsistently with a jurisdiction clause in that contract an injunction will be granted on Angelic Grace principles notwithstanding that the injunction is not strictly contractual, see Dell v IB Maroc.com at  and the Yusuf Cepnioglu at  and . In such cases where the right is contractual that is being relied upon it is not necessary for the injunction claimant to show that England is the natural forum.
The application of the applicable principles to the facts of this case
- I am satisfied that the principle identified in the Yusuf Cepnioglu and Dell v IB Maroc.com applies to SDHX's claim, and that there are not any strong reasons not to grant the injunction, subject to a consideration of the question of delay (as addressed in due course below). I have had regard to the evidence in Mr Zhou's statement at paragraphs.18-21, 28-29 and 39-41 as well as the submissions advanced in the written skeleton argument of the claimant and the oral submissions of Mr Riches developing the points made on the claimants' behalf. I have had particular regard to the fact that it is clear from the Settlement Agreement that SDHX is indeed seeking to rely upon the terms of the Settlement Agreement in advancing its claims in the Chinese proceedings and that, in doing so, therefore, it has to take the burden of the arbitration clause, if an arbitration clause be a burden, in clause 9 as well as the benefits that it seeks to derive from that agreement. It is clear from a consideration of the statement of claim itself, that SDHX is, indeed, seeking to claim under that agreement. The statement of claim expressly refers to the fact that the written agreement has been varied and that SDHX's claim is one for breach of contract.
- I recognise that there is an allegation that the parties also reached a new oral agreement. It is not necessary for me to determine that allegation for the purpose of the claim for interim relief that is before me today, but I would make the following points. First, there is no evidence before me supporting the existence of any such oral agreement. If there were to be any such oral agreement it would have to have been entered into very quickly and before the time when SDHX made the payment. There is no evidence of that. Secondly, the claimant went to the trouble of entering into a detailed Settlement Agreement with Emori, including an arbitration clause. It would be surprising if almost immediately after entering into such agreement it entered into an oral agreement with the agent paying the sum on behalf of Emori, SDHX, or that it would have done so without ensuring that it had the same arbitration rights which it had just secured under the Settlement Agreement.
- It is also right to say that there has been no response by SDHX to the Part 8 proceedings and, in that regard, there has been no foreshadowing of any defence or any evidence supporting the existence of an oral agreement. In addition, of course, there are the findings of the Qingdao Intermediate People's Court that one of the foundations for the appellant's recovery claim before the First Instance Court was the Settlement Agreement itself and that the appellant in reliance upon that agreement was relying upon the defendant being obliged on the premise of a binding agreement to take legal action against the charterers. I am also satisfied, on the material before me today, that the claimant did indeed seek to take proceedings against the Charterers involving an arrest but, in the event, was unsuccessful in doing so.
- I consider that, in all the circumstances, the substance of the claim that is set out in the statement of claim is one which has a foundation in the Settlement Agreement, and SDHX is seeking to rely upon the Settlement Agreement. In doing so it is also obliged to take the burden of that agreement as well. I am satisfied that the claim being advanced by SDHX for the purpose of this interim relief falls squarely within the principles that I have identified in terms of the extension to the Angelic Grace principles, in particular as identified in The Yusuf Cepnioglu. In those circumstances, I am satisfied, subject to the question of delay, that this is an appropriate case for the granting of interim relief in circumstances where I am satisfied that there is a high degree of probability that the claimant's case is right based on the arbitration agreement in the Settlement Agreement.
- It would be for SDHX to show that there has been such excessive delay on the part of the Owners that the Court should not exercise its discretion to grant an injunction. There is no doubt that some time has passed, to put it neutrally, between the Qingdao Proceedings being served on the Owners in July 2017 and the issuing of this application for anti-suit relief on 1 August 2018, a period of just over one year. It could be argued that the Owners should have come to this Court as soon as they were aware of those proceedings and sought injunctive relief. That was not done.
- Against that, I consider that this is not a case where the foreign court has considered the question of jurisdiction i.e. whether the arbitration clause binds SDHX, let alone considered the substantive merits of the case. As will be apparent from identification of the Chinese Court proceedings to date, those proceedings have only considered the issue of whether SDHX's claim should have been brought, and the jurisdiction issue decided, in the Qingdao Shinan District Court or the Qingdao Maritime Court. That was a jurisdictional question internal to the Chinese Court system. It is not about the issue, live in the instant proceedings, as to whether the arbitration clause binds SDHX. In those circumstances, there are not those comity concerns which may arise in other cases. This is not a case where the English Court is being asked to second guess a decision of the Chinese Courts.
- It is also said by Mr Riches, on behalf of the claimant, that there has been some benefit in obtaining the judgment of the Qingdao Intermediate People's Court. It is said that that judgment was only handed down on 15 June this year and that that ruling clarified that SDHX's claim was indeed based on the Settlement Agreement, and that clarification was given in relation to Owners' legal rights in that regard because of the fact that that court made clear that SDHX was indeed relying upon the Settlement Agreement as part of its claim and that, in those circumstances, it is said that Owners cannot be criticised for waiting for such clarity before issuing an application which of course requires Owners to establish their case to a high standard, that is a high standard of probability, and is itself, of course, an intrusive and expensive form of relief. Reference is made in that regard to what was said in the case of Sabbagh v Khoury supra by Robin Knowles J, at -:
"33 Delay by an applicant is an important consideration in this area of the court's jurisdiction: see the discussion of delay in Ecobank Transnational Incorporated v Tanoh  EWCA Civ 1309;  1 Lloyd's Rep 360;  1 WLR 2231 . It is said that there has been delay by Sana. I am not satisfied that there has been.
34 Certainly the chronology of events does not in the present case cause me to consider the interim injunction in the terms sought to be any less just and convenient. Indeed the point at which there is now clarity, available to all parties and after argument from all parties rather than one (however diligently that one sought to put both sides of the argument before the tribunal in the Lebanese Arbitration), is the decision of the Court of Appeal, on 28 July 2017.
35 It is sufficiently clear for the purpose of an interim injunction that, whatever their approach before, at that point all parties should have accepted that the Lebanese Arbitration should not continue. It is from that point that continuation by the Arbitration Claimants attracts the sense of abuse of the court's process that the authorities show is part of the way in which the terms vexation and oppression are used in the present context.
36 I find no delay past that point which is to be held against Sana. She invited undertakings on 2 August 2017 and issued an application for an interim injunction on 7 August 2017. The issue of the present application for an interim injunction followed on 15 September 2017 following an order made by consent by Popplewell J on 9 August 2017."
- On the facts of this case and although, as I say, it could be said that the claimant should have applied for an interim injunction as soon as it was notified of the proceedings in China, I am satisfied that this is not a case where comity considerations arise or where there have been substantive proceedings in China as a result of which there would be any question of this court second guessing an existing ruling of a Chinese Court. In addition, I accept that there is some benefit from the clarity that has been provided by the Qingdao Intermediate People's Court. I am satisfied that this is not a case where it would be any less appropriate to grant the relief sought as a result of the passage of time that has taken place.
- In this regard I also bear in mind that after being notified of the Qingdao Intermediate People's Court judgment Owners acted promptly in commencing Part 8 proceedings in this court and advancing that during the course of the vacation, first on the paper application that came before Robin Knowles J and, secondly, in the hearing today. I am therefore satisfied that there are no reasons as a result of any passage of time which would tell against the granting of the relief sought. Nor are there any other strong reasons not to grant an injunction in this case.
- Accordingly, applying the applicable principles I have identified above, and for the reasons given above, I am satisfied that this is an appropriate case for an interim injunction in the terms of the draft order that is before me and I will shortly hear from counsel to finalise the precise terms of that order.
- Before turning to that, however, I should say that one issue that arose before me was whether the court should in fact make a final order in relation to the relief that was sought given that this was an inter partes hearing of a claim for injunctive relief and the circumstances are such that no appearance has been made by the defendants. There are cases where this court is willing to treat the hearing of an interim injunction as a trial of the final and permanent injunction, see, for example, Donahue v Armco  2 Lloyd's Rep. 649 (Comm) at  per Aikens J. However, as was accepted on behalf of Owners, the only notification that has been given to the defendants of today's application is that this was a claim for interim relief. In addition, it is right to note that the arbitration claim form also seeks additional relief, including certain declarations. In those circumstances, I do not consider that it is appropriate, on the facts of the present case, to give final relief and, accordingly I grant interim relief in the terms set out in the draft order. I will hear Owners in relation to the appropriate order in relation to costs.
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