{"id":8008,"date":"2023-03-15T15:16:41","date_gmt":"2023-03-15T20:16:41","guid":{"rendered":"https:\/\/www.campbellslegal.com\/?p=8008"},"modified":"2023-05-19T08:25:39","modified_gmt":"2023-05-19T13:25:39","slug":"foreign-arbitral-awards","status":"publish","type":"post","link":"https:\/\/www.campbellslegal.com\/articles\/foreign-arbitral-awards-8008\/","title":{"rendered":"Cayman Court confirms its jurisdiction to recognise and enforce foreign interim arbitral awards"},"content":{"rendered":"<p>The use of arbitration to resolve cross-border disputes is dependent on the ability of the parties to enforce the tribunal\u2019s decisions, whether they be interim or final awards, in jurisdictions where the parties are either located or have assets. In practical terms, this requires the offshore financial centres in particular to adopt a pro arbitration stance in terms of the legislation they introduce and by the courts adopting a purposive interpretation of that legislation to give effect to its intended purpose.<\/p>\n<p>The Cayman court\u2019s jurisdiction to enforce final arbitral awards made by a tribunal in a foreign seated arbitration is well established under section 5 of the Foreign Arbitral Awards Enforcement Act (1997 Revision) (the \u201c<strong>Enforcement Act<\/strong>\u201d, which gives effect to the New York Convention of 1958 as a matter of Cayman law.\u00a0 Unless one of the established grounds for refusal exist (and the burden is on the respondent to establish such grounds), the Court will typically grant orders for recognition and enforcement administratively on the papers which allows for the application to be dealt with in a time and cost efficient manner, with judgment being entered in the terms of the award which can then be enforced in the same manner as a Court judgment. \u00a0However, obtaining a judgment and successfully enforcing a judgment are two different things and \u201cprovisional\u201d or \u201cinterim\u201d relief is often required to increase the prospects of the latter. The approach to be taken by national courts in relation to provisional awards has evolved in recent years on a jurisdiction by jurisdiction basis.<\/p>\n<p>In a judgment delivered on 3 February 2023, the Cayman court considered for the first time whether the existing legislation in the Cayman Islands allows for the recognition and enforcement of interim awards made by a foreign seated tribunal, which in that case concerned an order for security and for a freezing order over the respondent\u2019s assets up to the value of the unsecured amount in dispute pending the determination of the arbitration.<\/p>\n<p>The Court considered two jurisdictional gateway arguments for recognition and enforcement of interim awards:<\/p>\n<ul>\n<li>the term \u201caward\u201d, as defined in the Enforcement Act, is intentionally broad and includes both final and provisional awards as a matter of statutory construction; and\/or<\/li>\n<li>section 5 of the Enforcement Act is to be read alongside the relevant provisions of the Cayman Islands Arbitration Act, 2012 (the \u201c<strong>Arbitration Act<\/strong>\u201d) which contains express provisions relating to the enforcement of interim measures made by tribunals irrespective of the jurisdiction in which they are issued, with the effect that section 5 of the Enforcement Act extends to foreign interim awards.<\/li>\n<\/ul>\n<p>The Court held that prior to the enactment of the Arbitration Act in May 2012, there was arguably no jurisdictional basis to enforce foreign interim awards under the Enforcement Act but that the scope of the Enforcement Act had been \u201c<em>implicitly expanded<\/em>\u201d to incorporate those provisions of the Arbitration Act which allow for the enforcement of domestic and foreign interim awards. The Court also held that jurisdiction existed on a standalone basis under the Arbitration Act, without reference to the Enforcement Act, with the practical effect that \u201c<em>foreign interim arbitration awards or measures, whatever nomenclature they may be given, are clearly enforceable under Cayman Islands law<\/em>.\u201d<\/p>\n<p>It is relevant to note that under section 54 of the Arbitration Act, the Cayman court has a standalone power to issue interim measures in support of domestic or foreign arbitration proceedings having regard to specific principles of international arbitration. Such measures would include security for costs, disclosure, compelling a witness to attend court and give evidence or produce documents, the power to secure the amount in dispute and\/or to prevent the dissipation of assets against which an award may be enforced and the power to grant interim injunctions in support of the foreign arbitration. As a matter of practice, the Cayman Court would expect an applicant to seek such relief in the first instance from the tribunal, if constituted, or from an emergency arbitrator (as provided for under some institutional arbitration rules). Whilst unexplored in the judgment, the writer\u2019s view is that there is a jurisdictional basis for interim measures ordered by an emergency arbitrator to be recognised and enforced in the Cayman Islands under the existing legislation.<\/p>\n<p>Liam Faulkner of Campbells acted for the successful applicant in the case.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>In a judgment delivered on 3 February 2023, the Cayman court considered for the first time whether the existing legislation in the Cayman Islands allows for the recognition and enforcement of interim awards made by a foreign seated tribunal.<\/p>\n","protected":false},"author":4,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[5],"tags":[],"yst_prominent_words":[1454,995,3982,58,15,419,3670,2171],"class_list":["post-8008","post","type-post","status-publish","format-standard","hentry","category-articles"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.campbellslegal.com\/wp-json\/wp\/v2\/posts\/8008","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.campbellslegal.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.campbellslegal.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.campbellslegal.com\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/www.campbellslegal.com\/wp-json\/wp\/v2\/comments?post=8008"}],"version-history":[{"count":8,"href":"https:\/\/www.campbellslegal.com\/wp-json\/wp\/v2\/posts\/8008\/revisions"}],"predecessor-version":[{"id":8022,"href":"https:\/\/www.campbellslegal.com\/wp-json\/wp\/v2\/posts\/8008\/revisions\/8022"}],"wp:attachment":[{"href":"https:\/\/www.campbellslegal.com\/wp-json\/wp\/v2\/media?parent=8008"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.campbellslegal.com\/wp-json\/wp\/v2\/categories?post=8008"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.campbellslegal.com\/wp-json\/wp\/v2\/tags?post=8008"},{"taxonomy":"yst_prominent_words","embeddable":true,"href":"https:\/\/www.campbellslegal.com\/wp-json\/wp\/v2\/yst_prominent_words?post=8008"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}