DECISION BY THE ENGLISH COURT OF APPEAL, CIVIL DIVISION IN 2006 IN CASE NO. B6/2005/2737

Svenska Petroleum Exploration AB v. Government of the Republic of Lithuania and AB Geonafta

 

Subject Matters:

(1) Where a foreign state, which had agreed in writing to submit a dispute to arbitration within s.9(1) of the English State Immunity Act 1978, could claim immunity in respect of English proceedings under s.101(2) of the Arbitration Act 1996 to enforce a foreign arbitration award.

(2) Contract interpretation under Lithuanian law.

(3) Whether a party that does not challenge an arbitral award at the place of arbitration within a reasonable time will be precluded from attacking the award later at the place of enforcement of the award.

 

Findings:

(1) There was no basis for construing the State Immunity Act 1978 s.9 as excluding proceedings relating to the enforcement of a foreign arbitral award. Therefore, the foreign state, Lithuania, was not immune from proceedings to enforce the award.

(2) Lithuanian law attaches more significance to the intentions of the parties than in standard English interpretation of contracts.

(2) Under English law, a party must challenge the award at the place of arbitration before the passage of considerable time; otherwise the party may be precluded from objecting to the award later at the place of enforcement.

 

Parties:

Claimant: Svenska Petroleum Exploration AB, Sweden

Respondents: (1) Government of the Republic of Lithuania, (2) AB Geonafta, Lithuania

 

Counsel:

For the Claimant: Mr Michael Bools

For the Respondents: Mr Stewart Shackleton and Mr David Holloway