Originally from Investment Treaty Arbitration and International Law Volume 7

“To no one will we sell, to no one will we refuse or delay, right or justice.” -- Magna Carta, Clause 40.

Large international disputes can be a messy business. Such disputes often involve large investments, several large shareholders, lenders, a project company and, in many cases, state participation either directly or through the form of a state-owned enterprise. Each of these parties may have various claims and/or counterclaims. The disputes may implicate domestic law of various states, investment laws, treaties and other forms of international law. Allowing all these parties to press their claims and counterclaims could result in purportedly conflicting decisions, increased costs and some confusion, but not allowing these parties to press their claims as they see fit works a greater disservice to the legal system. Parties are not guaranteed a right to consistent decisions and low costs (not even in Canada). Rather, parties are guaranteed the rights such as the right to be heard, the right to attend the hearing and confront evidence, the right to counsel, etc.2 If the doctrine of lis alibi pendens was applied loosely, i.e., without the exact identity of parties and claims, parties would be subject to losing these fundamental rights for the sake of judicial efficiency.

The rationale for using lis alibi pendens to stay a parallel proceeding has been identified as fourfold:

“(a) as a pre-emptive corollary of the res judicata effect of foreign judgments; (b) to promote judicial efficiency; (c) as a means of declining or fine-tuning otherwise excessive exercises of original jurisdiction; and (d) to promote comity between courts.”3