A High Court judge has refused to enforce a multi-million-pound arbitration award and judgment after finding they were ‘fabrications’. The Honourable Mr Justice Butcher said his decision raised ‘unanswered but serious questions’ that would require investigation.

The judgment in Contax Partners Inc BVI v Kuwait Finance House (KFH-Kuwait) & Ors centres on an order giving Contax BVI, described as an oil and gas company, leave to enforce a Kuwaiti arbitration award of more than £70m.

The judge said ‘in retrospect’ he gave ‘undue allowance’ in the original application ‘for difficulties apparently arising from documents being prepared by people who were not native English speakers and/or whose grasp of English procedure was not perfect’.

The defendants argued that the order had not been validly served ‘but, ‘more than this, … there was never an arbitration at all’.

Agreeing that ‘substantial parts’ of the award had been taken from Mr Justice Picken’s judgment in Manoukian v Société Générale de Banque au Liban SAL the judge said: ‘The defendants contend that…there is no real doubt, and no triable issue, that the award is not genuine and is a fabrication. In my view, this is indeed the case.’

He said it was ‘very unlikely that the alleged arbitration agreement is genuine’ and there were ‘very strong grounds for concluding that the award itself is a fabrication’, including the award’s language; and that, following evidence from the defendants, the award did not comply with ‘basic requirements of Kuwaiti law’ and those named as being involved in the arbitration were not.

Discussing what had been taken from another judgment, and including examples, the judge said: ‘It is in my judgment obvious…that is the case from a comparison of the two, and a consideration of the nature of the text which appears in each.

‘A further passage indicates that, if the award were genuine, it would mean that the arbitration had played out in a way which was uncannily – one might fairly say miraculously – similar to what had happened in front of Picken J.’

 

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