In the UK, the availability of injunctive relief from the courts in support of arbitration is provided for by section 44 of the Arbitration Act 1996 ("Section 44"). In the case of AT & Others v Oil and Gas Authority, heard earlier this year, HHJ Pelling had to deal with an application under Section 44 seeking to restrain the OGA from circulating a Notice to certain third parties. The judgment provides some useful insights into the jurisdiction of the court when faced with an application under Section 44.
Section 44
Under Section 44, the court has the power to grant an interim injunction in support of arbitral proceedings, unless the parties have agreed to exclude the court's ability to do this.
Importantly, the court's powers under Section 44 are only available where the arbitral tribunal has no power or is unable to act effectively. These powers are particularly useful in the very early stages of an arbitration where an arbitral tribunal has not yet been established, or where the tribunal lacks the requisite powers of compulsion. In the case of AT & Others, the claimants were seeking interim relief before arbitral proceedings had even been commenced.
AT & Other v OGA – the background
The claimants all held Licences granted pursuant to the Petroleum Act 1998, which contained standard arbitration agreements. The OGA served a Notice on each of the licensees, and gave them an opportunity to comment on the content of the Notice prior to its further publication. Due to the nature of the proceedings, the decision does not reveal the identity of the claimants, go into any detail of what was contained in the Notice or provide the identity of the third parties who were to be sent the Notice. The claimants were of the view that the OGA's proposed course of action was (1) unlawful in the public law sense, (2) a breach of the relevant Licence and/or (3) irrational in the public law sense, and applied to the High Court seeking an injunction preventing the Notice's further publication.
Jurisdiction
Before considering the substance of the application, the court first had to determine whether it had jurisdiction to make the interim orders sought. Under Section 44, the Court has no jurisdiction to grant an interim order unless it can be satisfied that (1) there was a concluded arbitration agreement and (2) that the matter before it is one which could be referred to arbitration under that agreement.
There clearly was a concluded arbitration agreement. However, the key issue was whether the dispute between the Licensees and the OGA was a matter which could be referred to arbitration? To decide that question, the Court needed to examine the arbitration clause itself, which read as follows:-
"If at any time any dispute, difference or question shall arise between the Minister or the OGA and the Licensee as to any matter arising under or by virtue of this licence or as to their respective rights and liabilities in respect thereof then the same shall, except where it is expressly provided by this licence that the matter or thing to which the same relates is to be determined, decided, directed, approved or consented to by the Minister or the OGA, be referred to arbitration as provided by the following paragraphs …"
The OGA argued that the dispute was not one arising under or by virtue of the Licences, but that if it was wrong on that, the dispute was one which fell within the exception contained within the arbitration clause. The claimants argued that the language used in the clause was deliberately wide and clearly covered the dispute in question. In relation to the proviso, the claimants pointed out that there was no provision with the Licence that expressly empowered the OGA to adopt the course it was proposing to take and so it could not be a "matter or thing" that was decided, directed, approved or consented to by the Minister or the OGA.
HHJ Pelling decided that the dispute was a "… dispute … between … the OGA and the Licensor…as to any matter arising … by virtue of this Licence or as to their respective rights … in respect thereof …" The fact that the dispute concerned essentially public law principals did not mean it couldn't fall within the scope of the arbitration clause.
So far so good for the claimants.
However, HHJ Pelling went on to hold that the proviso did apply and that the dispute related to a "… matter or thing …" that was to be decided by the OGA. The judge noted that generally decisions by Government Ministers and the OGA are only capable of challenge on public law grounds and so determined in the context of judicial review proceedings, not arbitration. The proviso applied not only to decisions by the OGA regarding the exercise of its powers but also to decisions by the OGA as to how to exercise its discretion, including its decision making in relation to consultations prior to exercising that power. Therefore, the application under Section 44 failed because the dispute was not one to which the arbitration agreement applied.
The Court was prepared to grant the claimants the relief that they were seeking but only on the basis that it was a claim for interim relief in judicial review proceedings, and upon the claimants giving an undertaking to commence those judicial review proceedings in the Administrative Court forthwith. The Court would not have been willing to grant the interim relief sought pursuant to Section 44 of the Arbitration Act.
Conclusion
Therefore, while the claimants were ultimately successful in obtaining the relief they were looking for, it was not on the basis of Section 44. Those thinking of using Section 44 prior to the commencement of an arbitration need to carefully consider whether the dispute is one to which the arbitration agreement applies, and should not assume that, as with most applications for injunctive relief, the court will apply the test of whether there is a "serious issue" to be tried. Rather, it will seek to construe the arbitration clause and only if it considers that the agreement applies to the dispute will it be prepared to go on and consider exercising the powers available to it under Section 44.
The proviso in the arbitration clause provides a useful example of the type of express contractual exclusion that would have been needed for Manchester City Football Club ("MCFC") to be successful in its recent case against the Premier League. MCFC was seeking to persuade the court that the Premier League had no power to institute arbitral proceedings with a view to obtaining certain documents and information from MCFC as part of the League's ongoing disciplinary investigation. Moulder J in Manchester City Football Club Ltd v Football Association Premier League Ltd and others held that an express contractual exclusion would have been required within the arbitration clause and without it the League had power to institute the arbitral proceedings. The tribunal in that case had been right to conclude that it had jurisdiction to hear the arbitration.
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