Partial Enforcement of Award Which Has Not Yet Become Final

IPCO (Nigeria) Ltd. v Nigerian Nat’l Petroleum Corp., 2008 WL 1771454, [2008] EWHC 797 (Queen’s Bench Div., Commercial Ct.)

IPCO contracted with NNPC to design and build a petroleum export terminal in Nigeria.  A dispute ensued and was arbitrated in Nigeria, subject to the supervision of the Nigerian courts.  IPCO obtained an award in October 2004 (in the sum of approximately US$152 million) and sought an order for its enforcement in England.  At the same time, NNPC brought an appeal against the award.  The English High Court granted an order to IPCO, but adjourned enforcement of the award pending the Nigerian appeal.  Subsequent developments in Nigeria had meant that any appeal against the award now lay some five or ten years in the future.  IPCO applied for a variation of the order adjourning enforcement of the award.

The Judge granted a variation allowing immediate partial enforcement of the award (in the sum of approximately US$52.5 million).  A “significant change in circumstances” was required to reopen the English claim.  Developments in the Nigerian challenge proceedings since the English were characterised as “catastrophic.”  However, the change in circumstances would not of itself justify a reconsideration of the court’s earlier assessment of the strength of the Nigerian challenge proceedings.  In this case, the factor which tipped the balance was the fact that the original judge had been, albeit inadvertently, misled as to the strength of the challenge to the award. 

The decision provides useful guidance on the extent to which the court is permitted to revisit an interlocutory decision on enforcement of an award.  It also appears to be the first in an English court allowing partial enforcement of a New York Convention award (other than in the limited jurisdictional context expressly envisaged by section 103(4) of the Act).

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