Bombay High Court
Hyundai Heavy Industries Co. Ltd vs Del Seatek India Private Limited on 18 April, 2022
Author: B. P. Colabawalla
Bench: B. P. Colabawalla
GANESH
SUBHASH
LOKHANDE
Digitally signed by
GANESH SUBHASH
LOKHANDE
Date: 2022.04.19 17.CARBP.542.2021.doc
19:06:15 +0530
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
COMMERCIAL ARBITRATION PETITION NO. 542 OF 2021
Hyundai Heavy Industries Co. Ltd. .. Petitioner
Vs.
Del Seatek India Pvt. Ltd. .. Respondent
Mr. Shyam Kapadia a/w Mr. Ruchir Goenka & Pulkit Dhawan i/b
Bose & Mitra & Co., for the Petitioner.
CORAM:- B. P. COLABAWALLA,J.
DATE :- APRIL 18, 2022.
P. C.:
1. By this Petition filed under Section 49 of the Arbitration and Conciliation Act, 1996 ("Arbitration Act"), the Petitioner seeks enforcement of the Interim Foreign Arbitration Award dated 6 th April, 2020 and Interim Costs Award dated 14th May, 2021 ("Foreign Awards").
2. Both the Awards are Foreign Awards within the meaning of Section 44 Part II of the Arbitration Act made pursuant to an agreement in writing under a Subcontract Agreement dated 29 th August, 2011 for the arbitration to be held in London, England under the rules of the Utkarsh page 1 of 11
17.CARBP.542.2021.doc London Court of International Arbitration ("LCIA"). The seat of arbitration under the Subcontract was at London.
3. The brief facts giving rise to the present Petition are this.
The Petitioner is a company incorporated under the laws of the Republic of Korea and the Respondent is a Private Company limited by shares being a company incorporated under the Companies Act, 1956 having its registered office at Mumbai, India. On 14th October 2010, the Petitioner entered into a contract with Indian Oil Corporation Ltd for an "SPM Facility Project". The Petitioner was engaged "to provide services in connection with an offshore construction project involving the construction of a single point mooring (SPM) facility and tie-ins at a location approximately 20 kilometres (equivalent to 10.8 nautical miles) offshore Paradip on the east coast of India" (Project). The work involved pipeline laying, SPM installation, and tie ins, over a number of "seasons", and the supply of a specialist pipe laying crane barge HYUNDAI 1000 (Barge), owned and operated by the Petitioner. Season II of the Project was scheduled to take place in 2011-2012.
4. In February 2011, the Respondent took out certain insurance policies in India, including employer's liability insurance, and commercial general and third-party liability insurance.
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5. On 29th August 2011 the Petitioner and the Respondent executed the Subcontract Agreement whereby the Respondent agreed to provide certain diving support service work to the Petitioner for Season II of the Project. For this purpose, the Respondent engaged a British national, Mr. Allan Peacock, to fill the position of a saturation diver in relation to the Project and on 1st November 2011, offshore installation work began on the Project.
6. On 10th November 2011, Mr. Peacock sustained an injury in the course of providing diving services relating to the Barge, which ultimately resulted in a below-knee amputation to his right leg.
7. Mr. Peacock first brought English Court Proceedings against the Petitioner and the Respondent on 4 th November, 2014 for damages arising out of his injury.
8. On 18th November, 2014 Irwin Mitchell LLP intimated the Petitioner of the claim proceedings of Mr. Peacock against the Petitioner. Accordingly, the Petitioner forwarded the email from Mr. Peacock's solicitors to the Respondent and asked the Respondent to advise on the proper course of action in light of article 17 of the Subcontract Agreement wherein the Respondent was required to Utkarsh page 3 of 11
17.CARBP.542.2021.doc indemnify and defend the Petitioner against any claims of the Respondent's employees and subcontractors, and asked the Respondent to appoint UK solicitors to defend this claim.
9. On 29th April 2015, the Respondent asked the Petitioner to "ignore" the correspondence from Mr. Peacock's solicitors and on 11th May 2015, the Respondent wrote to the Petitioner again confirming its indemnification obligations under the Subcontract.
10. It appears that the Respondent, despite giving various assurances to the Petitioner that it would defend and address the proceedings initiated by Mr. Peacock, failed to do so. Accordingly, the Petitioner instructed their English Solicitors to commence arbitration proceedings in terms of the Subcontract Agreement, against the Respondent under the LCIA rules, and the Petitioner accordingly filed a Request for Arbitration with LCIA on 26 th April 2019. It appears that the Respondent did not participate in this arbitration. They also failed to file a Response to Petitioner's Request for Arbitration, nor a Statement of Defence, nor communicated with the Tribunal in any way throughout the Arbitration proceedings, despite being given multiple opportunities. After due consideration of the documents, evidence and the law before it, and after hearing the submissions and arguments on behalf of the Utkarsh page 4 of 11
17.CARBP.542.2021.doc Petitioner, the LCIA tribunal passed a reasoned Interim Foreign Arbitration Award on the merits of the case on 6 th April 2020 wherein the Tribunal inter alia came to the following findings:-
a) That the Tribunal has jurisdiction over dispute, and the named Parties before it, pursuant to the Subcontract;
b) The Respondent was held liable under Article 17.1 of the Subcontract Conditions to save, indemnify, defend and hold harmless the Petitioner from and against any claims, losses, damages, and costs (including legal fees), expenses and liabilities in respect of the personal injury to Mr. Allan Peacock on 10 November 2011;
c) The Respondent was found to be in breach of its obligations under Article 17.1 of the Subcontract Conditions, in as much as the Respondent had failed to save, indemnify, defend and hold harmless the Petitioner from and against any claims, losses, damages, and costs (including legal fees), expenses and liabilities in respect of the personal injury to Mr. Allan Peacock on 10 November 2011;
d) The Respondent was ordered to pay the Petitioner the sums of £173,677.05 and USD 6,569 as damages, representing the amounts due under Article 17.1 of the Subcontract Conditions as of the date of the Foreign Utkarsh page 5 of 11
17.CARBP.542.2021.doc Arbitration Award;
e) The Respondent was ordered to pay the Petitioner the sum of £51,730.09, representing the arbitration (nonlegal) costs;
f) Respondent was ordered to pay interest on the amounts set out above in paragraphs (d) and (e), in the amount of 2% above LIBOR, compounded each quarter, running from the date the Petitioner paid the relevant amount through to the date of payment by the Respondent;
g) To avoid "double recovery" by the Petitioner, the Respondent was entitled to credit against the amounts set out above in paragraph (d) for the amount of any net recovery as may be made by Petitioner in respect of such amounts against Mr. Peacock in the English Court Proceedings (the amount of such credit to be determined by the Tribunal if not agreed);
h) The Tribunal further reserved its jurisdiction to: (i) determine and award amounts to the Petitioner in respect of claims, losses, damages and costs (including legal costs), expenses and liabilities which Petitioner may incur as a result of the personal injury to Mr. Peacock on 10th November 2011, plus interest thereon, and in relation to legal costs of the reference connected with the same, arising after 24 January 2020 (the date Utkarsh page 6 of 11
17.CARBP.542.2021.doc of Petitioner's revised schedule of loss, as addressed in the Interim Award); and (ii) assess the level of recoverable costs (if any) so awarded. The Tribunal would consult with the Parties regarding next procedural steps, leading in due course to a second Interim Award, and/or the Final Award.
11. Thereafter, the Tribunal, under the LCIA arbitration, passed a Interim Costs Award on 14th May 2021. In a nutshell :-
a) The Respondent was ordered to pay the Petitioner the sum of £91,088.31, representing the legal or other costs incurred by Petitioner to date in the LCIA arbitration;
b) The Respondent was ordered to pay the Petitioner the sum £13,844.68 representing the arbitration (nonlegal) costs incurred by the Petitioner in the LCIA arbitration, since the date of the Interim Foreign Arbitration Award to the date of the Interim Costs Award;
c) The Respondent was ordered to pay interest on the amounts set out above in paragraphs (a) and (b), in the amount of 2% above LIBOR, compounded each quarter, running from the date the Petitioner paid the relevant amount through to the date of payment by the Respondent.
Utkarsh page 7 of 11
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d) The Tribunal reserved its jurisdiction to: (i)
determine and award amounts to the Petitioner in respect of claims, losses, damages and costs (including legal costs), expenses and liabilities which the Petitioner may incur as a result of the personal injury to Mr. Peacock on 10 November 2011, plus interest thereon, and in relation to legal costs of the reference connected with the same, not addressed by the Interim Foreign Arbitration Award and the Interim Costs Award; and (ii) assess the level of additional recoverable costs (if any) so awarded.
12. As mentioned earlier, the Interim Foreign Arbitration Award and the Interim Costs Award are together referred to as the Foreign Awards.
13. The Petitioner submits that the Interim Foreign Arbitration Award and the Interim Costs Award are Foreign Awards as contemplated under section 44 of the Arbitration Act and are enforceable under Part II of the Arbitration Act. The Petitioner further submits that they are in compliance with Section 47 of the Arbitration Act, and have produced (i) the Original Awards, (ii) the certified copy of the Subcontract Agreement which incorporates the arbitration clause, and (iii) an affidavit of the English Solicitor to satisfy that both the Awards are Foreign Awards and binding as per English Law.
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14. The Petitioner's prayers in the present petition are to recognize and enforce the said Foreign Awards made in favour of the Petitioner and that the Interim Foreign Arbitration Award dated 6 th April 2020 and the Interim Costs Award dated 14 th May 2021 passed by the Tribunal be declared enforceable as a decree of this court as per section 49 of the Arbitration Act.
15. At this juncture, it is noted that the Petitioner has served the Respondent with copy of the instant petition, and furnished an Affidavit of Service dated 9th December 2021 to that effect. To give the Respondent another opportunity to raise any grounds for refusal of the enforcement of the Foreign Awards under section 48 of the Arbitration Act, this court in its order dated 15 th March 2022 directed that a copy of the said order be served on the Respondent by hand delivery and made it clear that if the Respondent did not appear on the next occasion despite service, this Court would proceed to pass orders in their absence.
16. The Petitioner, in terms of the order dated 15 th March 2022, has furnished an Affidavit of Service dated 28 th March 2022 evidencing the service of the Order of the court upon the Respondent on 17 th March Utkarsh page 9 of 11
17.CARBP.542.2021.doc 2022. Despite being served with the notice of the present Petition and the order dated 15th March 2022, the Respondent has failed to appear before this court and raise any grounds of opposition under Section 48 of the Arbitration Act. Therefore, assistance of the court is being sought in terms of the prayers in the petition on the ground that all requirements of Section Section 47 of the Arbitration Act are complied with and the Respondent has not raised any grounds to oppose the above Enforcement Petition.
17. I have perused the Foreign Awards and can confirm that they appear to be reasoned Awards. I have also perused the documents filed by the Petitioner to evidence the compliance with section 47 of the Arbitration Act. The Petition for enforcement of the Foreign Awards are in accordance with law and in compliance with section 47 of the Arbitration Act. Having perused the Foreign Awards, I also do not find any ground under section 48(2) of the Arbitration Act to assail the same before me. I am satisfied that the Foreign Awards are enforceable and the Foreign Awards shall be deemed to be a decree of this court.
18. I am of the view that the Foreign Awards stand as decrees and the Petitioner holding the said Foreign Awards has become entitled for enforcement of the said Foreign Awards and for taking effective Utkarsh page 10 of 11
17.CARBP.542.2021.doc steps for execution of the same. I therefore pass the following order:-
Commercial Arbitration Petition No. 542 of 2021 is made absolute in terms of prayer clause (a) which reads thus:-
"That this application to recognize and enforce the said Foreign Awards made in favour of the Petitioner be allowed and this Hon'ble Court be pleased to declare the Interim Foreign Arbitration Award dated 6 th April 2020 and Interim Costs Award dated 14th May 2021 passed by the Tribunal comprising of Ms. Krista Lee QC, Mr. Greg Fullelove, and Ms. Lucy Martinez enforceable as a decree of this Hon'ble Court"
19. The Petition is accordingly disposed of. However, there shall be no order as to costs.
20. This order will be digitally signed by the Private Secretary/Personal Assistant of this Court. All concerned will act on production by fax or email of a digitally signed copy of this order.
( B. P. COLABAWALLA, J. )
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