A global economy requires global consistency in legal decision-making and English judges are very reluctant to go behind the rulings of foreign courts – however much they may disagree with them. In one such case, the High Court refused to order enforcement of an arbitration award that had been overturned by a Russian judge.
The case concerned a dispute between a businessman and a company – both of them Russian – in respect of the sale of a majority stake in the former’s metallurgical business. Following a hearing before three highly distinguished arbitrators in Moscow, the businessman was awarded over eight billion roubles.
The award was, however, subsequently overturned by a Russian commercial judge and the businessman’s appeals against that decision were rejected. His lawyers nevertheless launched proceedings in London to enforce the award on the basis that the Russian judge’s decision was so obviously incorrect as not to be open to a court acting in good faith.
In ruling on the matter, the High Court noted that the burden on the businessman was a heavy one. It was not enough for him to establish that the Russian judge’s ruling was wrong, or even manifestly wrong. It had to be shown that it was so perverse that it could not have been arrived at other than by bias.
The Russian judge’s criticism of the arbitrators appeared harsh, but his decision that they lacked independence had been upheld on appeal. It could not be said that his decision was so perverse that it could only be ascribed to bias or a lack of good faith. In the circumstances, the Court refused to recognise or enforce the award.