Michael Wilson & Partners Ltd v Emmott

The principal issue on this appeal is whether the claimant is, as the judge below held, entitled to an anti-suit injunction restraining the defendant from pursuing foreign proceedings in view of an arbitration agreement between them governed by the law of England and Wales and the arbitration which has been completed in London pursuant to that agreement.

This is an appeal from the order of Mrs Justice O’Farrell dated 24 November 2016 by which she granted an anti-suit injunction prohibiting the defendant, Michael Wilson & Partners, Ltd (“MWP”), from taking any further steps to pursue proceedings filed by MWP in the Supreme Court of New South Wales on 2 February 2016 (“NSW2”) against the claimant, John Forster Emmott. Among other things, the order also directed MWP to cause an application to be filed in NSW2 to discontinue those proceedings and to take all steps necessary to ensure that those proceedings are discontinued in accordance with the terms of the order.

The dispute which has led to the present proceedings has a long history of hard fought litigation over more than 10 years in several jurisdictions, including Australia, the Bahamas, the British Virgin Islands and England.

The dispute has its origins in an agreement dated 7 December 2001 (“the MWP Agreement”) between Mr Emmott, an English and New South Wales qualified solicitor, and MWP, acting by its ultimate beneficial owner and controller, Michael Wilson, an English qualified solicitor. MWP was incorporated in the British Virgin Islands. It has an established legal practice in Kazakhstan.

The purpose of the MWP Agreement was to establish a “quasi partnership”, under which Mr Emmott became a director of MWP and the shares in MWP were to be divided as to 33% to Mr Emmott and as to 67% to WFA-Windsor Fine Arts Establishment, a corporate vehicle associated with Mr Wilson.

Clause 5.2 of the MWP Agreement contained the following arbitration provision:

“This Agreement shall be governed by and interpreted in accordance with the laws of England and Wales and all and any disputes shall be referred to and are subject to arbitration in London before a tribunal of three arbitrators with one arbitrator to be appointed by each party and the chairman of the tribunal to be appointed by the President of the Law Society.”

On 20 December 2005 Mr Emmott entered into an agreement with David Ross Slater, Robert Nicholls and Arman Shaikenov, which bears the heading “Cooperation Agreement” (“the Co-operation Agreement”). Mr Slater and Mr Nicholls were Australian lawyers who had joined MWP as employees and were subject to restrictive covenants. Mr Shaikenov was a Kazakh lawyer. The Co-operation Agreement recited that Mr Shaikenov and Mr Slater proposed to establish and operate a consultancy business and that, as and when they were legally free to do so, Mr Nicholls and Mr Emmott would be able to join the consultancy on the basis set out in the Co-operation Agreement. The Co-operation Agreement provided for the establishment of the consultancy to be owned and operated by Temujin International Ltd (“TIL”) “acting as the trustee under a trading trust” and an associated service company, Temujin Services Ltd (“TSL”), (together “Temujin”). The Co-operation Agreement provided for the issue of 4 units in the trust, one to be held by or on behalf of each of Mr Slater and Mr Shaikenov, and one to be held by or on behalf of each of Mr Nicholls and Mr Emmott should they elect to participate.

Clause 7 of the Co-operation Agreement provided that the Co-operation Agreement was to be governed by, and construed in all respects in accordance with, the laws of England and Wales. It also provided that “any and all differences, discrepancies, divergences or disputes arising out of or in connection with [the Co-operation Agreement]” were to be resolved by arbitration in English in London or such other location as the parties may agree under the rules of the London Court of International Arbitration.

In December 2005 Mr Slater left MWP to work at Temujin and Mr Nicholls joined him in March 2006.

Mr Wilson and Mr Emmott fell out in the middle of 2006, each purporting to accept a repudiatory breach of the MWP Agreement by the other. Mr Emmott left MWP on 30 June 2006 and went to work for Temujin.

In August 2006 MWP gave notice of arbitration to Mr Emmott under clause 5.2 of the MWP Agreement. The arbitrators were Mr Christopher Berry (chairman), Lord Millett and Ms Valerie Davies. Mr Berry and Ms Davies were highly experienced and eminent solicitors.

MWP advanced numerous claims against Mr Emmott, including the claim that, while still a director of MWP, he diverted work, commercial opportunities, clients and potential clients to Temujin. The allegations of diversion related to several matters, including those given the following shorthand references in the evidence before us: Chilisai (lost fees), Chilisai (success fees), Urals Gold, Roxi, Project X, Eragon and ADA, Benkala Copper, Project Ablai, Lancaster Group/Maersk and Kangamiut (“the diversion allegations”).

Mr Emmott, for his part, claimed that he was entitled to 33% of the issued share capital of MWP. That claim was denied by MWP on the ground that the conditions under which Mr Emmott was to become entitled to the shares were not satisfied before his departure.

The arbitration took place over many days between 2006 and 2014. There were over 30 days of hearing evidence. It was conducted in two principal stages. The first was on liability, and the second on quantum.

The arbitrators addressed liability in a Second Interim Award made on 19 February 2010 (“the SIA”) and a “Clarification” dated 6 April 2010. The SIA ran to 159 pages. For the purposes of their determination of liability, the arbitrators heard oral evidence from 12 witnesses and read witness statements from a further 13 witnesses. Each side was represented by leading counsel and a number of junior counsel as well as solicitors.

The arbitrators concluded that Mr Emmott was entitled to have his 33% shareholding in MWP issued or transferred by the end of the calendar year 2004. They concluded that Mr Emmott, for his part, had in many respects and on numerous occasions from August 2005 until his departure on 30 June 2006 been guilty of deliberate, serious and dishonest breaches of his fiduciary obligations to MWP. In particular, he assisted Mr Slater and Mr Nicholls to establish Temujin, a competitor, without informing Mr Wilson of what was going on, and he prevaricated or lied in order to conceal the truth. In the Clarification the arbitrators made it plain that they found that Mr Slater was the instigator and leading spirit behind the establishment of Temujin, that he enrolled Mr Nicholls, and that Mr Emmott went along with it and resolved to join the new firm in due course, but Mr Emmott was not the lead player. He was, however, in breach of his obligations under the MWP Agreement to devote his full time and attention to developing the practice and business of MWP because he was devoting time to assist the development of Temujin. Furthermore, Mr Emmott undercharged or failed to charge clients for work undertaken by MWP.

The arbitrators considered that the fairest and most practical solution was to treat Mr Emmott’s liability to compensate MWP for his undercharging as satisfied by denying him the right to recover anything for the work he did for MWP during the same period. In effect, the arbitrators considered the most appropriate and convenient course was to take the accounts as if the parties were partners and their partnership was dissolved on 31 December 2005.

The arbitrators made a third award on quantum (“the TQA”) on 5 September 2014. It ran to 85 pages. For the purposes of establishing quantum, the arbitrators received written and oral evidence from 12 witnesses, 9 of whom were different from those who had previously given oral evidence.

They valued Mr Emmott’s 33% share of MWP as at 31 December 2005 at US$749,141. They held that he was also entitled to a 27% interest in a holding of shares in Steppe Cement Limited (“Steppe”) to which MWP had become entitled as recompense for work done for a particular client. The arbitrators held that the fair value of Mr Emmott’s 27% interest in the Steppe shares as at 31 December 2005 was £2m.

Adjusting the figures to take account of the credit on Mr Emmott’s current account, sums for which Mr Emmott was liable to account to MWP, including in respect of some of the diversion allegations, and interest, the arbitrators found that there was a balance due from MWP to Mr Emmott of £3,209,613 and US$841,213. Only part of those sums have been paid. There were various appeals by MWP in respect of the arbitrators’ awards, all of which were dismissed.

In October 2006 MWP commenced proceedings in New South Wales (“NSW1”) against, among others, Mr Nicholls, Mr Slater, TIL and TSL for an account of profits and damages. It was alleged in NSW1, among other things, that Mr Nicholls and Mr Slater solicited MWP’s contacts, clients, employees and consultants in breach of the terms of their employment contracts with MWP, and dishonestly and fraudulently breaching their fiduciary duties and duty of care to MWP. It was alleged that they also knowingly participated and assisted in breaches of fiduciary duties owed by Mr Emmott to MWP. It was alleged that Temujin knowingly participated and assisted in the alleged breaches of duty owed by Mr Nicholls, Mr Slater and Mr Emmott. It was also alleged that they all conspired against MWP. The allegations included the diversion allegations that had been advanced by MWP in the arbitration.

Einstein J found in favour of MWP in respect of all the diversion allegations, even in those cases where the arbitrators had dismissed the allegations against Mr Emmott. Einstein J made findings of fiduciary liability, breach of contract, and conspiracy to injure by unlawful means. He also made numerous findings of accessorial liability and knowing participation in breaches of duty owed to MWP by Mr Nicholls, Mr Slater and (even though he was not a party) Mr Emmott. He made various monetary awards against Mr Nicholls, Mr Slater and Temujin in respect of their joint and several liability.

There was an appeal from the orders of Einstein J to the Court of Appeal of New South Wales, and a further appeal from the Court of Appeal to the High Court of Australia, which remitted the matter to the Court of Appeal for further consideration of certain matters. So far as relevant, the final outcome was judgment against Mr Nicholls, Mr Slater and Temujin for a joint and several liability in favour of MWP for US$676,335 and €555,259.94 together with interest.

In his judgment Einstein J said:

“the Co-operation Agreement was deliberately drafted in a way to suggest that Messrs Nicholls and Emmott were not bound to join the new venture but this was an attempt to disguise what was really an immediate partnership involving each of Mssrs Nicholls, Slater and Emmott.”

Between October 2015 and August 2016 MWP procured assignments (“the assignments”) to itself from the liquidator of TIL, the liquidator of TSL, the trustees in bankruptcy of Mr Nicholls and the trustees in bankruptcy of Mr Slater of the rights of TIL, TSL, Mr Nicholls and Mr Slater respectively (“the assignors”) to contribution from Mr Emmott in respect of their joint and several liability in NSW1 and in connection with the Temujin business. Each of the assignments was stated to be subject to the law of New South Wales.

On 2 February 2016 MWP, in reliance on the assignments, commenced NSW2 claiming “joint and several liability, contribution and indemnity on behalf of and in the name of each assignor arising out of [NSW1]” and also various heads of relief (including accounts and enquiries) relating to the assets and affairs of what is alleged to have been a partnership between Mr Emmott, Mr Nicholls and Mr Slater in Temujin, including the matters which were the subject of the diversion allegations in the arbitration.

Mr Emmott issued the claim form in these proceedings on 25 February 2017 claiming, among other things, an anti-suit injunction restraining MWP from continuing its claims in NSW2 or commencing or pursuing any other claim or proceedings arising out of or in relation to the MWP Agreement or the Co-operation Agreement otherwise than in accordance with clause 5.2 of the MWP Agreement or clause 7 of the Co-operation Agreement.

On 2 March 2016 Mr Justice Burton granted interim anti-suit relief on a “without notice” application.

The matter came before Mrs Justice O’Farrell on the return date. She heard the application over three days. She swiftly handed down her careful and detailed reserved judgment on 24 November 2016, in which she determined to continue the anti-suit injunction ordered by Burton J.

For the purpose of this appeal, and with no disrespect to the Judge, it is sufficient to summarise her reasons very briefly as follows. First, she held that the assigned claims for contribution and account in NSW2 fall within the ambit of the arbitration clause in the MWP Agreement. Secondly, she held that, if she was wrong about the ambit of the arbitration clause in the MWP Agreement, the assigned claims in respect of Mr Nicholls and Mr Slater, but not TIL and TSL, would fall within the arbitration clause in the Co-operation Agreement. Thirdly, she held that, although there was no cause of action estoppel arising out of the arbitration, there was an issue estoppel in respect of breaches of contractual and fiduciary duties by Mr Emmott as a result of the diversion of clients and business from MWP to Temujin and the concealment of assets. Fourthly, she said that NSW2 was a collateral attack on the arbitration award and amounted to an abuse of process. Fifthly, she said that, when issuing NSW2, MWP had dishonestly misrepresented that Mr Emmott was domiciled and resided in New South Wales when it knew that Mr Emmott had not lived in New South Wales for many years. Sixthly, and finally, she held that, since there had been final and binding proceedings under the dispute resolution procedure agreed by the parties, it would be unfair and contrary to the policy of finality to permit Mr Emmott to be vexed by further litigation.

For completeness, I should mention that the Judge rejected a submission on behalf of MWP that the interim injunction granted by Burton J should be set aside and the application for its continuation dismissed on the ground that Mr Emmott misled the court by wrongly stating that the arbitrators found that Mr Emmott was not a partner in Temujin when in fact no such finding was made by the arbitrators. The Judge considered that the skeleton argument for the interim application accurately reflected that the arbitrators were asked, but refused, to make a finding that Mr Emmott was a partner in Temujin.

Permission to appeal was granted in respect of the first to fourth findings of the Judge mentioned in paragraph 30 above. Although not separately specified, it is implicit that MWP intended to appeal and was permitted to appeal the sixth finding of the Judge mentioned in paragraph 30 above. Permission was also granted for MWP to contend that the Judge had erred in law in failing to give any, or any adequate reasons, for those findings.

At the hearing of the appeal, MWP sought permission to appeal the fifth finding of the Judge mentioned in paragraph 29 above and to contend that she failed to give any or any adequate reasons for it.

The general principles as to the grant of an anti-suit injunction were not in dispute on the appeal.

The jurisdiction derives from section 37 of the Senior Courts Act 1981, which provides as follows:

“(1)

The High Court may by order (whether interlocutory or final) grant an injunction or appoint a receiver in all cases in which it appears to the court to be just and convenient to do so.”

In very broad terms, the touchstone for the grant of an anti-suit injunction, as with any other injunction, is what the ends of justice require. This determination involves an exercise of discretion by the court. The particular facts of the case are critical to the exercise of this discretion. Subject to the particular facts, and the overriding discretion of the court in achieving the interests of justice, the following principles for the exercise of the discretion are well established.

In Société Nationale Industrielle Aerospatiale v Lee Kui Jak [1987] AC 871 (PC) at 892, Lord Goff (giving the judgment of the board) held that the following four principles govern the grant of an anti-suit injunction. (1) The jurisdiction is to be exercised when the ends of justice require it. (2) Where the court decides to grant an injunction restraining proceedings in a foreign court, its order is directed not against the foreign court but against the parties so proceeding or threatening to proceed. (3) An injunction will only be issued restraining a party who is amenable to the jurisdiction of the court, against whom an injunction will be an effective remedy. (4) Since such an order indirectly affects the foreign court, the jurisdiction is one which must be exercised with caution.

In Donohue v Armco Inc [2001] UKHL 64, [2002] 1 Lloyd’s Rep 425, Lord Bingham (with whom the majority of the appellate committee agreed) noted and approved those principles (at [19]). He went on to say (at [24]) that, if contracting parties agree to give a particular court or tribunal exclusive jurisdiction to rule on claims between them, and a claim falling within the scope of the agreement is made in a forum other than that which the parties have agreed, the English court will ordinarily exercise its discretion to grant an anti-suit injunction in order to secure compliance with the contractual bargain, unless the party suing in the non-contractual forum can show strong reasons for suing in that forum: Donohue at [24].

Donohue concerned a clause providing for the exclusive jurisdiction of the English courts. The same approach would apply to an arbitration agreement governed by the law of England and Wales. Bearing in mind, however, the caution that must be exercised in respect of injunctions against foreign proceedings, the court requires a high degree of probability that there is an arbitration agreement which governs the dispute in question where, as in the present case, an anti-suit injunction is sought in respect of foreign proceedings: Ecobank Transnational Inc v Tanoh [2015] EWCA Civ 1309, [2016] 1 WLR 2231 at [89].

More generally, it may be appropriate to grant an anti-suit injunction where a matter is justiciable in both an English and a foreign court and the proceedings before the foreign court are vexatious or oppressive: Société Nationale Industrielle Aerospatiale at 896.

I respectfully do not agree with the Judge that the claims in NSW2 fall within the ambit of the arbitration clause in the MWP Agreement.

It is true that the scope of clause 5.2 of the MWP Agreement - “all and any disputes” - is extremely wide. It also true that MWP and Mr Emmott are the parties to NSW2 and the MWP Agreement and that the matters, or at any event many of the matters, in NSW2 concern alleged breaches of obligations owed by Mr Emmott to MWP in relation to the running of MWP’s business.

The rights, however, which MWP seeks to enforce in NSW2 are the rights of Mr Nicholls, Mr Slater and Temujin, none of whom were parties to the MWP Agreement or bound by the arbitration. I do not agree with the Judge’s statement in [44(v)] that, by virtue of the assignments, “the claims for contribution and account against Mr Emmott are made by MWP to enforce its own rights”.

If the assignors had brought contribution proceedings against Mr Emmott in their own names, the arbitration agreement in the MWP Agreement and the awards of the arbitrators would have been no bar. MWP, as assignee of their rights can be in no worse position unless the MWP Agreement expressly or impliedly provides that the assignors’ rights of contribution, if acquired by assignment to MWP, would fall within the scope of clause 5.2.

The Judge referred to Lord Hoffmann’s observations in Fili Shipping Co Ltd v Premium Nafta Products Ltd [2007] UKHL 40, [2007] Bus LR 1719, at [5] – [8] and [13] about the interpretation of arbitration agreements. In that case Lord Hoffmann emphasised the need for the court to give effect, so far as the language used by the parties will permit, to the commercial purpose of the arbitration clause. He also said that the interpretation of an arbitration clause should start from the assumption that the parties, as rational businessmen, are likely to have intended any dispute arising out of the relationship into which they have entered or purported to enter to be decided by the same tribunal.

On the face of it, the “disputes” mentioned in clause 5.2 of the MWP are disputes between MWP and Mr Emmott in their capacity as quasi-partners. They are not disputes between third parties and one or other of MWP and Mr Emmott. MWP, as assignee under the assignments, is not advancing in NSW2 its own claims as a quasi-partner or former quasi-partner of Mr Emmott. It is advancing the claims of the assignors who were not quasi-partners of MWP and were not parties to the MWP Agreement. So far as concerns any reliance that the Judge may have placed on the comment of Lord Hoffmann in Fili Shipping Co Ltd mentioned at the end of paragraph 45 above, far from it being likely, it seems to me to be highly unlikely that, at the time they entered into the MWP Agreement, Mr Emmott and MWP had any intention to include such claims within clause 5.2.

That is most graphically illustrated by the claims in NSW2 in relation to the alleged partnership between Mr Nicholls, Mr Slater and Mr Emmott in Temujin, in particular as to the determination of their respective shares in such partnership, and accounts and enquiries as to partnership dealings (“the Temujin partnership claims”). The Temujin partnership claims are, in effect, final or dissolution partnership accounts between the alleged partners where there is no allegation that the only business ever carried on by that partnership comprised business and opportunities wrongfully diverted from the MWP quasi-partnership.

Turning to the Co-operation Agreement, it is not in dispute that the claims in NSW2, insofar as they relate to TIL and TSL, do not fall within the arbitration provisions in clause 7 of the Co-operation Agreement as neither of those entities was a party to the Co-operation Agreement. I respectfully do not agree with the finding of the Judge that the claims in NSW2, insofar as they relate to Mr Nicholls and Mr Slater, fall within clause 7. Neither the Judge nor this Court is presently in a position to conclude that they do.

In the passage in his judgment quoted in paragraph 24 above, Einstein J appeared to indicate that the Co-operation Agreement was a sham. The arbitrators expressly declined in the SIA (see para. 8.22) to reach a conclusion as to whether Mr Emmott was or was not a partner in the Temujin business. Mr Emmott’s consistent case has always been that he was only ever a consultant on the terms of one or other of two unsigned consultancy agreements in evidence. His reliance on clause 7 for the purpose of obtaining an anti-suit injunction is, in short, entirely contrary to the case he has consistently advanced over many years in England and Australia and the case which he intends to run in NSW2 should MWP be able to pursue those proceedings. Certainly, we have not been shown any evidence that he ever subscribed for his one unit in the Temujin trust mentioned in the Co-operation Agreement. Mr Emmott maintains that there was never any specific determination in NSW1, and certainly no determination binding on him, that he was a partner with Mr Nicholls and Mr Slater in the Temujin business. Under the law of this jurisdiction Mr Emmott is not bound by any finding of Einstein J as to Mr Emmott’s status as a partner in the Temujin business because Mr Emmott was not a party to NSW1. There is no expert evidence that the law of New South Wales is any different.

In all those circumstances, there can be no confidence that the arbitration provisions of clause 7 embrace any of the claims in NSW2.

I respectfully do not agree with the Judge’s conclusion that the claims assigned to MWP by the assignments are precluded by issue estoppel because they are based on the same issues concerning breach of contractual and fiduciary duties by Mr Emmott in relation to the diversion of clients and business from MWP to Temujin and the concealment of assets as were the subject of the arbitration. It is an essential requirement of issue estoppel that the parties or their “privies” in the earlier proceedings relied on as creating an estoppel, and those in the later action in which that estoppel is raised as a bar, must be the same: The Sennar (No 2) [1985] 1 WLR 490 at 499.

The Judge considered that the parties in the arbitration and in NSW2 are not different because MWP is entitled to assert the assigned claims, and does assert them, in its own name. As I have said earlier, however, the assignments do not transform the character of the assigned claims from being the claims of the assignors to being MWP’s claims in his own right. The assignors cannot be considered to be “privies” of MWP for the purpose of issue estoppel since they were not parties to the MWP Agreement or to the arbitration and they did not acquire their rights through MWP.

I turn next to the Judge’s finding that NSW2 amounts to an abuse of process since there has been a final and binding arbitration award and NSW2 is a collateral attack on it.

The expression "abuse of process" is likely to cause confusion in this context as the issue is not whether the present proceedings or any other pending proceedings in this jurisdiction are an abuse of process and it is a matter for the Australian courts to decide what is or is not an abuse of their process. We have no evidence on that matter.

The issue is rather whether the court in this jurisdiction, as the judicial guardian of the integrity of an arbitral process in London pursuant to an arbitration agreement subject to the laws of England and Wales, ought to exercise its discretion in favour of an anti-suit injunction because NSW2 is vexatious and oppressive in undermining that arbitration agreement and arbitration process.

NWS2 plainly is, in part, vexatious and oppressive on that approach. In NSW1 MWP succeeded on some diversion allegations which it had decided not to advance in the arbitration and on some others which it lost in the arbitration. It had, for example, originally advanced but then dropped claims for fraud and conspiracy. It is not in dispute that it lost in the arbitration on claims relating to Project X, Eragon and ADA and Benkala Copper but succeeded on all of them in NSW1. It is in dispute whether or not it lost in the arbitration on its claims relating to Chilisai (lost fees), Chilisai (success fees), Urals Gold and Roxi but we do not have to decide that issue now.

Furthermore, it is clear from the evidence before us that, if free to do so, MWP will seek in NSW2 to challenge adverse findings in the arbitration on the grounds that there was inadequate disclosure of written material, that fraudulent evidence was given by and on behalf of Mr Emmott and that the evidence was incomplete.

It would be oppressive and vexatious, and highly unjust, in the light of the arbitration provisions in the MWP Agreement and the elaborate and extremely lengthy arbitration with Mr Emmott over eight years, for MWP, on the basis of joint and several liability, to be able to recover compensation from Mr Emmott in NWS2 on the basis of claims on which it lost and other findings which were adverse to it in the arbitration or which it made a conscious decision not to advance. I entirely agree with the Judge to that extent.

Such oppression and injustice do not, however, extend to the Temujin partnership claims. It is clear that the arbitrators envisaged that the Australian courts, rather than the arbitrators, would decide whether or not Mr Emmott was a partner with Mr Nicholls and Mr Slater in the Temujin business and, if he was, would determine what would be Mr Emmott's liability in his capacity as a partner. In paragraph 4.144(s) of the SIA, for example, the arbitrators said, in relation to "Pinegrove/Roxi":

"We have read the judgment of Justice Einstein in the Supreme Court of New South Wales of 6 October 2008. Whilst that judgment is not binding upon us, and we understand is under appeal, in light of the remedies awarded in that judgment against Temujin in respect to the diversion work, we make no separate award in respect to this part of the claim. If Mr Emmott is a partner in Temujin, he and Temujin will be liable to account in those proceedings but not before us."

In the section of the SIA on "Remedies" the arbitrators said at paragraph 8.22:

"Temujin has been found liable in damages by the Australian Court, and if Mr Emmott is a partner in that firm (as to which we have insufficient evidence to form an opinion) he will be jointly and severally liable for Temujin's debts".

It will be a matter for the Australian courts to decide in NSW2 whether or not it would be an abuse or unjust or unconscionable for MWP to recover, by means of the assigned rights of Mr Nicholls and Mr Slater in respect of the Temujin partnership claims, a contribution to damages or equitable compensation owed by Temujin to MWP under NSW1 insofar as such damages and compensation are based on matters consciously not advanced by MWP in the arbitration or on which it lost in the arbitration or for which Mr Emmott has already compensated MWP pursuant to the SIA and the TQA.

It would also be a matter for the Australian courts to decide whether, as was contended on behalf of Mr Emmott, there is no relevant connection between New South Wales and the Temujin partnership claims and, if so, whether that \carries any consequences as to the jurisdiction of New South Wales.

At one point in the course of his oral submissions Mr Philip Shepherd QC, for Mr Emmott, submitted that any permission for MWP to continue NSW2 should be made conditional on MWP paying Mr Emmott or paying into court the sums due to Mr Emmott pursuant to the arbitration. Leaving aside MWP’s (hotly contested) assertion that Mr Emmott owes MWP at least as much, it would be quite wrong in principle to make payment by MWP to Mr Emmott or payment into court by MWP a condition of the exercise of MWP’s right to continue with the Temujin partnership claims which do not fall within the arbitration clauses of either the MWP Agreement or the Co-operation Agreement and which were not determined in the arbitration and are not oppressive or vexatious or a collateral attack on the arbitration.

During the course of the hearing before us, Mr Brian Doctor QC, for MWP, informed us that he was authorised to offer the following undertaking:

"MWP undertakes that in the Australian proceedings between MWP and Mr Emmott, insofar as MWP as assignee of the claims there set out seeks a contribution from Mr Emmott as joint and several wrongdoer, to the liability of the assignors to MWP, it will not seeks to overturn any of the findings made against MWP in the arbitration between Mr Emmott and MWP. This undertaking does not affect the claim by MWP as assignee of the partnership claims by Slater and Nicholls against their partner Emmott, if he is found to be one."

That undertaking is insufficient in so far as it does not preclude MWP advancing a claim which was consciously not advanced by it in the arbitration, in particular the claims for fraud and conspiracy, which were dropped. Mr Doctor subsequently informed us that he was authorised to extend the undertaking to preclude any claims which could have been but were not advanced in the arbitration.

The undertaking is also deficient insofar as it does not make clear that the Australian courts will be free to decide whether or not it would be an abuse or unconscionable or unjust for MWP to advance a Temujin partnership claim to the extent mentioned in paragraph 61 above.

MWP is a BVI company with, we were told, no assets or presence in this jurisdiction. It was not a ground of appeal, and no argument was advanced before us, that an injunction could not or should not be granted for that reason. Those facts do, however, seem to me to make it preferable to grant an injunction rather than accept an undertaking.

I have no hesitation in rejecting the ground of appeal that the Judge failed to give any or any adequate reasons for her findings. Although I do not agree with several of her findings, the Judge's reasoning is perfectly clear and adequate throughout.

I would refuse permission to appeal the Judge's finding that, when issuing NSW2, MWP had dishonestly misrepresented that Mr Emmott was domiciled and resident in New South Wales. The application is made too late, is irrelevant to the reasons I have given as to whether or not an injunction should be granted and its scope, and is a matter that is more suitable for the Australian courts to resolve.

For the reasons I have given, I would allow the appeal to the extent of substituting, in place of the injunction granted by the Judge, an injunction against MWP advancing in NSW2 (1) claims which it lost in the arbitration; (2) matters contrary to findings in the arbitration which were adverse to MWP; and (3) claims for fraud or conspiracy. The injunction would not extend to the Temujin partnership claims. It would, however, be a matter for the Australian courts to decide in NSW2 whether or not it would be an abuse or unjust or unconscionable for MWP to recover, through the Temujin partnership claims, a contribution to damages or equitable compensation owed by Temujin to MWP under NSW1 insofar as such damages and compensation were based on claims which MWP lost in the arbitration or on other findings in the arbitration which were adverse to MWP or are claims for which Mr Emmott has already compensated MWP pursuant to the SIA and the TQA.

I agree.

I also agree.