Manta Penyez Shipping Inc v Zuhoor Alsaeed Foodstuff Company involved a dispute over breaches of jurisdictional agreements. The claimants sought to restrain the defendant from pursuing three sets of legal proceedings in Yemen, which violated the parties’ contractual agreements governed by English law.

Granting interim mandatory anti-suit injunctions, the court emphasised the importance of upholding jurisdictional agreements, which it readily underscored with award of indemnity costs.

Key Issues:

The claimants argued that Yemeni proceedings - arrest proceedings and substantive claims filed in November 2024 - violated a guarantee dated 11 September 2024 (with an express covenant against such actions) and a charterparty dated 10 May 10 2024 (containing an LMAA arbitration clause requiring disputes to be resolved in London). The claimants contended the Yemeni proceedings constituted blatant jurisdictional violations.

Court’s Decision:

The High Court granted interim mandatory anti-suit injunctions - ordering the defendant to withdraw the proceedings in Yemen - and made an order for indemnity costs in favour of the claimants. The reasoning emphasised the importance of upholding jurisdictional agreements as well as the foreseeability of costs arising from their breach.

Indemnity Costs – Key Reasons:

  1. Protection of Jurisdictional Agreements: The court highlighted the importance of enforcing contractual commitments to jurisdiction and arbitration, labeling them essential for certainty in international commercial agreements. The award of indemnity costs was warranted to mark the gravity of such violations.
  2. Foreseeability of Costs: The defendant, having agreed to exclusive jurisdiction under English law, could reasonably foresee that violations would compel the claimants to incur legal expenses.
  3. Compensation for Legal Expenditure: Indemnity costs were awarded to approximate the damages claimants would have been entitled to recover. The indemnity costs aware ensures that claimants are reimbursed - to the fullest degree - for expenses incurred due to the breach.
  4. Institutional Policy: The court emphasised that indemnity costs reflect the legal system’s institutional commitment to protecting jurisdictional promises, and the consequent need to deter jurisdictional violations.

Manta Penyez Shipping Inc v Zuhoor Alsaeed Foodstuff Company involved a dispute over breaches of jurisdictional agreements. The claimants sought to restrain the defendant from pursuing three sets of legal proceedings in Yemen, which violated the parties’ contractual agreements governed by English law.

Granting interim mandatory anti-suit injunctions, the court emphasised the importance of upholding jurisdictional agreements, which it readily underscored with award of indemnity costs.

Key Issues:

The claimants argued that Yemeni proceedings - arrest proceedings and substantive claims filed in November 2024 - violated a guarantee dated 11 September 2024 (with an express covenant against such actions) and a charterparty dated 10 May 10 2024 (containing an LMAA arbitration clause requiring disputes to be resolved in London). The claimants contended the Yemeni proceedings constituted blatant jurisdictional violations.

Court’s Decision:

The High Court granted interim mandatory anti-suit injunctions - ordering the defendant to withdraw the proceedings in Yemen - and made an order for indemnity costs in favour of the claimants. The reasoning emphasised the importance of upholding jurisdictional agreements as well as the foreseeability of costs arising from their breach.

Indemnity Costs – Key Reasons:

  1. Protection of Jurisdictional Agreements: The court highlighted the importance of enforcing contractual commitments to jurisdiction and arbitration, labeling them essential for certainty in international commercial agreements. The award of indemnity costs was warranted to mark the gravity of such violations.
  2. Foreseeability of Costs: The defendant, having agreed to exclusive jurisdiction under English law, could reasonably foresee that violations would compel the claimants to incur legal expenses.
  3. Compensation for Legal Expenditure: Indemnity costs were awarded to approximate the damages claimants would have been entitled to recover. The indemnity costs aware ensures that claimants are reimbursed - to the fullest degree - for expenses incurred due to the breach.
  4. Institutional Policy: The court emphasised that indemnity costs reflect the legal system’s institutional commitment to protecting jurisdictional promises, and the consequent need to deter jurisdictional violations.