LLC AGRONEFTEPRODUKT V AMEROPA AG

[2021] EWHC 3474 (Comm), Queen’s Bench Division, Commercial Court, Sir William Blair sitting as a High Court Judge, 21 December 2021

Arbitration – Jurisdiction – Validity of Notice of Arbitration – Rectification – Estoppel – Arbitration Act 1996, sections 14(4) and 67

By two separate contracts in June and July 2018 the claimant, LLC Agronefteprodukt (the “Sellers”), agreed to sell two consignments of wheat on FOB terms. The contracts contained identical GAFTA arbitration clauses. Disputes arose and on 30 August 2018 the defendant, Ameropa AG (the “Buyers”), sent a Notice of Arbitration referring to the two contracts and appointing a named arbitrator for the disputes under them. The Notice then proposed that the two contracts be adjudicated in a single arbitration. The Sellers did not respond. GAFTA appointed an arbitrator on behalf of the Sellers. The parties then entered into a settlement Washout Agreement in November 2018 under which the Buyers’ claim was reduced to US$1.1 million on condition that it was paid punctually. However, no payment was made and in February 2019 the Buyers terminated the Washout Agreement and continued the arbitration. The Sellers’ objected to jurisdiction on the ground that separate Notices of Arbitration were required for the two contracts. The GAFTA Tribunal and the GAFTA Board of Appeal dismissed the objection. The Sellers appealed under section 67 of the Arbitration Act 1996.