Alfred Uwe Maass v 1. Musion Events Ltd and Others
| Jurisdiction | England & Wales |
| Judge | Mr Justice Andrew Smith |
| Judgment Date | 18 May 2015 |
| Neutral Citation | [2015] EWHC 1346 (Comm) |
| Court | Queen's Bench Division (Commercial Court) |
| Docket Number | Case No: 2014-1279 |
| Date | 18 May 2015 |
[2015] EWHC 1346 (Comm)
IN THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
Royal Courts of Justice
Strand, London, WC2A 2LL
Mr Justice Andrew Smith
Case No: 2014-1279
Mr. Alexander Goold (instructed by Bracher Rawlins LLP) for the Claimant
Mr. Thomas Graham (instructed by DWFM Beckman) for the First and Second Defendants
Mr. Mark Deem (of Cooley (UK) LLP) for the Third Defendant
Hearing date: 6 May 2015
Approved Judgment
I direct that pursuant to CPR PD 39A para 6.1 no official shorthand note shall be taken of this Judgment and that copies of this version as handed down may be treated as authentic.
These proceedings arise from unfortunate confusion in the conduct of a London Court of International Arbitration ("LCIA") reference, and about the meaning and effect of an award made by the arbitrator, Mr Peter Thorp, which was dated 25 September 2014 and called "Final Award on Contractual Interpretation" (the "September award").
The subject matter of the underlying dispute is not important to what I have to decide, but I introduce it briefly. Mr Andrew Cromby, a partner in Bracher Rawlins LLP, the solicitors of the claimant, Mr Alfred Maass, described it in his witness statement as being about the proper interpretation of licences of intellectual property. I can convey the nature of the intellectual property by setting out this paragraph of the statement:
"The intellectual property in question consists of two principal patents, referred to as 'Pepper's Ghost 1' and 'Pepper's Ghost 2' that are the subject of various registrations around the world. As their name suggests, they are based on the Victorian stage illusion known as 'Pepper's Ghost' and involve methods for the projection of life-size 3D video images on a large scale. These are capable of seeming to appear on a stage and with which real people are able to appear to interact. Its applications are various, from entertainment to commercial product launches to politics. There is a valuable market for its exploitation world-wide."
The agreement from which the dispute arises, which has been referred to as the "Eyeliner Agreement", is in writing, dated 25 June 2007 and said to be "Heads of Agreement, Reorganisation of Eyeliner business". I can describe it further by setting out this paragraph of the first witness statement of Mr Sharokh Koussari, a partner in DWFM Beckman, the solicitors of the first and second defendants, Musion Events Ltd ("MEL") and Mr O'Connell:
"The Eyeliner Agreement of 25 June 2007 … is a bespoke commercial agreement between a number of related parties engaged in what is broadly speaking a rather involved form of business partnership (not using that expression in a technical sense). The Eyeliner Agreement is an exercise in the division of territories, income and intellectual property rights between business partners who had chosen to engage in business together but not to do so through a single corporate vehicle. The parties were instead engaged in business through different corporate vehicles, with different share ownerships, in different territories internationally, but making use of the same intellectual property rights (in particular patents) and using a key stock item (a polymer foil) which was subject to an exclusivity agreement with a third party manufacturer. The Eyeliner Agreement provides inter alia for the division of territories and income between the various parties and for the licensing of intellectual property rights between them. It is thus a commercial agreement which includes, inter alia, a number of licences of intellectual property licences [sic]."
In 2013 Mr Maass purported to terminate the Eyeliner Agreement by accepting its repudiatory breach. There is a dispute as to whether the agreement was effectively so terminated.
When the Eyeliner Agreement was made, its parties were (i) Musion Systems Ltd; (ii) "Eventworks" (an entity apparently associated with Mr Maass; (iii) Mr Maass; (iv) Mr Ian O'Connell, the second defendant in these proceedings; and (v) Mr James Rock, the third defendant. Mr O'Connell signed it in his own name and also above the words "Ratified for and on behalf of [MEL]", and both signatures are dated "25-06-07". MEL were not incorporated until 16 April 2008: the Eyeliner Agreement referred to an intention of Mr O'Connell and Mr Rock to incorporate a new company of that name, and they agreed to do so within three months. It was envisaged that MEL would then confirm or ratify the Eyeliner Agreement, but Mr Maass claims that MEL have produced no evidence of having done so. It was also envisaged that side agreements were to be made after MEL was incorporated but Mr Maass claims that none was. There is thus an issue whether MEL ever became party to Eyeliner Agreement and an arbitration agreement that it included, and about whether, if they did not, Mr Maass is nevertheless prevented by estoppel from disputing that they were parties to it.
The arbitration agreement in the Eyeliner Agreement was at paragraph 10.2. It was agreed that, unless settled by mediation, a dispute should "be referred to and finally resolved by arbitration under the LCIA Rules from time to time in force", that there should be one arbitrator, who should be "appointed by the LCIA without reference to the relevant parties to the dispute", and that the seat of the arbitration should be London. I should set out paragraphs 10.2(e), 10.2(g) and (in part) 10.2(h):
"(e) The arbitral proceedings shall be concluded within 3 months of the receipt by the LCIA registrar of the written request for arbitration, subject to the power of the arbitrator to extend this and other deadlines in the proceedings if, at his sole discretion, he considers it reasonable to do so".
"(g) To the extent permitted by law, the parties waive any right of recourse to national courts in order to challenge or appeal against any arbitral award".
(h) If a dispute arises under this Agreement or the Existing Agreements or any other agreement between the parties (which for the purposes of this clause, is deemed to include MEL and (MIP), then the arbitrator may consolidate those disputes in accordance with this clause 10.2."
("MIP" referred to another intended company that was not then incorporated.)
It is convenient next to refer to the relevant articles of the LCIA Rules:
i) Article 1.1 provides that "any party wishing to commence an arbitration under these Rules … shall send to the Registrar of the LCIA Court ("the Registrar") a written request for arbitration ("the Request"), containing or accompanied by [specified details]". Article 2 provides that within 30 days of the service of the request on him, the Respondent shall send the Registrar a written response to the Request ("the Response") containing specified details.
ii) Article 4.7 provides that:
"The Arbitral Tribunal may at any time extend (even where the period of time has expired) or abridge any period of time prescribed under these Rules or under the Arbitration Agreement for the conduct of the arbitration, including any notice or communication to be served by one party on any other party".
iii) Article 5 concerns the appointment of the tribunal, and I set out article 5.4:
"The LCIA Court shall appoint the Arbitral Tribunal as soon as practicable after receipt by the Registrar of the Response or after the expiry of 30 days following service of the Request upon the Respondent if no Response is received by the Registrar (or such lesser period fixed by the LCIA Court). The LCIA Court may proceed with the formation of the Arbitral Tribunal notwithstanding that the Request is incomplete or the Response is missing, late or incomplete. …".
iv) Article 23 provides that the Arbitral Tribunal "shall have the power to rule on its own jurisdiction".
v) Article 26 is about awards. Article 26.7 provides that, "The Arbitral Tribunal may make separate awards on different issues at different times. Such awards shall have the same status and effect as any other award made by the Arbitral Tribunal". Article 26.9 provides as follows:
"All awards shall be final and binding on the parties. By agreeing to arbitration under these Rules, the parties undertake to carry out any award immediately and without any delay (subject only to Article 27); and the parties also waive irrevocably their right to any form of appeal, review or recourse to any state court or other judicial authority, insofar as such waiver may be validly made."
vi) Article 27 is about the correction of awards and additional awards, and I set out articles 27.1 and 27.2:
"27.1 Within 30 days of receipt of any award, or such lesser period as may be agreed in writing by the parties, a party may by written notice to the Registrar (copied to all other parties) request the Arbitral Tribunal to correct in the award any errors in computation, clerical or typographical errors or any errors of a similar nature. If the Arbitral Tribunal considers the request to be justified, it shall make the corrections within 30 days of receipt of the request. Any correction shall take the form of separate memorandum dated and signed by the Arbitral Tribunal …; and such memorandum shall become part of the award for all purposes.
27.2 The Arbitral Tribunal may likewise correct any error of the nature describe in Article 27.1 on its own initiative within 30 days of the date of the award, to the same effect."
vii) Article 28 is about arbitration and legal costs, and article 28.3 provides as follows:
"The Arbitral Tribunal shall also have the power to order in its award that all or part of the legal or other costs incurred by a party be paid by another party, unless the parties agree otherwise...
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T v V and Others
...caused the tribunal to reach a decision which, but for that failure, it might not have reached (see per Andrew Smith J in Maass v Musion Events Limited & Ors. [2015] EWHC 1346 (Comm) at para. 40, Terna Bahrain Holding Company WLL v Al Shamsi & Ors. [2012] EWHC 3283 (Comm) at para.85(7)). (7......