Enron Metals and Commodity Ltd ((in Administration)) v HIH Casualty and General Insurance Ltd
| Jurisdiction | England & Wales |
| Judgment Date | 10 March 2005 |
| Neutral Citation | [2005] EWHC 485 (Ch) |
| Date | 10 March 2005 |
| Court | Chancery Division |
CHANCERY DIVISION
Before Mr Justice Pumfrey
Arbitration - stay of court proceedings - court can consider merits of claim sought to be arbitrated
The statutory discretion allowing proceedings to be commenced against a company in provisional liquidation extended to the assessment of the merits of a claim sought to be raised before arbitrators.
Mr Justice Pumfrey so held in the Chancery Division when dismissing the application of Enron Metals and Commodity Ltd (in administration), brought under section 130(2) of the Insolvency Act 1986, for leave to bring arbitration proceedings against HIH Casualty and General Ltd, a company in provisional liquidation.
Mr Matthew Hardwick for Enron Metals; Mr Jeremy Goldring for HIH Casualty.
MR JUSTICE PUMFREY said that the only issue he had to decide was whether the claim was so bad that it would be a waste of resources to allow it to proceed to arbitration.
The wide discretion conferred by section 130(2) extended to the assessment of the triability of a claim sought to be raised against a company regardless of the tribunal in which it would be heard.
After considering In re Hartlebury Printers LtdICR ((1992) ICR 559) andCapita Financial Group Ltd v Rothwells LtdUNK ((1989) 15 ACLR 348), his Lordship said if the claim sought to be raised did not satisfy the summary judgment test in Part 24 of the Civil Procedure Rules for a real issue to be tried, he should not contemplate granting leave under section 130(2) of the 1986 Act.
There was no justification for any lower test and, for that purpose, the fact that were HIH not in provisional...
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