Kamoto Copper Company SA v (1) Africa Horizons Investments Ltd and (2) Ventora Development SASU [2018] EWHC 1086 (Comm)
Mr Justice Males ordered an anti-suit injunction against the defendant companies on the claimant’s application after the second defendant commenced proceedings in the DRC claiming US$2.857 billion in relation to the alleged assignment of a royalties agreement.
The claimant and the first defendant were parties to an agreement under which the claimant agreed to pay the first defendant royalties relating to the mining of copper and cobalt deposits in the DRC. Those royalties were to be denominated in US dollars. The agreement provided for English law and exclusive jurisdiction (including in relation to non-contractual disputes).
The second defendant’s position was that the benefit of the agreement had been assigned to it by the first defendant.
On 20 December 2017, President Trump issued an executive order (no 13818), entitled “Blocking the property of persons involved in serious human rights abuses or corruption)”. Pursuant to that order, both Mr Dan Gertler (the principal behind both defendants) and the first defendant had been designated as “specially designated nationals”, with the result that no US person was permitted to provide any funds or services to or for the benefit of either of them or to companies under their majority ownership or control.
The claimant’s position was that no royalty payments had yet fallen due but that it would not in the future be able to make royalty payments to the first defendant in US dollars because those payments would require the involvement of a Federal Reserve Bank in the US. In respect of the second defendant, the claimant’s position was that there had been no valid assignment of the first defendant’s rights but if the second defendant was entitled to receive any royalty payments under the agreement, the effect of the executive order was that payments could not be made to it if it was relevantly affiliated with a designated person.
On 26 April 2018, the second defendant commenced proceedings in the DRC and obtained an order attaching the claimant’s assets. On 27 April 2018, the second defendant commenced further proceedings obtaining an order against the claimant for payment of the total sum of US$2.857 billion. That order would become a final and enforceable judgment if the claimant did not file an opposition in the DRC within 15 days of service of the order upon it.
Males J held that, viewed together, at least on the material before the court, the proceedings were contrary to the terms of the jurisdiction clause in the parties’ agreement. They were not simply precautionary measures but were all part and parcel of an attempt to litigate the merits in the DRC.
Even if there had been a valid assignment to the second defendant, it was clear that the second defendant was bound by the jurisdiction clause. It was claiming royalties under the agreement and claimed to be the assignee of the agreement: The Jay Bola [1997] 2 Lloyd’s Reports 279.
It was therefore appropriate to grant an injunction restraining the second defendant from taking further steps in the DRC proceedings and restraining both defendants from commencing or pursuing any other substantive claim other than in England or another member state of the European Union or the Lugano Convention.
A copy of the Judgment can be viewed here.
Camilla Bingham QC and Sam O’Leary appeared for the claimant and Richard Gillis QC appeared for the second defendant.