Anti-Suit Injunctions: A Brief Judicial Overview

by Amrutha Alapati†

   

Introduction: What are anti-suit injunctions

An anti-suit injunction is an injunction ordering a party either not to commence or not to take any further steps in proceedings in another jurisdiction. When a court restrains a party to a suit or proceeding before it from instituting or prosecuting a case in another court including a foreign court, it is called anti-suit injunction.1

Anti-suit injunctions are often the result of disputes regarding the proper jurisdiction i.e. court of a country to decide the dispute. They have become increasingly common, largely due to the application of foreign law to contracts, arbitration clauses and their resulting disputes. In fact, the law of anti-suit injunction has developed to such an extent that it gave birth to the concept of anti-anti-suit injunctions, also known as anti-enforcement injunctions.

What have foreign courts held on anti-suit injunctions

United Kingdom

The first requirement for the granting of an anti-suit injunction is that the English court has jurisdiction over the respondent: relief will not be granted against a respondent upon whom valid service cannot be affected.2

The House of Lords in Carron Iron Co. Proprietors v. Maclaren3 issued anti-suit injunctions on the principle of “equity and good conscience”. The courts in UK later held in favour of anti-suit injunctions “to avoid injustice”4. The test later adopted was whether the foreign proceedings are “oppressive or vexatious”.5

These tests were laid down in cases where there was multiplicity of proceedings that were deemed to be vexatious. However, in cases where the anti-suit injunction was sought because another forum was argued as more favourable, the House of Lords abolished these tests.6 This was because of the moral connotations of the word “vexatious” and the defendant's difficulty to prove any malicious intent of the plaintiff.

In Société Nationale Industrielle Aerospatiale v. Lee KuiJak,7 the Privy Council laid down the principles to be applied by a court in deciding whether to restrain foreign proceeding. It held that the plaintiff will only be restrained from pursuing the foreign proceedings if it would be vexatious or oppressive for him to do so.

The next test was to check if the anti-suit injunction was necessary to meet the “ends of justice”. English courts were inclined to grant anti-suit injunctions if they thought that it would meet the “ends of justice”8.

In Spiliada Maritime Corpn. v. Cansulex Ltd.,9 the House of Lords laid down that the fundamental principle in these cases is that the court would choose that forum in which the case could be tried more suitably for the interests of all the parties and for the ends of justice. Such a forum would be one with which the action had the most real and substantial connection in terms of:

  1. convenience or expense;

  2. availability of witnesses;

  3. the law governing the relevant transaction; and

  4. the places where the parties resided or carried on business.

In Airbus Industries,10 the House of Lords identified two underlying aspects to grant an anti-suit injunction. The first is the requirement to meet the ends of justice and the second is respect for other court's jurisdiction i.e. the principle of comity in international law.

Hereafter, the English courts also highlighted the situations in which they would not be inclined to grant anti-suit injunctions. In Donohue v. Armco Inc.,11 the Court held that it might decline to grant an injunction where: (1) the interests of non-signatories were involved; or (2) there were claims in the dispute that were not contained in the exclusive jurisdiction clause. The rationale for that was to prevent the risk of parallel proceedings and inconsistent decisions.

In one of the most recent cases on anti-suit injunctions, the England and Wales High Court in IPCom GmbH & Co. KG v. Lenovo Technology (United Kingdom) Ltd.12 applied the test of “oppressive and vexatious” suit and observed that “the less that an anti-anti-suit injunction granted in England would interfere with the foreign proceedings to which it was directed, the more likely it was that the court would exercise its discretion to grant such an injunction”.

Therefore, as a general rule, the English courts will not grant an anti-suit injunction if, by doing so, it will unjustly deprive the plaintiff of advantages in the foreign forums.13

Australia

The main modern authority for anti-suit injunctions in Australia is CSR Ltd. v. Cigna Insurance Australia Ltd.14 and National Mutual Holdings Pty. Ltd. v. Sentry Corpn.15 The Australian court used the test “to meet the ends of justice” in the sense that “only if there is nothing which can be gained by them over and above what may be gained in local proceedings”.

The Australian courts have adhered to a liberal attitude to granting the anti-suit injunction consistently shown in the English authorities. In CSR Ltd.,16 the court in its survey of the principles governing the grant of anti-suit injunctions cited The Angelic Grace17 as an authority where proceedings in a foreign jurisdiction are restrained by reason of agreement to submit to arbitration in the forum.

Additionally, the Australian courts18 have applied the doctrine of forum non conveniens, which requires a court of the forum to decline to exercise its jurisdiction where the forum is a clearly an inappropriate forum for an action.19

Canada

The Supreme Court of Canada adopted the “the ends of justice” test. It held that the court must enquire how best the interests of justice will be served and whether the anti-suit injunction is necessary in the interests of justice. It also discussed the “oppressive and vexatious” test to hold that where a jurisdiction agreement exists it is not necessary to show that foreign proceedings are vexatious, oppressive or that the local court is a natural forum for the claim and there is no obligation upon the claimant to seek relief from a foreign court first.20

In a novel decision, British Columbia's Court of Appeal in Li v. Rao,21 upheld an anti-suit injunction preventing a party from taking further steps in a pending arbitration administered beyond the court's jurisdiction.

The Court identified the general principles applicable to anti-suit injunctions and referred to Workers’ Compensation Board v. Amchem Products Inc.22 It underlined the two-stage test for issuing an anti-suit injunction i.e. to apply the principles of comity and analyse the contractual terms existing between the parties.23

Prior to this case, no Canadian court had ever considered whether to grant an anti-suit injunction to enforce a forum selection agreement. They only granted anti-suit injunctions on the “interests of justice” test developed in Amchem.24 Thus, the court went on to apply the English Law on anti-suit injunctions and upheld the injunction “on a contractual basis”25 i.e. based on the contractual terms existing between the parties.26

What have Indian courts held on anti-suit injunctions

The first decision on anti-suit injunctions can be traced back to Oil and Natural Gas Commission v. Western Co. of North America.27 This is an important decision as it identifies situations in which allowing the proceedings in the foreign court to continue would be “oppressive”. The Supreme Court held that it would grant anti-suit injunctions in cases where:

  1. it was necessary or expedient to do so; or

  2. when the ends of justice so required;

  3. the High Court had undoubted jurisdiction to grant such an injunction; and

  4. it would be unfair to refuse the restraint order because the action in the foreign court would be oppressive.

The next judgment of the Supreme Court on this point is in British India Steam Navigation Co. Ltd. v. Shanmughavilas Cashew Industries28. In this case, the Court laid down the choice of law rule to determine which court had jurisdiction:

  1. The jurisdiction clause may provide for submission to the courts of a particular country or to a court identified by a formula.

  2. It is a question of interpretation, governed by the proper law of the contract, whether a jurisdiction clause is exclusive or non-exclusive, or whether the claim which is the subject-matter of the action falls within its terms.

  3. If there is no express choice of the proper law of the contract, the law of the country of the chosen court will usually, but not invariably, be the proper law.

The landmark judgment on anti-suit injunctions is that of Modi Entertainment Network v. WSG Cricket Pte. Ltd.29 For the first time, the Supreme Court discussed and outlined the principles for granting an anti-suit injunction.

It held that a court in India has the power to issue anti-suit injunction to a party over whom it has personal jurisdiction because Indian courts are courts of equity which exercise jurisdiction in personam. However, due to the principle of comity, this power will be exercised sparingly because such an anti-suit injunction in effect causes interference in the exercise of jurisdiction by another court.

The Court in Modi Entertainment Network v. WSG Cricket Pte. Ltd.30 laid down the following principles to be applied by courts to decide whether to grant an anti-suit injunction:

  1. In exercising discretion to grant an anti-suit injunction, the court must be satisfied that:

    (a) the defendant has consented to the jurisdiction of the court;

    (b) if the injunction is declined, the ends of justice will be defeated, and injustice will be perpetuated; and

    (c) the principle of comity i.e. respect for the court in which the commencement or continuance of action/proceeding is sought to be restrained must be borne in mind.

  2. The court will decide the appropriate forum (forum conveniens) based on the convenience of the parties and may grant anti-suit injunction against proceedings which are oppressive or vexatious or in a forum non conveniens.

  3. Where jurisdiction of a court is invoked on the basis of the jurisdiction clause in a contract, clauses regarding exclusive or non-exclusive jurisdiction of the court are not conclusive but are relevant factors. The court has to decide the appropriate forum based on a true interpretation of the contract and on the facts and circumstances.

  4. A court of natural jurisdiction will not normally grant anti-suit injunction against a defendant before it where the parties have agreed to submit to the exclusive jurisdiction of a court including a foreign court, a forum of their choice in regard to the commencement or continuance of proceedings in the court of choice, save in an exceptional case for good and sufficient reasons, with a view to prevent injustice in circumstances such as which permit a contracting party to be relieved of the burden of the contract; or since the date of the contract the circumstances or subsequent events have made it impossible for the party seeking injunction to prosecute the case in the court of its choice because the essence of the jurisdiction of the court does not exist or because of a vis major or force majeure and the like.

  5. Where the parties have agreed, under a non-exclusive jurisdiction clause, to approach a neutral foreign forum and be governed by the law applicable to it for the resolution of their disputes arising under the contract, ordinarily no anti-suit injunction will be granted in regard to proceedings in such a forum conveniens and favoured forum as it shall be presumed that the parties have thought over their convenience and all other relevant factors before submitting to non-exclusive jurisdiction of the court of their choice which cannot be treated just as an alternative forum.

  6. A party to the contract containing jurisdiction clause cannot normally be prevented from approaching the court of choice of the parties as it would amount to aiding breach of the contract; yet when one of the parties to the jurisdiction clause approaches the court of choice in which exclusive or non-exclusive jurisdiction is created, the proceedings in that court cannot per se be treated as vexatious or oppressive nor can the court be said to be forum non conveniens.

  7. The burden to prove that the forum of choice is a forum non conveniens or that the proceedings are “oppressive or vexatious” is on the party contending it.

Another landmark judgment of the Supreme Court, affirming Modi Entertainment Network v. WSG Cricket Pte. Ltd.31 is that of Dinesh Singh Thakur v. Sonal Thakur.32 The Supreme Court held that an anti-suit injunction can be granted if the continuation of the proceedings will result in grave injustice to either of the parties or defeat the ends of justice or perpetuate injustice.

Through these two cases, the position in Indian law is now established. The principles laid down in Modi Entertainment Network v. WSG Cricket Pte. Ltd.33 are now established law. In the latest slew of judgments on anti-suit injunctions, the Delhi High Court34 has explained the different types of injunctions in disputes regarding the appropriate forum:

  1. Anti-suit injunctions: In which the court injuncts the party from proceeding with the main suit, pending before the foreign court.

  2. Anti-anti-suit injunctions: Where the court injuncts the party from proceeding with the anti-suit injunction application filed before the foreign court to injunct the “local” proceedings.

  3. Anti-enforcement injunctions: Where the court injuncts one of the parties before it from enforcing, against the other, a decree or order passed by a foreign court. They would also fall in two categories. The first, where the order, the enforcement of which is sought to be injuncted, is an order in the main suit/complaint/other proceeding in the foreign court. The second, where injunction is sought of an anti-suit injunction order passed by the foreign court.35

Another Delhi High Court judgment36 has laid down the circumstances in which an Indian citizen can shield himself against the effect of proceedings pending before a foreign court:

  1. Under Section 1337 CPC, through anti-enforcement proceedings; and

  2. Though anti-suit injunctions.

The Court summarised the Indian law on the point, as evolved by primarily the Supreme Court. In India, the grant of such anti-suit injunctions is restricted to cases where the foreign proceedings are “oppressive or vexatious”, keeping in mind the overarching need to ensure the “interests of justice”. It held that the judgments of the Supreme Court, which pronounced the position of anti-suit injunctions, are Oil and Natural Gas Commission v. Western Co. of North America38, Modi Entertainment Network v. WSG Cricket Pte. Ltd.39 and Dinesh Singh Thakur v. Sonal Thakur.40

Subsequent Bombay41 and Gujarat High Court42 judgments went on to follow the position laid down in Modi Entertainment Network v. WSG Cricket Pte. Ltd.43 and Dinesh Singh Thakur v. Sonal Thakur44 and restated the principles as follows:

(a)The principles governing the grant of injunction, are also applicable to the grant of anti-suit injunction.

(b) The grant of injunction is essentially guided by equity.

(c) The power to grant anti-suit injunction is required to be exercised sparingly “because such an injunction though directed against a person, in effect causes interference in the exercise of jurisdiction by another court”. This aspect is underscored where the order would restrain the parties from instituting or continuing a case in a foreign court.

(d) The anti-suit injunction cannot be granted, where any of the inhibiting factors, enumerated in Section 41 of the Specific Relief Act, 1963, applies.

(e) The injuncted defendant must be amenable to the jurisdiction of the Indian court granting anti-suit injunction.

(f) Declining of an anti-suit injunction would result in defeating the ends of justice and would perpetuate injustice.

(g) While granting anti-suit injunctions, the principle of comity of courts is required to be borne in mind45.

The response to anti-suit injunctions: Anti-anti-suit injunctions

The authority of the Indian courts to grant anti-anti-suit injunctions was first examined and upheld by the Calcutta High Court in Devi Resources Ltd. v. Ambo Exports Ltd.46 The Court recognised its competence under the general principle of equitable jurisdiction and held that the authority to grant an injunction “also encompasses the authority to grant an anti-suit or anti-arbitration injunction or even an anti-anti-suit injunction”. However, it limited this authority by stating that it “is issued only in the most extreme of cases where the refusal of the injunction may result in palpable and gross injustice in the meanest sense”.47

The first Indian case in which an anti-anti-suit injunction was passed was in Interdigital Technology Corpn. v. Xiaomi Corpn.48 The Delhi High Court applied the troika test of prima facie case, balance of convenience and irreparable loss to find that enforcement of the anti-suit injunction would render Interdigital remediless against patent infringement. In a first of its kind, the Indian court allowed the anti-anti-suit injunction i.e. anti-enforcement application.49

Therefore, the door is now open for the disputing parties to apply for anti-anti-suit injunctions provided that they are able to meet the admittedly high threshold of injustice, irreparable loss, oppression, or vexation.


† 4th year BBA LLB (Hons.) Student, Symbiosis Law School, Pune. The author can be reached at alps7016@gmail.com.

1. Modi Entertainment Network v. WSG Cricket Pte. Ltd., (2003) 4 SCC 341.

2. Airbus Industrie GIE v. Patel, (1999) 1 AC 119 : (1998) 2 WLR 686 : (1998) 2 All ER 257.

3. (1855) 5 HLC 416.

4. Castanho v. Brown and Root (UK) Ltd., 1981 AC 557.

5. Société Nationale Industrielle Aerospatiale v. Lee Kui Jak, 1987 AC 871 : (1987) 3 WLR 59 : (1987) 3 All ER 510.

6. Rockware Glass Ltd. v. Macshannon, (1978) AC 795 : (1978) 2 WLR 362 : (1978) 1 All ER 625.

7. 1987 AC 871 : (1987) 3 WLR 59 : (1987) 3 All ER 510.

8. Airbus Industrie GIE v. Patel, (1999) 1 AC 119 : (1998) 2 WLR 686 : (1998) 2 All ER 257; Workers’ Compensation Board v. Amchem Products Inc., 1993 SCC OnLine Can SC 37 : (1993) 1 SCR 897.

9. 1987 AC 460 : (1986) 3 WLR 972.

10. Airbus Industries GIE v. Patel, (1999) 1 AC 119 : (1998) 2 WLR 686 : (1998) 2 All ER 257; Geoffrey Fisher (2010) “Anti-suit Injunctions to Restrain Foreign Proceedings in Breach of an Arbitration Agreement,” Bond Law Review: Vol. 22: Issue 1, Article 1, <http://epublications.bond.edu.au/blr/vol22/iss1/1>.

11. (2002)1 All ER 749 (HL), referred to in Modi Entertainment Network v. WSG Cricket Pte. Ltd., (2003) 4 SCC 341.

12. 2019 EWHC 3030; Interdigital Technology Corpn. v. Xiaomi Corpn., 2021 SCC OnLine Del 2424.

13. Charles Dougherty and Alistair Mackenzie, “A Practical Guide from the Commercial Dispute Resolution Group”, 2 Temple Gardens, (2016), <2016.06.15-A_Practical_Guide_to_Anti-Suit_Injunctions_-_Summer_2016.pdf (2tg.co.uk)>.

14. (1997) 189 CLR 345.

15. (1989) 87 ALR 539; Horlicks Ltd. v. Heinz India (P) Ltd., 2009 SCC OnLine Del 3342.

16. (1997) 189 CLR 345.

17. Aggeliki Charis Compania Maritima SA v. Pagnan SpA (The Angelic Grace), (1995) 1 Lloyd's Rep 87.

18. Voth v. Manildra Flour Mills Pty. Ltd., (1990) 171 CLR 538.

19. Michael Douglas, “Anti-Suit Injunctions in Australia”, (2017) 41(1) Melbourne University Law Review (Advance), <https://ssrn.com/abstract=3019622>.

20. Modi Entertainment Network v. WSG Cricket Pte. Ltd., (2003) 4 SCC 341.

21. Peipei Li v. Luhua Rao, 2019 BCCA 264, appealed from an order of the Supreme Court of British Columbia dated 12-1-2018 in Li v. Rao, 2018 BCSC 47.

22. 1993 SCC OnLine Can SC 37.

23. Michael Douglas, “Anti-Suit Injunctions in Australia”, (2017) 41(1) Melbourne University Law Review (Advance), <https://ssrn.com/abstract=3019622>.

24. Workers’ Compensation Board v. Amchem Products Inc., 1993 SCC OnLine Can SC 37.

25. Daniel Urbas, “B.C. — Anti-Suit Injunction Based on Contract Enjoins Party from Pursuing Arbitration Administered Outside Canada”, #235, Urbas Arbitral, <https://urbas.ca/?p=1381>.

26. Geoffrey Fisher, “Anti-Suit Injunctions to Restrain Foreign Proceedings in Breach of an Arbitration Agreement”, Bond Law Review, 22(1), Art. 1, (2010),

<https://www.austlii.edu.au/au/journals/BondLawRw/2010/1.pdf>.

27. (1987) 1 SCC 496.

28. (1990) 3 SCC 481.

29. (2003) 4 SCC 341.

30. (2003) 4 SCC 341.

31. (2003) 4 SCC 341.

32. (2018) 17 SCC 12.

33. (2003) 4 SCC 341.

34. Interdigital Technology Corpn. v. Xiaomi Corpn., 2021 SCC OnLine Del 2424.

35. Vijay Pal Dalmia, “Anti-Suit Injunctions—When and How Granted in India”, Mondaq, (4-7-2018),

<https://www.mondaq.com/india/contracts-and-commercial-law/715482/anti-suit-injunctions-when-and-how-granted-in-india>.

36. Raaj Unocal Lubricants Ltd. v. Apple Energy (P) Ltd., 2021 SCC OnLine Del 2395.

37. Civil Procedure Code, 1908, S. 13.

38. (1987) 1 SCC 496.

39. (2003) 4 SCC 341.

40. (2018) 17 SCC 12.

41. Milind Ashok Kalamkar v. Sheetal Milind Kalamkar, 2021 SCC OnLine Bom 2370.

42. Mashreq Bank PSC v. Indian Overseas Bank, 2021 SCC OnLine Guj 2678.

43. (2003) 4 SCC 341.

44. (2018) 17 SCC 12.

45. Vasanth Rajasekaran and Nayantara Narayan, “Enforcement of Anti-Suit Injunction: Indian Court Lays Down the Parameters for Grant of Anti-enforcement Injunction Against an Order by a Foreign Court”, Mondaq, (27-5-2021), <https://www.mondaq.com/india/patent/1073034/enforcement-of-anti-suit-injunction-indian-court-lays-down-the-parameters-for-grant-of-anti-enforcement-injunction-against-an-order-by-a-foreign-court>.

46. 2019 SCC OnLine Cal 7774.

47. 2019 SCC OnLine Cal 7774; Dishti Titus, “Outstretching Across Borders: Anti-Suit Injunctions in India”, ALG India Law Offices LLP, (28-7-2020), <https://www.algindia.com/outstretching-across-borders-anti-suit-injunctions-in-india/>.

48. 2021 SCC OnLine Del 2424.

49. Candice Lin, “Indian High Court rules in country's first anti-anti-suit-injunction”, Asia Law, (10-5-2021), <https://www.asialaw.com/NewsAndAnalysis/indian-high-court-rules-in-countrys-first-anti-anti-suit-injunction/Index/907>; Tulip De and Priya Adlakha, “The Law of Anti-suit Injunctions in India”, Litigation Committee Newsletter Article, International Bar Association, April 2020,

<https://www.ibanet.org/article/40B35B14-9403-412F-9A6C-6E03080BF696>.

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