The London Court of Appeal on Thursday rejected an appeal by Spain to enforce in England a Spanish ruling that forced the insurer of the wrecked oil tanker Prestige to pay 855 million euros for the environmental catastrophe caused by its sinking in 2002.
This court upheld a 2023 decision by High Court Justice Christopher Butcher who found that a March 1, 2019 ruling by the Provincial Court of La Coruña, which found London Steam-Ship Owners’ Mutual, could not be registered in English jurisdiction. Insurance Association Limited responsible for compensating the State for the toxic spill on the coast of Galicia.
The three judges of the Court of Appeal agreed with their colleague that the prior existence of an arbitration award issued on February 13, 2013 by lawyer Alastair Schaff, which exonerated the British insurer from paying by enforcing two key clauses of its contract with the ship’s owners, prevented the registration of that opinion.
The key to a very complex failure
As noted in Thursday’s ruling, the first of these clauses required the parties to arbitrate in London and the second provided that the mutual company, known in this process as ‘The Club’, “would only be responsible for paying if the owners “They did it first with their own money.”
The magistrates, however, rejected one of the arguments presented by the Club, which argued that a decision related to the case analyzed in 2020, before Brexit, and issued in 2022 by the Court of Justice of the European Union was not applicable in English territory ( EU).
The Court of Appeal also concluded this Thursday, in favor of Spain, that, as a result of sovereign immunity, neither the Spanish State nor France can be required to offer compensation to the insurer for having breached “the equitable obligation of arbitration “in England.
The Prestige, flagged in the Bahamas, broke up while carrying 70,000 tons of heavy fuel oil, causing damage on the northern coast of Spain and the western coast of France, which opened a long judicial dispute between these countries and the insurer in several jurisdictions.
The Club clung at all times to the fact that its contract with the ship’s owners established that any dispute would be settled through arbitration in the United Kingdom.
