BBJ STEEL LIMITED vs CARGILL INTERNATIONAL TRADING PTE — 2025 CLD 1702 LAHORE-HIGH-COURT-LAHORE

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BBJ STEEL LIMITED VS CARGILL INTERNATIONAL TRADING PTE. LTD. Ss.6, 7& 8---Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 1958, ("the New York Convention") Article-V---Recognition and enforcement of foreign arbitral awards---Limited grounds for refusal---Scope and limitations explained---Overriding effect of New York Convention stated in case of inconsistency between the Act, 2011 and New York Convention---The issue for determination before the High Court in the present intra-court appeal was as to "whether a foreign arbitral award rendered by the Singapore International Arbitration Centre (SIAC) could be recognized and enforced in Pakistan under the Recognition and Enforcement (Arbitration Agreements and Foreign Arbitral Awards) Act, 2011?"---The appellant challenged the enforcement of arbitral award on grounds that the underlying contract between the parties was signed by unauthorized person on its behalf and that the arbitral award suffered from legal and factual errors---Held: Plea of the appellant company that contract was signed by unauthorized person was misconceived because the contract was signed by agent of the appellant company who acted upon appellant company's behalf with its permission and consent and no action against him was stated to have been taken by the appellant company; moreover, the address of the appellant company and that of the agent/signatory was also the same which further supported that the agent was acting on behalf of the appellant company---With respect to the alleged legal factual errors averred by the appellant company High Court emphasized upon and took note of the fact that the appellant company had replied to a legal notice but not opted to appear and join the arbitration proceedings which showed that the appellant company intentionally avoided the proceedings of arbitration---Refusing to accept the arbitrator's authority and not taking part in the arbitration proceedings did not release the appellant from the duties and responsibilities under the sales contract---Even if there were any mistakes or illegalities in the decision of arbitrator, same did not fall under Article-V of the New York Convention---Under S. 7 of the Act, 2011, only the reasons listed in Article-V of the New York Convention could be used to refuse enforcement of a foreign award---Section 6 of the Act, 2011 also confirmed that only those reasons mentioned in S. 7 of the Act, 2011, which was Article-V of the New York Convention, were valid grounds for refusal for recognition and enforcement of a foreign arbitral award---This showed that the law allowed very limited scope for rejecting a foreign arbitration award---The argument of the appellant company that the arbitrator while giving its award made legal or factual errors was not a valid reason under Article-V of the New York Convention, so this defense was not available to the appellant---Recognition and enforcement of a foreign arbitral award could only be refused by a Pakistani Court if the award seriously violated the basic notions of morality and justice prevailing in Pakistan which was not the case of the appellant---Pakistan had been a signatory to the New York Convention and the country had promulgated the Act, 2011 to implement it---Section 8 of the Act, 2011 provided that in the event of any inconsistency between this Act and the convention (New York Convention), the convention was to prevail to the extent of the inconsistency---Appellant-company failed to point out any jurisdictional error in the judgment of the Single Judge in Chamber or in the award in the light of the Act, 2011 and New York Convention---For the foregoing reasons, no ground was made out for interference in the judgment impugned---Therefore, the present intra-court appeal being without substance was dismissed, in circumstances.

BBJ STEEL LIMITED vs CARGILL INTERNATIONAL TRADING PTE — 2025 CLD 1702 LAHORE-HIGH-COURT-LAHORE

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