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Grand Court rejects notion of “hybrid” orders and emphasises the finality principle

18 Nov 2021

In the long-running case of ArcelorMittal v Essar Global Fund Ltd & Anor the Grand Court has dismissed the Defendants’ application to set aside the Norwich Pharmacal order (NPO) made in 2019. The Defendants, having unsuccessfully challenged the NPO at first instance and on appeal, sought to set it aside on the grounds that subsequent commencement of a conspiracy claim in England and an avoidance action in New York, amounted to a material change of circumstance that rendered the NPO unnecessary.

The Judge held there were no grounds for setting aside the NPO, describing the application as a thinly veiled manifestation of the Defendants’ determination to frustrate the Plaintiff’s attempts to enforce the Award.” The narrow scope of the English/NY proceedings was not inconsistent with the purpose of the NPO – to assist the Plaintiff to obtain information about a debtor’s worldwide assets to enforce an unpaid arbitration award.

The judgment provides clear and authoritative guidance, that will be of interest in many common law jurisdictions as well as Cayman, on (i) whether a Norwich Pharmacal order is a final or interlocutory order, (ii) whether there exists a special category of ‘hybrid’ orders, and (iii) the test for setting aside a final order. Kawaley J held:

  • An NPO is a final order for the purposes of delineating the Court’s jurisdiction to revoke and vary orders by reason of subsequent developments.
  • The concept of a hybrid order is conceptually unsound; its status is necessarily fixed for appeal purposes as well as for the jurisdiction the Court retains to revoke or vary an order. There is no authority for the proposition that NPOs are a special category of order in relation to which the first instance court makes them as final orders but retains the same powers of review as with interlocutory orders (although the first instance court still has broad powers to supervise enforcement of a final order under Order 45, rule 11 of the GCR).
  • The Court’s power to set aside its own orders derives from its inherent jurisdiction. Aside from fraud, the sort of exceptional circumstances which would justify setting aside a final order made on an inter partes basis would have to be circumstances which, like fraud, undermine the basis upon which the order was made in a fundamental way.

This is a welcome ruling which not only brings this long running case a step closer to a conclusion but also provides helpful clarification on the nature of Norwich Pharmacal orders and their susceptibility to challenge.

Paul Smith, Anya Allen, and Rhiannon Zanetic continue to represent ArcelorMittal.

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