English court rejects arbitration challenge in A&N Seaways and Projects PVT Limited v Allianz Bulk Carriers

English court finds that a party did take part in the arbitration proceedings and, on that ground, dismisses the s.72 challenge to the Arbitral Award.

In the case A&N Seaways and Projects PVT Limited v Allianz Bulk Carriers DMCC [2025] EWHC 2126 (Comm) (Judgment of 13 August 2025), two main issues were considered by the English Commercial Court.

The first issue was whether the allegations of fraud in relation to the underlying contract – containing an arbitration agreement – were sufficiently pleaded and whether a late amendment to the Claim Form designed to introduce these allegations ought to be allowed.

The second issue was whether, on the unamended Claim Form, a party took part in the arbitration proceedings for the purposes of s.72 of the UK Arbitration Act 1996 (the “Act”).

Background

A&N Seaways and Projects PVT Limited, the Charterers, was the claimant, and Allianz Bulk Carriers DMCC, the Owners, the respondent in s.72 of the Act challenge to an arbitral award. The Owners, as the “disponent owners” of the MV “Bharadwaj” (the “Vessel”), time-trip chartered the Vessel to Charterers (the “Charterparty”) on 5 July 2023. The Charterparty was governed by English law and contained a London-seated arbitration clause. The Charterparty was concluded by one of two of the Charterers’ directors – Sashank Puria. The Charterparty was partially performed. Later, however, because of the Charterers’ non-payment, the Owners withdrew the Vessel and initiated the arbitration. The Charterers, in their defence, claimed that Mr Puria, having not obtained the Charterers’ board resolution, lacked authority to enter the Charterparty in the first place. The Charterers also claimed that the Charterparty was procured by Mr Puria by fraud, acting in concert with the Owners. As a result, it was argued that the Charterers were not even aware about the Charterparty, it had been procured by fraud, and the arbitration agreement contained therein was to be considered void.

Arbitration proceedings

The Charterers protested to the jurisdiction of the arbitral tribunal on the theory that the arbitration agreement was allegedly void. They served an “interim response” on the Owners and asked the Tribunal for a three-week time extension “to prepare and submit appropriate submissions/application before … the Sole Arbitrator”.

On 9 July 2024, the sole arbitrator rendered an award ordering the Charterers to pay the Owners – respondent and claimant in the arbitration, respectfully – US$ 295,508.13 (with the initial claim being US$304,912.75) (the “Award”).

English court proceedings

The Charterers challenged the Award based on s.72 of the Act. They also tried to introduce – albeit very belatedly – the amendment to the Claim Form purportedly pleading the fraud.

S.72 challenge

S.72 of the Act (as at the date of the Claim Form) reads as follows: “[A] person alleged to be a party to arbitral proceedings but who takes no part in the proceedings may question—(a) whether there is a valid arbitration agreement, (b) whether the tribunal properly constituted, or (c) what matters have been submitted to arbitration in accordance with the arbitration agreement, . . . He also has the same right as a party to the arbitral proceedings to challenge an award” under s.67 (substantive jurisdiction) or under s.68 (serious irregularity). Accordingly, the Charterers argued that they indeed had not taken part in the arbitration proceedings but only protested to the jurisdiction of the sole arbitrator to hear the case. To that extent, the Charterers referred to the Award itself where at [34] the sole arbitrator observed that “the Charterers have chosen not to participate in this reference”.

Judgment

Allegations of fraud

The Court first considered whether to allow the late amendments to the Claim Form purported to introduce allegations of fraud.

The Court refused to do that on the grounds of them being submitted too late and without real prospect of success. In that vein, it is important to say that s.72 of the Act allows challenging an arbitral award within 28 days from the day of the award. The Charterers issued the Claim Form on 6 August 2024 – on the last day of the 28-day period, and without any reference to the alleged fraud. The first time the Charterers alluded to the fraud being perpetrated was only in a witness statement of the Charterers’ another director, at the end of September 2024. Finally, an application to amend the Claim Form was filed by the Charterers on 24 January 2025.

The Court was not impressed by the Charterers’ delays, nor was it happy with the substance of the fraud allegations. On procedure, the Court observed at [25] that the “short period” of 28 days to challenge arbitral awards “was imposed in order to serve the principles of speed and finality in respect of arbitration claims”. On substance, the Court was not convinced by the Charterers’ arguments about Mr Puria acting in concert with the Owners to defraud the Charterers. The Court considered the Charterers’ arguments and found no case for fraud, rather observing at [44], referring to the Owners’ counsel, that “the facts as pleaded in the Charterers’ draft amended Claim Form lack coherence and are more consistent with honesty on Owners’ part than dishonesty….”.

Did the Charterers take part in the arbitration proceedings?

The Court was content at [73] that the Charterers indeed purported not to take part in the arbitration proceedings, but they seemed to fail walking on that tight rope and slipped on the side of taking part in the proceedings: “It may well have been Charterers’ intention not to take part in the proceedings, but I consider that is what they in fact did”. On that point, it appears that the main step that tilted the scale against the Charterers was their request for a three-week time extension “to prepare and submit appropriate submissions/application before … the Sole Arbitrator”. In that regard, the Court said at [73]: “Seeking an extension was, in my judgment, engaging in the arbitral process because it was an implicit acknowledgement of the process and inconsistent with the reservation of rights previously expressed.”

Further, it is worth noting that the Court discarded the Charterers’ reference to the sole arbitrator’s finding that “the Charterers have chosen not to participate in this reference”, finding at [73] that “‘participating in’ and ‘taking part in’ the proceedings are two very different things”. In other words, on a very thin semantic point, the Court ruled that “participating in” is a higher bar then “taking part in” the proceedings and a party not participating in the proceedings can still be considered as taking part therein.

Having ruled that the unamended Claim Form had no real chances of success, the Court granted the Owners’ strike-out application and dismissed the Charterers’ s.72 application.

Conclusion

The judgment demonstrates how fine may be the line between protesting to the jurisdiction of an arbitral tribunal and taking part in the arbitral proceedings. Crossing this line, though, may be fatal for the future challenge of the arbitral tribunal’s jurisdiction under s.72 of the Act. The judgment is also a good reminder that to advance a fraud case it is not enough to put bare allegations of fraud – a party also needs to substantiate them. Finally, the judgment shows that the English courts robustly police 28-day periods for challenging arbitral awards, and a party seeking to introduce late amendments to the Claim Form must provide very good reasons for the delay.

The judgment can be found here.

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