The British courts have once again made it clear to Spain that they operate according to their own rules, at least in commercial matters. Judge Christopher Butcher, head of one of the commercial and property law chambers of the Supreme Court of England and Wales, has rejected the Spanish government’s claim to be able to recover damages from the insurer of the oil tanker Prestige, which sank off Galicia in 2002. and traveled thousands of kilometers in fuel, the more than 850 million euros that the Supreme Court ordered him to pay, as direct civil liability for the damage caused to the Spanish coasts by the tragic Chapapote disaster.
The judge, in a ruling reported by El Confidencial, has backed insurer London Steam-Ship Owners Mutual Insurance Association Limited, known in the business community as UK P&I Club, in its dispute with the Spanish state. Prosecutors used Article 117 of the Criminal Code to claim financial liability from the insurer after filing complaints against the shipping company and the captain of the Bahamas-flagged Prestige. From the beginning of the process, the UK P&I Club adhered to the provisions set out in its own regulations, which acted as a valid contractual clause. Rule 40C states that claims must always be brought in the London Arbitration Tribunals and that proceedings in this regard will be conducted under the English Arbitration Act 1996. The insurer’s rules also exclude any claims against him, while the owner of the Prestige would not have fulfilled his financial obligations earlier. Finally, the amount to be paid by the British P&I Club would never exceed one billion dollars.
These are the more than 850 million euros that first the Provincial Court of A Coruña and later the Supreme Court awarded against the insurer when confirming the judgments. The Spanish State initially decided not to participate in the arbitration proceedings initiated by the insurer on London soil, preferring to seek protection from the Court of Justice of the European Union, at a time when the United Kingdom was still dealing with the consequences of Brexit had not been fully implemented. and in theory it remained linked to the decisions of the Court of Justice of the European Union.
A British commercial court then appointed lawyer Alistair Schaff as arbitrator, and his decision, known as the Schaff arbitration, ruled in favor of the insurer on most arguments. “The Spanish judgment (of the Supreme Court) is inconsistent with section 66 of the English Arbitration Act and its recognition would be contrary to the principles of English public law relating to ‘res judicata’ in relation to the ‘Schaaf arbitration’. “ “, which was confirmed by the British courts. That means what has already been decided cannot be reheard, says Judge Butcher, to reject Spain’s claims. The ruling grants the possibility to appeal against some of its arguments from the outset, but makes it difficult for the Spanish state. It also complements previous rulings in which British courts gave arbitration awards priority over Spain’s legal claims, as they did when they ruled in favor of some funds in a dispute over renewable energy premiums. As a result of this setback, the accounts of the Cervantes Institute in London were confiscated.
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