Legal Question in Admiralty Law in United Kingdom
Arbitration in London, Verified Complain in US
I represent Bahamas Corporation (Defendant). Marshall Islands
Corporation (Plaintiff) initiated arbitration in London claiming breach of
Contract. We, however, have not signed any Contract with the Plaintiff, ever. Moreover, we found out about this fact from our bank only after our correspondent account in the US was arrested based on a Verified Complaint filed with U.S.C., New York. In US court, the Plaintiff �seeks to obtain adequate security to satisfy a potential London arbitration award in Plaintiffs favor�. At this time our office has not received any official information either from the Plaintiff or from London or New York.
2 Answers from Attorneys
Re: Arbitration in London, Verified Complain in US
This is a Federal Supplemental Admiralty Rule B maritime prejudgment attachment, brought in aid of supposed arbitration under the Federal Arbitration Act. To have a proper Rule B attachment, the defendant (your company/client) must not be "found" within the Southern District of New York (the federal court district in which the maritime prejudgment attachment complaint apparently has been brought). "Not found" within the terms of Supplemental Rule B means, that either the defendant is not "present in the District for purposes of service of process," or that the defendant has insufficient "minimum contacts" with the district. If the defendant both is "present" for service of process and there are "minimum contacts," then, the attachment can be defeated, even if there have been assets attached. It may also be possible to defeat the attachment claiming that there is no valid arbitration agreement.
It is typical that the defendant has no prior notice of these proceedings, and in fact may not have notice for some time after the attachment.
We are one of the most active U.S. law firms working in the area of maritime prejudgment attachment and vessel arrest, including, before the United States District Court for the Southern District of New York and in connection with London and other similar maritime arbitration proceedings. The Federal Supplemental Admiralty Rules give a defendant a right to a "prompt hearing" to challenge a Rule B attachment and if your company/client wish to raise such a challenge you should retain counsel and proceed promptly with the challenge. Further information about our firm and practice, and contact information, is at our web site, http://www.simmsshowers.com .
Re: Arbitration in London, Verified Complain in US
It's not surprising that they try to do that, and without knowing the facts it's hard to say whether the attachment is proper. I would be glad to look at it and see if we think we can try to get the attachment released. It may be as simple as pointing out that they sued the wrong entity, or it may require that you defend the London arbitration (we would be glad to discuss that possibility with you as well).
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