Cynic - R print

XVI NLSTIAM, 2023
CYNIC-R
IN THE MATTER OF AN ARBITRATION
UNDER THE ARBITRATION RULES OF THE
SINGAPORE INTERNATIONAL ARBITRATION CENTRE
AND THE ARBITRATION ACT 1996
BETWEEN
ADORNIA LTD CLAIMANT
-AND-
EXCHEQUER INSURANCE PVT LTD. RESPONDENT
ARBITRAL TRIBUNAL
LORD MARTIN (CHAIRMAN);
LADY BROWN (CO – ARBITRATOR); PROFESSOR SHARPE KC (CO – ARBITRATOR)
SEAT OF ARBITRATION: LONDON, UNITED KINGDOM
WRITTEN SUBMISSION ON BEHALF OF THE RESPONDENTS

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XVI NLS TRILEGAL INTERNATIONAL ARBITRATION MOOT
TABLE OF CONTENTS
TABLE OF ABBREVIATIONS ............................................................................................... 3

INDEX OF AUTHORITIES...................................................................................................... 5
STATEMENT OF JURISDICTION........................................................................................ 10
STATEMENT OF FACTS ...................................................................................................... 11
STATEMENT OF ISSUES ..................................................................................................... 15
SUMMARY OF ARGUMENTS ............................................................................................. 16
ARGUMENTS ADVANCED ................................................................................................. 17
1. WHAT CONFLICT OF LAWS RULES SHOULD THE TRIBUNAL APPLY TO DECIDE
WHETHER THE EXCHEQUER CONTRACT IS VOID FOR WANT OF CAPACITY BY REASON OF
THE 2014 ACT? .................................................................................................................... 17
A. Necessity for the rules of choice of law and jurisdiction .......................................... 17

B. By what law capacity to contract is determined. ....................................................... 18
C. Choice of law by the parties (party autonomy) ......................................................... 19
D. The real seat rule/theory ............................................................................................ 20
E. Doctrine of the proper law ........................................................................................ 21
2. APPLYING THOSE CONFLICT OF LAWS RULES, IS THE EXCHEQUER CONTRACT
VOID FOR WANT OF CAPACITY BY REASON OF THE 2014 ACT? .................................... 22
A. Application of the Proper Law Doctrine. .................................................................. 22
B. The Impugned Judgement Cannot Be Applied To The Dispute ............................... 23
3. IF THE EXCHEQUER CONTRACT IS VOID:................................................................... 24
A. Does Adornia Have A Claim To Recover The Premium Paid By Way Of Restitution
Of Unjust Enrichment? ..................................................................................................... 24
B. Does Exchequer Have The Defence Of Change Of Position? .................................. 25
4. IF THE EXCHEQUER CONTRACT IS NOT VOID: .......................................................... 27
A. Is Adornia, without the consent of the Syndicate 41 insurers, entitled (whether under
Rule 39.2 of the SIAC Rules or otherwise), to refer to the contents of the Syndicate 41
Award?.............................................................................................................................. 27
B. If so, is Exchequer bound by issue estoppel by the Syndicate 41 Tribunal’s findings
as to whether the losses for which Adornia was seeking an indemnity fell within the
insuring clause? ................................................................................................................ 29
C. If not, do those losses in fact fall within the insuring clause? ................................... 31
PRAYER ................................................................................................................................. 33
WRITTEN SUBMISSION FOR RESPONDENTS

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TABLE OF ABBREVIATIONS
ABBREVIATION TERM
¶ PARA
§ SECTION
& AND
AIR ALL INDIA REPORTER
ANR ANOTHER
CH CHAPTER
CL. CLAUSE
CO. COMPANY
E D. EDITION
HON’BLE HONORABLE
LTD. LIMITED
NO. NUMBER

4
ORS. OTHERS
P. PAGE
PVT. PRIVATE
SC SUPREME COURT
SCC SUPREME COURT CASES
SCR SUPREME COURT REPORTER
SIAC SINGAPORE INTERNATIONAL ARBITRATION

CENTRE
V. VERSUS

5
INDEX OF AUTHORITIES
INDIAN CASES:
S.NO NAME CITATION PARA

NO.
1. Bajaj Allianz General Insurance v. The State C.A. No.-002366-002367 73

of Madhya Pradesh. / 2020,
2. Bharat Aluminium Co. v. Kaiser Aluminium (2016) 4 SCC 126 13

Technical Services Inc.
3. General Assurance Society Ltd. v. AIR 1966 SC 1644 72

Chandumull Jain
4. Kuwait Airways Co. v. Iraqi Airways Co AIR 1963 SC 1. 5
5. Official Administrator v. Anba Bola Convent (1900-1931) 1 SLR 521 1
6. Reliance Industries Ltd. v. Union of India (2014) 7 SCC 603 14
7. Sakuma Exports Limited vs Louis Dreyfus 2013 (6) BomCR 218 12

Commodities
8. Satyabrata Ghose v. Mugneeram Bangur and (1954) SCR 310 42

Co.
9. Suraj Mal Ram Niwas Mills Pvt. Ltd v. C.A. No. 1375 / 2003. 73
United India Ins. Co. Ltd
10. United India Insurance Co. Ltd. Vs. (2004) 8 SCC 644 72
Harchand Rai Chandan Lal
11. Vikram Greentech India Ltd. v. New India (2009) 5 SCC 599 71
Assurance Co. Ltd.

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FOREIGN CASES:
S.NO NAME CITATION PARA

NO.
12. Ali Shipping v Shipyard Trogir [1998] 1 Lloyd’s Rep 56

643.
13. Arnold v National Westminster Bank plc [1991] 2 AC 93 67
14. Baindail v. Baindail [1946] 1 All ER 342 26
15. Bayerisches Oberstes Landesgericht 46 [WM] 1371 (1992). 17
16. Bertonneau v. Southern Pacific Co. 120 Pac. 53 (1911). 16
17. Bodley Head Ltd. v. Flegon [1972] 1 WLR 680. 28
18. Burr v. Beckler 106 N. E. 206 (1914) 8
19. Carl Zeiss Stiftung v Rayner and Keeler Ltd [1967] 1 AC 853 67
20. Charron v. Montreal Trust Co (1958) 15 DLR (2d) 240. 27
21. Dolling-Baker v. Merrett & Another [1991] 2 All ER 890 57
22. Fidelitas Shipping Co. Ltd. v VO [1965] 2 WLR 1059 63

Exportchleb
23. Geismar vs Sun Alliance and London [1978] 2 Lloyds Rep 233 38
Insurance Ltd. (CA).
24. Gienar v. Meyer (1796) 2 Hy. B1. 603 22
25. Hassneh Insurance Co. of Israel v. Mew [1993] 2 Lloyd's Rep. 58

243.
26. Lipkin Gorman v Karpnale Ltd. [1988] UKHL 12. 36
27. Low v Bouverie [1891] 3 Ch 82 (CA) 47

7
28. Mayer v. Roche 75 Atl. 235 (1909). 7
29. Mount Albert Borough Council v. (1937) 4 All E.R. 206 21

Australaisan Temperance and General
Mutual Life Assurance Society
30. Oxford Shipping Co. Ltd. V. Nippon Yusen (1984) 2 Lloyd’s rep. 373 56
Kaisha (Q.B. Com. Ct.)
31. Poole v. Perkins 101 S. E. 240 (1919) 7
32. Sinclair v. Broughams [1914] AC 398 46
33. Skyring v Greenwood 107 ER 1064 (KB) 47
34. The Indian Endurance (No 2) Republic of [1996] 3 All ER 641 47

India v India Steamship Co. Ltd. (CA)
35. Thoday v. Thoday [1964] 2 WLR 371 63
36. Union National Bank v. Chapman 169 N. Y. 538 8
37. Union Trust Co. v. Knabe 89 Atl. 1106 (1914) 8
STATUTES REFERRED
S.NO NAME OF THE STATUTE OR THE LAW REFERRED

1. THE INDIAN CONTRACT ACT, 1872
2. SIAC RULES, (2016)
BOOKS AND ARTICLES:
S. NO. NAME OF BOOK / ARTICLE.
1. 2 BEALE, A TREATISE OF THE CONFLICT OF LAWS (1936) § 332

8
2. '9. Award', in Nigel Blackaby, Constantine Partasides, et al., Redfern and

Hunter on International Arbitration (Seventh Edition), 7th edition (© Kluwer
Law International; Oxford University Press 2023)
3. Bernhard Grossfeld, Commentary, in JULIUS VON STAUDINGER,

KOMMENTAR ZUM BORGERLICHEN GESETZHUCH MIT
EINFOHRUNGSGESETZ UND NEBENGESETZEN:
INTERNATIONALES GESELLSCHAFTSRECHT at 7, 64 (1998).
4. BRIGGS, ADRIAN, ET AL. DICEY, MORRIS AND COLLINS ON THE

CONFLICT OF LAWS, 725-740 (Sweet & Maxwell 2012).
5. Brown AC, “Presumption meets reality: an exploration of the confidentiality

obligation in international commercial arbitration.” Am U Int’l L Rev 16:
969–1025 (2001).
6. David Gwynn Morgan: “The Retrospective Dimension of the 2002-03

Australian Personal Injuries Reforms”, 29 Statute Law Review 53 (2008).
7. Elise Bant, The Change of Position Defence (2009), Oxford and Portland,
Oregon, 2009.
8. Emmanuel Gaillard, The Role of the Arbitrator in Determining the

Applicable Law in Lawrence W. Newman & Richard D. Hill (eds), The
Leading Arbitrators (Guide to International Arbitration, 2004) 1; Julian D.
M. Lew and other, Comparative International Commercial Arbitration
(Kluver Law International, 2003) 413.
9. Gaillard, E., Abuse of Process in International Arbitration, ICSID Review,

2017, p. 2.
10. Gray, Charles M. “The Ages of Classical Contract Law.” The Yale Law
Journal, vol. 90, no. 1, 1980, pp. 216–31. JSTOR,
https://doi.org/10.2307/795862. Accessed 20 Mar. 2023.
11. Halsbury's Laws of England (4th ed., 2006)

9
12. Handley, K. R., & Spencer Bower. G. “Res judicata”, 4th Ed. (2009).
13. INTERNATIONAL LAW REPORTS 270 (Cambridge University

Press.1963).
14. J. H. Beale, Jr., “Dicey’s Conflict of Laws”, Harvard Law Review, Oct. 26,
1896, Vol. 10, No. 3 (Oct. 26, 1896).
15. M Giuliano and P Lagarde, Report on the Convention on the Law Applicable
to Contractual Obligations (“Guiliano–Lagarde Report”), 34 (1980).
16. Nick Sutton, Business Interruption Insurance: A Lifeline for Financially

Distressed Businesses Potentially Facing Insolvency? MONDAQ, (31st
March 2021)
17. PM North, JJ Fawcett: ‘Cheshire and North’s Private International Law’ 13th
Ed. Oxford University Press.
18. Saloni Khanderia (2020) Practice does not make perfect: Rethinking the
doctrine of “the proper law of the contract” – A case for the Indian courts,
Journal of Private International Law, 16:3.

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STATEMENT OF JURISDICTION
Adornia Pvt Ltd. (Claimant) respectfully submits this memorandum and invokes the
jurisdiction of the arbitral tribunal in accordance with the Clause 18 of the Contract of
Insurance with Exchequer Insurance Pvt Ltd. (Respondent) which is to be governed by the
SIAC rules 2016. The seat of Arbitration is London, United Kingdom, and Respondent
submits to the jurisdiction of the Hon’ble Arbitral Tribunal.

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STATEMENT OF FACTS
BACKGROUND: In the late 1990s, Priti Hotels Ltd board concluded that the market for luxury
goods and services in India was rapidly growing, given the expanding middle class and the
rising number of high-net-worth individuals. To tap into this market, PHL incorporated a
subsidiary, Adornia Ltd to operate exclusively in the luxury space, in the Marshall Islands,
mainly for tax reasons. Adornia Ltd purchased a large quantity of land on the outskirts of
Mumbai to build a luxurious complex, which was named Adornia Island. it became operational
in 2015 after obtaining all necessary regulatory approvals. They recognized the importance of
obtaining extensive and comprehensive insurance coverage for Adornia, should any major
disruption occur despite the backup systems in place.
MARSHAL ISLAND LEGISLATURE: The Adornia board was concerned that the Speculative
Contracts (Restrictions) Act 2014 enacted by the Marshall Legislature might prevent Adornia
from entering into contracts of insurance and that any insurance obtained by its parent company
or someone else on its behalf might be ineffective. Adornia sought advice from a leading City
firm and King's Counsel in London before commencing operations, who advised that while
there was some risk involved, Adornia was entitled to enter into insurance contracts despite the
provisions of the 2014 Act.
THE INSURANCE COVERAGE: Adornia Ltd obtained a comprehensive insurance package,
including business interruption cover, through Syndicate 41, but the potential exposure was so
substantial that the cover was placed with a syndicate of insurers rather than an individual
insurer. The policy provided Adornia with cover of £250 million per year, which was thought
to be the absolute minimum that it needed and likely insufficient. Adornia actively sought to
enter into further insurance contracts but had great difficulty finding anyone willing to take its
business, given the risks involved. Eventually, Exchequer Insurance Private Ltd was persuaded
to assist and entered into a property damage and business interruption insurance policy with
Adornia, providing cover up to £50 million with a premium of around £8 million a year.
HURRICANE INDRA: Adornia Island suffered significant losses due to Hurricane Indra. The
evacuation of the island before the hurricane hit prevented loss of life but physical damage was
still significant. Entry to the area was prohibited and strictly regulated by the State Government,
resulting in a 99.5% fall in visitor footfall from March 2019 to November 2019. Adornia
Island's losses were estimated to be in the region of £265 million due to the absence of visitors

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and the cost of construction. The insurance policies obtained by Adornia Island, may provide
some coverage for these losses, subject to the specific terms and conditions of the policies.
INSURANCE CLAIM DISPUTE: Syndicate 41 insurers stated their willingness to compensate
Adornia for the cost of construction incurred in repairing the damage caused to the building
but denied payment for loss of profit from August 2018 to November 2019, as the damage was
due to government action following the hurricane and not the hurricane in itself. The same
stance was taken by Exchequer. Adornia served notices of arbitration on both the Syndicate 41
insurers and Exchequer, who were represented by the same law firm and counsel. BLT LLP
wrote to Adornia, inviting it to consent to consolidation of the two arbitrations, but Adornia
refused, and instead proposed a stay of one arbitration pending the conclusion of the other.
THE SYNDICATE 41 ARBITRATION: Exchequer was closely involved in the Syndicate 41
arbitration, attending all hearings and contributing to the costs incurred by the insurers. In the
Syndicate 41 arbitration, the only issue raised was whether the sum claimed by Adornia fell
within the insuring clause, and the Tribunal found that it did. The arbitration was concluded
with an award dated 21 December 2020. Adornia still had a shortfall of around £15 million,
which it sought to recover in the Exchequer arbitration. In response, BLT (on behalf of all
insurers) wrote to Forty Nine Law, notifying them that the Syndicate 41 award was confidential
and that the Syndicate 41 insurers would not consent to any attempt by Adornia to use it in the
Exchequer arbitration. Adornia subsequently applied to the Exchequer Tribunal to lift the stay,
which the Tribunal granted.
THE SUPREME COURT JUDGEMENT’S EFFECT: Marshall Islands Supreme Court held in a
judgement that, § 9 of the 2014 Act, did prevent any Marshall Islands company from entering
into a contract of insurance, even for legitimate commercial reasons. Adornia sought
permission to advance a different case, including that the Exchequer contract was void for want
of capacity, and that it was entitled to recover all the premium it had paid by way of restitution
for unjust enrichment. Exchequer objected to Adornia's attempt to refer to the Syndicate 41
Award on the grounds of confidentiality, but the Tribunal allowed the amendment application,
subject to reserving the confidentiality objection for consideration at the merits hearing.
The Tribunal has identified the issues that it requires counsel to address at the merits hearing
listed for May 2023 in Procedural Order No. 4.

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TIMELINE OF EVENTS:
1986 Priti Karnik opens first hotel in Mumbai, Priti Hotels Ltd.
The late 1990s PHL incorporates a subsidiary called ‘Adornia Ltd’ in Marshall
Islands to exclusively operate under luxury space.
2014 Enactment by the Marshall Islands Legislature, Speculative
Contracts (Restrictions) Act.
2015 The building was completed, named Adornia Island and became
operational.
10th January 2015 Adornia enters into a property damage and business interruption
insurance policy with Exchequer.
5th April 2018 Adornia Islands’ net profit for the year ended was 475 Pounds.
15th August 2018 Adornia Island closed to the public and evacuated.
16th August 2018 Hurricane Indra began in an area not far from Adornia Island.
18th August 2018 Indra reached category 5 on the Saffir Simpson Hurricane wind
scale.
23rd August 2018 Hurricane subsided
21st February 2019 Affected buildings were substantially rebuilt , Adornia Island
reopened.
Till 29th November No visitors as entry to the area was initially prohibited and strictly
2019 regulated by the state government, focusing on gradually allowing
residents to return but not visitors.
Between August 2018 the loss of profit from the absence of visitors was estimated to be
to November 2019 265 million Pounds
2nd March 2020 Adornia was not prepared to consent to consolidation (it served
notice of arbitration to both Syndicate 41 and Exchequer who were
represented by the same law firm and invited Adornia to consent to
consolidation and appointing common arbitrators for both
references)
Between 6th March Exchequer was closely involved at every stage of the Syndicate 41
to 21st December arbitration. It contributed to the costs incurred.
21st December, 2020 The syndicate 41 tribunal issued an Award in which it found that
all losses for which Adornia claims under the policy all within the

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insuring clause as it represents business interruption suffered as a

consequence of damage to property. Ordered Syndicate 41 to pay
250 million pounds.
Supreme Court Contrary to the generally accepted rule at that time, § 9 of the Act
Judgement in Zebra prevents any Marshal Island Company from entering into a contract
Plastics Ltd. of insurance even for legitimate commercial reasons.
May 2023 Hearing listed.

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STATEMENT OF ISSUES
1. WHAT CONFLICT OF LAWS RULES (IF ANY) SHOULD THE TRIBUNAL APPLY TO DECIDE
WHETHER THE EXCHEQUER CONTRACT IS VOID FOR WANT OF CAPACITY BY REASON
OF THE 2014 ACT?
2. APPLYING THOSE CONFLICT OF LAWS RULES, IS THE EXCHEQUER CONTRACT VOID FOR
WANT OF CAPACITY BY REASON OF THE 2014 ACT?
3. IF THE EXCHEQUER CONTRACT IS VOID:
a. DOES ADORNIA HAVE A CLAIM TO RECOVER THE PREMIUM PAID BY WAY OF

RESTITUTION OF UNJUST ENRICHMENT?
b. IF SO, DOES EXCHEQUER HAVE A DEFENCE OF CHANGE OF POSITION?
4. IF THE EXCHEQUER CONTRACT IS NOT VOID:
a. IS ADORNIA, WITHOUT THE CONSENT OF THE SYNDICATE 41 INSURERS,

ENTITLED (WHETHER UNDER RULE 39.2 OF THE SIAC RULES OR OTHERWISE),
TO REFER TO THE CONTENTS OF THE SYNDICATE 41 AWARD?
b. IF SO, IS EXCHEQUER BOUND BY ISSUE ESTOPPEL BY THE SYNDICATE 41

TRIBUNAL’S FINDINGS AS TO WHETHER THE LOSSES FOR WHICH ADORNIA
WAS SEEKING AN INDEMNITY FELL WITHIN THE INSURING CLAUSE?
c. IF NOT, DO THOSE LOSSES IN FACT FALL WITHIN THE INSURING CLAUSE?

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SUMMARY OF ARGUMENTS
-For the first issue-

The Respondent submits that courts have accepted the necessity for the rules of conflict of
law and jurisdiction and have applied the rules to understand the law that is applied and
governs international contracts. In the instant case, that the following conflict of laws rules
can be applied by this tribunal to decide whether the contract in question is void for want of
capacity by reason of the Speculative Contracts (Restrictive) Act, 2014. Firstly, the law
intended by the parties to be applied (Party Autonomy). Secondly, the Real seat rule/theory
and lastly, the Doctrine of the Proper law.
-For the second issue-

It is most humbly submitted that the Claimants do have the capacity to contract; and the
governing law stays Indian; by way of [2.1] Applying the proper law doctrine. It is also
pertinent to note that [2.2] the impugned judgement cannot be applicable to the present
dispute.
-For the third issue-

It is respectfully submitted that if the contract is void by the virtue of the Speculative
Contracts (Restriction) Act, Adornia Ltd. cannot recover the premium paid stating that it was
unjust enrichment by Exchequer Insurance Pvt. Ltd. Moreover, Exchequer Insurance Pvt.
Ltd. is entitled to the defense of change of position as it had substantially changed its position
based on the premium paid by Adornia Ltd over the years.
-For the fourth issue-

The respondent submits that supposing the Exchequer contract is not void, the claimants are
not entitled to refer to the Syndicate 41 award to enforce its claim as there exists no
reasonable necessity for invocation of Rule 39.2 of the SIAC. It is also submitted that the
respondents are not bound by issue estoppel to the findings of the Syndicate 41 tribunal as the
issue in question is governed by a different law. Regardless, the respondents submits that the
losses suffered by the claimants do not fall within the terms of the insuring clause as the
policy should not be liberally interpreted.

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ARGUMENTS ADVANCED
1. WHAT CONFLICT OF LAWS RULES SHOULD THE TRIBUNAL APPLY TO DECIDE

WHETHER THE EXCHEQUER CONTRACT IS VOID FOR WANT OF CAPACITY BY REASON
OF THE 2014 ACT?
It is most reverently submitted that courts have accepted the necessity for the rules of conflict
of law and jurisdiction and have applied the rules to understand the law that is applied and
governs international contracts. Exchequer Insurance Pvt Ltd (hereinafter Respondent) submits
that the following conflict of laws rules can be applied by this tribunal to decide whether the
contract in question is void for want of capacity by reason of the Speculative Contracts
(Restrictive) Act, 2014 (hereinafter The Act). Firstly, the law intended by the parties to be
applied (party autonomy). Secondly, the rule of proper law and lastly, the doctrine of real seat.
A. NECESSITY FOR THE RULES OF CHOICE OF LAW AND JURISDICTION
1. Courts have accepted the necessity for the rules of conflict of law and jurisdiction. It is
submitted that in plethora of cases including Official Administrator v. Anba Bola
Convent1 whereupon the court acknowledged that the necessity of private international law
rules regarding choice of law has arisen from the pressure of modern conditions or
international intercourse and would be desirable if they are nearly uniform from state to
state.
2. The purpose of private international law is to make possible the application of laws, within
the territory of the state, of the law of foreign states. This is a decision that was made in
response to concerns about justice, practicality, the requirements of international relations,
and even, as has occasionally been claimed, an enlightened view of public policy itself.2
3. The Supreme Court of India in S. Viswanathan v. Abdul Wajid,3 held that conflict of laws
is simply a branch of the civil law of the State involved to do justice between litigating
parties in respect of transactions involving a foreign element.
1
(1900-1931) 1 SLR 521
2
INTERNATIONAL LAW REPORTS 270 (Cambridge University Press.1963).
3
AIR 1963 SC 1.

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4. The conflict of law rules of each state differs in their very nature, but certain rules are
recognised as common to civilised jurisdictions by the comity of nations. It is submitted
that these common rules have been adopted as part of each state's judicial system to
adjudicate on disputes involving a foreign element and to carry out judgements of foreign
courts in certain matters, or as a result of international conventions.
5. The court in Kuwait Airways Corpn V Iraqi Airways Co held that Conflict of Laws
jurisprudence is primarily concerned with the just disposition of proceedings involving a
foreign element. The jurisprudence is founded on the recognition that in multi-country
proceedings, an issue brought before a court in one country may be more appropriately
decided by reference to the laws of another country, even if those laws differ from the law
of the forum court.”4
B. BY WHAT LAW CAPACITY TO CONTRACT IS DETERMINED.
6. It is most reverently submitted that there are three rules which different courts apply to
determine the capacity to contract. To begin, the rule states that capacity is determined by
the law of the parties' domicile. The lex domicillii annexes powers and inhibitions, and they
follow the person wherever he goes. This concept applies in common law as well but may
not be is not regarded as possessing such a broad connotation.
7. Secondly, the question of capacity is determined by the law of the place of the making of
the contract, or by the law of the place of performance, depending on the intention of the
parties.5 According to this rule, the parties may, by the simple expedient of intending to
have their capacity determined by the law of some other place, escape the inhibitions
imposed upon them by the law of the jurisdiction in which they attempt to contract. The
intention of the parties may be implied or express.
8. Thirdly, according to the view which has been adopted by most of the courts in this country,
capacity to contract is determined by the law of the place of the making of the contract.6
Where the law of a state denies to persons within a certain class the power to perform
certain acts, whatever they do in an attempt to perform such acts can have no legal efficacy.
4
Kuwait Airways Co. V Iraqi Airways co, [2002] UKHL 19.
5
Poole v. Perkins, 126 Va. 331, 101 S. E. 240 (1919); Mayer v. Roche,77 N. J. L. 681, 75 Atl. 235 (1909).
6
Union Trust Co. v. Knabe, 122 Md. 584, 89 Atl. 1106 (1914); Burr v.Beckler. 264 Ill. 230. 106 N. E. 206 (1914);
Union National Bank v. Chapman, 169 N. Y. 538, 62 N. E. 672 (1902).

19
9. Dicey's enunciation of contract validity or invalidity with respect to English Law is that it
must be determined according to English law, regardless of any foreign law, (a) where the
latter is contrary to public policy in English law. (b) where it is contrary to English statutory
law.7 The same principle can be applied in the case of India, stating that Indian law governs
where foreign law is contrary to Indian public policy or contrary to Indian statutory law,
either by the terms of the statute or by virtue of established principles of statutory
interpretation.
10. The law of the country in which a transaction takes place governs the validity of a foreign
contract assignment and the capacity of parties to contract. However, the law of the place
of performance governs the mode of performance of a contract.
C. CHOICE OF LAW BY THE PARTIES (PARTY AUTONOMY)
11. The counsel submits that the parties to an international contract have the freedom to
determine the applicable law to govern their contract. Nearly all international arbitration
laws, rules, and conventions recognize the principle of party autonomy.8 The origin of this
basic principle of autonomy is the fidelity of the English law to the dogma of “laissez
faire.”9 During a conflict of laws, the courts are said to choose among at least four
approaches without discernible coordination, namely,
1. The law of the place where a contract is made (lex loci contractus)
2. The law of the place where the contract is to be performed (lex loci solutionis)
3. The law intended by the parties to be applied (party autonomy)
4. The law which upholds the validity of the contract
12. As mentioned above, the 3rd approach is the law chosen by the parties. The counsel submits
that the principle of party autonomy in an international commercial agreement may lead to
the contract incorporating provisions regarding the proper law of the contract, proper law
7
BRIGGS, ADRIAN, ET AL. DICEY, MORRIS AND COLLINS ON THE CONFLICT OF LAWS, 725-740
(Sweet & Maxwell 2012).
8
Emmanuel Gaillard, The Role of the Arbitrator in Determining the Applicable Law in Lawrence W. Newman &
Richard D. Hill (eds), The Leading Arbitrators (Guide to International Arbitration, 2004) 1; Julian D. M. Lew and
other, Comparative International Commercial Arbitration (Kluver Law International, 2003) 413.
9
Gray, Charles M. “The Ages of Classical Contract Law.” The Yale Law Journal, vol. 90, no. 1, 1980, pp. 216–
231. JSTOR, https://doi.org/10.2307/795862. Accessed 20 Mar. 2023.

20
of the arbitral agreement and the curial law. The first is the governing law of the contract
which defines the substantive rights and obligations of the parties.10 In the case at hand, the
parties of the contract of insurance with Exchequer dated 10 January 2015, in clause 17 has
agreed that the policy is to be governed by the Indian Law.11
13. The court in the case of Bharat Aluminium Co. v. Kaiser Aluminium Technical Services
Inc.,12, held that party autonomy being the brooding and guiding spirit in arbitration, the
parties are free to agree on application of three different laws governing their entire contract
(1) proper law of contract, (2) proper law of arbitration agreement, and (3) proper law of
the conduct of arbitration, which is popularly and in legal parlance known as “curial law”.
14. The court in Sumitomo Heavy Industries Ltd. v. ONGC Ltd.13, which is one of the earliest
decisions in that direction also mentioned the above three aspects and which has been
consistently followed in all the subsequent decisions including the recent Reliance
Industries Ltd. v. Union of India14 where it was held the difference between interpreting
statutes and documents and the legal quality of documents by laymen. The contract's terms
will be comprehended in the manner that the parties desired and intended. Apart from the
plain or grammatical meaning of the expressions and their use at the proper places in the
agreement, how the parties worked out the agreement is one of the indicators to decipher
the intention in that context, particularly in agreements of arbitration where party autonomy
is the ground norm.
D. THE REAL SEAT RULE/THEORY
15. The Counsel contends that the real seat doctrine is a conflict of laws principle that
recognizes that only one state should have the authority to regulate a corporation's internal
affairs and that this authority belongs to the state in which the corporation has its real seat.15
It favors the law of the central administration or principal place of business for choice-of-
10
Sakuma Exports Limited vs Louis Dreyfus Commodities, 2013 (6) BomCR 218.
11
Moot Proposition, Annexure 3.
12
(2016) 4 SCC 126
13
1998) 1 SCC 305.
14
(2014) 7 SCC 603 : (2014) 3 SCC (Civ) 737.
15
Bernhard Grossfeld, Commentary, In JULIUS VON STAUDINGER, KOMMENTAR ZUM
BORGERLICHEN GESETZHUCH MIT EINFOHRUNGSGESETZ UND NEBENGESETZEN:
INTERNATIONALES GESELLSCHAFTSRECHT At 7, 64 (1998).

21
law purposes. The rationale behind the same is that it secures proper regard for economic
reality and prevents fraud on, or abuse of, the law.
16. It is a generally understood principle that the law intended by the parties shall prevail and
the intention of the parties may be either expressed or implied from their acts and conduct
at the time of making the contract.16 However, express provisions as to the law they desire
to govern their contract must be made in good faith by the parties or the court will not give
effect to them.17
17. It determines the governing law of a legal dispute based on the parties' "real seat," or the
location of their principal place of business or administrative centre. It is based on the
assumption that the state in which a corporation has its true seat is typically the state that is
most strongly affected by the entity's activities, and thus should have the authority to govern
the corporation's internal affairs.18
18. The 'real seat' theory affects both companies incorporated under a foreign system of law
but having their real seat on domestic territory, and companies incorporated under domestic
law having their management and control office abroad. Further, it is generally assumed
that business activities conducted on the territory of the state where the 'foreign' company
de facto resides should be supervised effectively.
19. The parties may also choose to rely on trade usage, a national rule of law, transnational
law, lex mercotoria (the law merchant), general principles of law or general principles of
international law.
20. The real seat doctrine seeks to level the playing field for all corporations with their principal
place of business within the state by requiring corporations to be formed in accordance with
the laws of the state most affected by their activities.19
E. DOCTRINE OF THE PROPER LAW
21. Quoting Lord Wright, the counsel submits that proper law may be defined as “that law
which the English or other court is to apply in determining the obligations under the
16
Bertonneau v. Southern Pacific Co., 17 Cal. App. 439, 120 Pac. 53 (1911).
17
2 BEALE, A TREATISE OF THE CONFLICT OF LAWS (1936), § 332.23 et seq.
18
Bayerisches Oberstes Landesgericht, 46 [WM] 1371 (1992).
19
Grossfeld, at 6.

22
contract.20 The term ‘proper law of a contract’ means the law, or the laws, by which the
parties intended, or may fairly be presumed to have intended, the contract to be governed,
or (in other words) the law or laws to which the parties intended, or may fairly be presumed
to have intended, to submit themselves.21
22. It has been recognized since at least the 1700s that – at the time of making the contract the
parties may expressly select the law by which it is to be governed.22 The Indian judiciary
adopts the common law tripartite hierarchy, viz., the “express choice”, “implied choice”
and “the closest and most real connection” test to determine the proper law.23
23. The counsel submits that clause 17 of the Exchequer Agreement signifies the will and
desire of the parties to select Indian Law as the governing law of the contract and English
Law as the Law for arbitration. 24
2. APPLYING THOSE CONFLICT OF LAWS RULES, IS THE EXCHEQUER CONTRACT

VOID FOR WANT OF CAPACITY BY REASON OF THE 2014 ACT?
A. APPLICATION OF THE PROPER LAW DOCTRINE.
24. It is humbly submitted by the Respondents that, applying the proper law doctrine and
existence of party autonomy, it shall be reasonably established that, the governing law of
the contract will be given predominance due to the existence of party autonomy.
25. India is the place of execution of contract, and the principal place of business. For the same
reason, India has the most connection to the contract and its performance as well.
26. The law of the place where the contract was made, governs the question of capacity.25 In
stating that capacity is governed by the proper law of the contract, this expression must be
taken to mean the law of the country with which the contract is most substantially
20
Lord Wright in Mount Albert Borough Council v. Australaisan Temperance and General Mutual Life Assurance
Society (1937) 4 All E.R. 206 at P. 215 (P.C.).
21
Dicey Conflict of Laws, 148.
22
Gienar v. Meyer (1796) 2 Hy. B1. 603.
23
Saloni Khanderia (2020) Practice does not make perfect: Rethinking the doctrine of “the proper law of the
contract” – A case for the Indian courts, Journal of Private International Law, 16:3, 423-450.
24
Moot Prop. Annexure 3.
25
Baindail v. Baindail [1946] P 122 at 128, [1946] 1 All ER 342 at 346; Anton, pp 276-278.

23
connected. A person cannot confer capacity upon himself by deliberately submitting

himself to a law to which factually the contract is unrelated.
27. Such modern authority as there is, would indicate that capacity to conclude a commercial
contract is regulated by the proper law of the contract objectively ascertained. This is
supported by the Canadian decision in Charron v. Montreal Trust Co.26 It was held there
that capacity to enter a separate agreement is by the law of the country with which the
contract is most substantially connected, i.e., proper law; though in the actual case this was
also the law of the place where the contract was made.
28. The issue of capacity arose in Bodley Head Ltd. v. Flegon27: The Russian author,
Alexander Solzhenitsyn, granted a power of attorney to H, a Swiss lawyer, to deal with his
literary works outside Russia. This power stated that Swiss law was applicable to any
disputes between the two parties. He assigned certain publication rights to a German
publishing house which, in turn, authorized the plaintiff to publish Solzhenitsyn’s works in
the United Kingdom. The Respondent disputed the plaintiff’s rights and proposed to
publish his own edition of Solzhenitsyn’s works. The plaintiff claimed copyright in the
works but the Respondent argued, inter alia, that the original agreement between
Solzhenitsyn and H was invalid as Solzhenitsyn had no capacity under Russian law, which
was both the law of the domicile and the law of the place where the contract was made, to
enter a contract to appoint an agent to contract abroad on his behalf.
29. Brightman J has no doubt that the question of his capacity was to be decided by the Swiss
Law, as the proper law of the contract. Although the point was not discussed, the facts of
this case did raise the issue that, in stating that capacity is governed by the proper law of
the contract, this expression must be taken to earn the law of the country with which the
contract is most substantially connected.28
B. THE IMPUGNED JUDGEMENT CANNOT BE APPLIED TO THE DISPUTE
30. The person under alleged incapacity, can only invoke his own incapacity if the other party
was aware of this incapacity or was not aware thereof as a result of negligence. The burden
26
(1958) 15 DLR (2d) 240.
27
[1972] 1 WLR 680.
28
PM North, JJ Fawcett: ‘Cheshire and North’s Private International Law’ 13 th Ed. Oxford University Press, Pg.
593.

24
of proof as to this will lie on the seemingly incapacitated party. If not satisfied, the party
will have capacity to contract.29
31. In the instant case, at the time of conclusion of the insurance contract, the commonly
accepted view was that, Adornia was on balance entitled to enter into insurance contracts
notwithstanding the provisions of the 2014 Act.30 Hence, during the time of entering into
the contract, it was not only the Respondent party, but even the Claimants were not aware
of the fact that they are incapacitated.
32. Therefore, it is evident that, the Claimants do have the capacity to contract, as during the
time of entering into the Insurance Contract, this was the commonly accepted and solicited31
view.
33. Moreover, it is also pertinent to note that, judgements do not entail retrospective
application. Traditionally, retrospectivity has been regarded as among the first qualities to
be mentioned, in any catalogue of factors, which are antithetical to any civilized concept of
law. And, it is one of the propositions that “just and effective law should be focused on the
future.”32
34. It is therefore, most humbly submitted that the impugned judgement will not be applicable
to this present Arbitration; and also, thereby conclusively submitted that, applying the
applicable conflict of law rule, the Exchequer Contract is void for want of capacity, by
reason of the 2014 Act.
3. IF THE EXCHEQUER CONTRACT IS VOID:
A. DOES ADORNIA HAVE A CLAIM TO RECOVER THE PREMIUM PAID BY WAY OF

RESTITUTION OF UNJUST ENRICHMENT?
35. It is humbly submitted by the Respondent that Adornia cannot recover the premium paid
stating it was unjust enrichment by Exchequer Ltd.
29
M Giuliano and P Lagarde, Report on the Convention on the Law Applicable to Contractual Obligations
(“Guiliano–Lagarde Report”), 34 (1980).
30
Moot Proposition, p 6.
31
Ibid.
32
David Gwynn Morgan: “The Retrospective Dimension of the 2002-03 Australian Personal Injuries Reforms”,
29 Statute Law Review 53 (2008).

25
36. The House of Lords had held that the basis of the claim for restitution of unjust enrichment
is the Respondent's unjust retention of a benefit at the claimant's expense.33
37. In the instant matter, the premium received by Adornia was pursuant to the contract that
was signed by both the parties and Adornia is in no way unjustly enriched. Thus there is no
requirement for restitution in the first place.
38. Neither Restitutio in Integrum nor Contract of indemnity imply to save an indemnity holder
who has committed an intentional wrongful act. This ‘argument was upheld in the
judgement of Geismar v. Sun Alliance and London Insurance Ltd.34 Geismar the plaintiff
had brought Jewellery into the United Kingdom, for which he failed to declare or pay the
customs duty. Later the plaintiff claimed an indemnity from the insurers for the jewellery
on account of loss of the same by theft. Since the jewellery was deliberately uncustomed,
the judges ruled in favour of the Respondent.
39. It is to be noted that Adornia was aware that an impediment was going to strike the business
and deliberately did not take efforts to prevent the hindrance. In this case, yet again
Exchequer can’t be said to be unjustly enriched and Adornia does not meet the requirements
to get the money back.
40. It is well established that there would be a defence to a claim in unjust enrichment that the
Respondent had so changed their position in good faith in reliance on the receipt of the
asset that it would be unconscionable or unfair to require him to make restitution.
B. DOES EXCHEQUER HAVE THE DEFENCE OF CHANGE OF POSITION?
41. It is most respectfully submitted by the Respondent that Exchequer does have the defence
of Change of Position and thus in no way liable to refund the premium to Adornia Ltd.
42. The "change of position" defence is a legal doctrine that may be raised by a party who has
received a benefit under a void or unenforceable contract, and who has subsequently spent
or used that benefit in a way that would make restitution unjust. The doctrine essentially
provides that if the party receiving the benefit has changed their position in good faith and
33
Lipkin Gorman v Karpnale Ltd, [1988] UKHL 12.
34
1978] 2 Lloyds Rep 233 (CA) (Clarke, LJ) (1981).

26
without any knowledge of the contract's invalidity, then restitution may be denied or
limited.35
43. The Supreme Court of India recognized the defence of change of position against
restitution. The court held that if a person has acted in good faith in reliance on a
transaction, it may be unjust to require that person to pay restitution.36
44. All the transactions were pursuant to the contract that was signed by Exchequer and
Exchequer had collected the premium periodically and the same had been spent by
Exchequer for the company’s development. Thus, clearly there has been a change of
position, and the restitution will only be detrimental to even the prior status quo that
Exchequer was having.
45. The same conclusion may be reached in cases of initial failure of consideration. Where the
basis of a transfer failed from the outset, for example, because it was transferred pursuant
to a void contract, and the Respondent was not aware of the failure at the time of irreversibly
changing his position, he may be able to bring himself within the defence provided that his
reliance was reasonable and no bars to the defence.
46. Referring to the ratio decidendi of the decision of the House of Lords in Sinclair v.
Broughams37, Lord Wright pointed out that the case turned upon the principle that it was
against public policy to allow the recovery of an ultra vires deposit, whether the claim be
based upon contract or quasi contract. The observations of their Lordships relating to the
foundation of quasi-contract were merely obiter dicta. Indeed, the House adopted the pan
passu distribution of the available assets as a technique to prevent the unjust enrichment of
the shareholders at the cost of the depositors.
47. The claimant’s representation may be explicit or implicit, by words or conduct. In order to
count against a claimant, the representation must be clear and unambiguous.38 Therefore,
the traditional position is that a mere payment does not, in and of itself, contain an implicit
representation that the Respondent is entitled to the payment. In general, it is only where
the claimant is under a duty of accuracy,39 or being aware of the Respondent’s mistake,
35
Satyabrata Ghose v. Mugneeram Bangur and Co, (1954) SCR 310
36
T.S. Swaminathaudayar vs The Official Receiver Of West Tanjore, 1957 AIR 577, 1957 SCR 775
37
[1914] AC 398
38
Low v Bouverie [1891] 3 Ch 82 (CA) 106, 113.
39
Skyring v Greenwood (1825) 4 B & C 281, 107 ER 1064 (KB).

27
comes under a duty to speak,40 that a representation will be implicit in the fact of the
payment.41
48. Similarly, the contention by Adornia is unmeritorious as there is no sufficient benefit

accrued by the Respondents. For a claim of restitution of unjust enrichment, it should pass
a three-fold test. One such element that has to be satisfied is that,
49. The other person for whom something is done or to whom something is delivered must
enjoy the benefit thereof. In the instant matter, Exchequer does not enjoy the benefit of the
money received as premium. Had the contract been valid, the same
4. IF THE EXCHEQUER CONTRACT IS NOT VOID:
A. IS ADORNIA, WITHOUT THE CONSENT OF THE SYNDICATE 41 INSURERS, ENTITLED
(WHETHER UNDER RULE 39.2 OF THE SIAC RULES OR OTHERWISE), TO REFER TO THE
CONTENTS OF THE SYNDICATE 41 AWARD?
50. The Respondent submits that the Claimants cannot rely on the Syndicate 41 award for the
reasons stated: (1) Syndicate 41 has explicitly refused to waive confidentiality, (2) there
exists no reasonable necessity for the invocation of Rule 39.2.
(1) Confidentiality has not been waived by Syndicate 41
51. Respondents submit that Syndicate 41 has, through notification sent, made it clear that they
would not consent to the use of the Syndicate 41 Award in the present arbitration, thus
invoking confidentiality as per Rule 39.1 of the SIAC.
52. The SIAC Rules make it abundantly clear that every arbitral proceeding is protected by
confidentiality.42 The principle of confidentiality is one that is corollary to the privacy of
arbitration proceedings.43
53. Claimants may regardless, argue that Syndicate 41 are estopped from waiving
confidentiality as the Respondents have been privy to the Syndicate 41 Arbitration from
40
The Indian Endurance (No 2) Republic of India v India Steamship Co Ltd, 1996] 3 All ER 641 (CA) 654–55
41
Elise Bant, The Change of Position defence (2009), Oxford and Portland, Oregon
42
Rule 39.1, SIAC.
43
Patrick Neill QC, Confidentiality in Arbitration, ARBITRATION INTERNATIONAL, Vol. 12, No. 3.

28
the beginning, and have also had the award disclosed to them.44 However, this argument is
without merit. It is submitted that the Respondents are not parties to the Syndicate 41
Arbitration, but instead, are merely participants to the proceedings. The same was not
contended by the Claimants as per the witness statements of Ms. Devika Ghosh.
54. A common understanding is that not only are arbitrations to be held in private, but that all
information concerning the arbitration, along with the decision finally rendered is to be
treated as strictly confidential.45 This duty of confidentiality is not solely on the Claimants
in the present dispute, but also imposed on the Respondents.
55. Non-parties who participate in an arbitration are also subject to confidentiality obligations.
Consequently, the joinder of non-parties does not contradict the 'primary aim of the
private nature of arbitration, which is not to make confidential material available to the
public at large'.46
(2) Reasonable necessity has not been laid out to justify disclosure.
56. The duty to maintain confidentiality can be discarded by the parties as per well decided
precedents of the English Courts47 on the grounds of: (i) consent, (ii) reasonable necessity
to protect an interest or claim and (iii) order of the court, (iv) leave of the court and, (v)
public necessity.48 This has also been incorporated in Rule 39.2. of the SIAC Rules, 2016.
57. Respondent submits that as per the SIAC Rules, confidentiality may be waived by the
parties to protect a legal right or claim.49 However, as per established findings of courts –
for confidentiality to be waived for the interest of protecting a legal right or claim by the
disclosing party, the Claimant must show reasonable necessity.50
44
Moot Prop. para 21.
45
Id. p. 301.
46
Nathalie Voser, Multi-party Disputes and Joinder of Third Parties, in Albert Jan van den Berg (ed.), 50 Years
of the New York Convention, ICCA Congress Series, Vol. 14 (Kluwer Law International 2009), p. 343.
47
Oxford Shipping Co. Ltd. V. Nippon Yusen Kaisha, (1984) 2 Lloyd’s rep. 373 (Q.B. Com. Ct.)
48
Ali Shipping v Shipyard Trogir [1998] 1 Lloyd’s Rep 643.
49
Rule 39.2.(c), SIAC.
50
Dolling-Baker v. Merrett & Another (CA 1990) [1991] 2 All ER 890

29
58. The test of “reasonable necessity” requires the party to show that it would be unavoidably
necessary for the party to violate confidentiality to protect a claim or legal interest that
could not be protected otherwise.51
59. Respondents submit that no such reason has been shown by the Claimant. The Syndicate
41 Award will be enforced regardless and no such right conferred by the Award can be
binding on this Tribunal, as the decisions of arbitral tribunals are not binding over
subsequent disputes.52
60. It is also pertinent to refer to the decisions of the English Courts in Hassneh Insurance Co.
v. Mew, where Colman J. held that it is insufficient for the Award to have a “commercially
persuasive impact” on the third party to whom they are disclosed.53 The mere commercial
benefit sought for by the Claimant is not capable of justifying disclosure of the Syndicate
41 Award.
61. In addition to this, the Claimants were given an opportunity to consolidate the proceedings
and refused to do so due to reasons known only to them.54 It is only fair that the principles
of the Institutional arbitration be followed to the dot as wished for by the Claimants.
B. IF SO, IS EXCHEQUER BOUND BY ISSUE ESTOPPEL BY THE SYNDICATE 41 TRIBUNAL’S

FINDINGS AS TO WHETHER THE LOSSES FOR WHICH ADORNIA WAS SEEKING AN INDEMNITY
FELL WITHIN THE INSURING CLAUSE?
62. It is submitted by the Respondents that they are not bound by issue estoppel to the findings
of the Syndicate 41 Tribunal on the question of whether the loss suffered by the Claimants
is covered by the insuring clause. This is due to the fact that the issue is governed by a
different law.
63. In furtherance of the said contention, the Respondent submits that for any successful plea
of issue estoppel, the primary requirements that need to be satisfied are that:
51
Hassneh Insurance Co. of Israel v. Mew [1993] 2 Lloyd's Rep. 243.
52
'9. Award', in Nigel Blackaby , Constantine Partasides, et al., Redfern and Hunter on International Arbitration
(Seventh Edition), 7th edition (© Kluwer Law International; Oxford University Press 2023)
53
Hassneh Insurance Co. v. Mew, p. 272, 275-276.
54

30
a. the same question must be in question in both proceedings,55
b. the determination of the issue must be necessary for the decision,56
c. the parties to the decision or their privies are identical to the parties to the
proceedings in which the estoppel is claimed or their privies.57
64. While prima facie reading of the above sub-sections would deceptively show that the
Respondents satisfy all the requirements, the same is untrue. Clause 17 of the Contract of
Insurance with Exchequer India Pvt. Ltd. which deals with the governing law of the
contract / policy states that: “This Policy shall be governed in all respects by Indian law,
save that the arbitration agreement in clause 18 below shall be governed by English
law”.58
65. Meanwhile, Clause 23 of the Contract of Insurance with Syndicate 41 clearly states: “This
Policy shall be governed in all respects by English law”.59
66. The Respondents submit that they cannot be estopped from dealing with this issue in the
present arbitration as the findings of the tribunal in the previous dispute is one which was
on the basis of English Law. The present dispute is to be determined under Indian Law. It
is hence necessary for the arbitral tribunal to re-hear this issue as not doing so would be a
violation of the principle of natural justice, specifically the principle of audi alteram
partem.
67. The present case is one of special circumstance where the principle of issue estoppel would
generally arise, however, taking up the said plea would work against the interests of justice,
equity and good conscience. The Courts have also acceded to this notion, as was in the case
of Arnold v. National Westminster Bank plc,60
“…there may be an exception to issue estoppel in the special circumstance that there has
become available to a party further material relevant to the correct determination of a
55
Thoday v. Thoday, [1964] 2 WLR 371.
56
Spencer Bower & Handley, para. 8.23
57
Fidelitas Shipping Co. Ltd. v VO Exportchleb, [1965] 2 WLR 1059 ; See also, Halsbury's Laws of England,
vol. 16, para. 977.
58
Moot Prop. Annexure 3, cl. 17.
59
60
Arnold v National Westminster Bank plc [1991] 2 AC 93, 109

31
point involved in the earlier proceedings, whether or not that point was specifically raised
and decided, being material, which could not by reasonable diligence have been adduced
in those proceedings. One of the purposes of estoppel being to work justice between the
parties, it is open to courts to recognise that in special circumstances inflexible application
of it may have the opposite result...”61
68. The Respondents hence submit that for the proper and fair consideration of the dispute, the
plea of issue estoppel by the Claimant be rejected for the aforementioned reasons.
C. IF NOT, DO THOSE LOSSES IN FACT FALL WITHIN THE INSURING CLAUSE?
69. Respondent submits that the losses suffered by the Claimants do not fall within the terms
of the Insurance clause,62 for the reasons stated: (1) The interruption is outside the terms of
the business interruption clause and (2) the policy should be read in its ordinary meaning.
70. It is submitted that the insurance policy should be construed in the manner that it was
intended for by the parties. The construction of a contract should be read in their ordinary
meaning and not be widely interpreted.
(1) The Provisions of the Contract must be read in their ordinary meaning
71. While construing the terms of the contract, the original terms of the contract can never be
substituted by venturing into extra liberalism which will the damage the very essence of
the terms of the policy. It would virtually result in re-writing of the contract if it is
interpreted in a way that is not intended by the parties.63
72. It is reverently submitted that terms of the said clauses must be strictly construed, in a
manner that was initially intended by the parties to the contract which determines the extent
of liability of the insurer.64
73. It is to be noted that the provisions of an insurance contract must be imparted a reasonable
business like meaning bearing in mind the intention conveyed by the words used in the
61
Carl Zeiss Stiftung v Rayner and Keeler Ltd [1967] 1 AC 853, p. 947.
62
63
Vikram Greentech India Ltd. v. New India Assurance Co. Ltd., (2009) 5 SCC 599.
64
General Assurance Society Ltd. v. Chandumull Jain AIR 1966 SC 1644, United India Insurance Co. Ltd. Vs.
Harchand Rai Chandan Lal (2004) 8 SCC 644.

32
policy document. The court must interpret the words in which the contract is expressed by
the parties and not embark upon making a new contract for the parties.65
74. Further, it has been clearly laid down that the principle of Contra Proferentem should not
be invoked in the absence of ambiguity in the clauses of the policy. Essentially, the presence
of ambiguity in the language of policy is a sine qua non for invoking the contra proferentem
rule.66
(2) The interruption is outside the terms of the business interruption clause:
75. The insuring clause clearly prescribes that the claimant would only be indemnified against
damage, destruction or physical loss to the property. It is followed by a business
interruption clause which lays down that if the business is interrupted as a consequence of
such damage, the loss resulting from such interruption will also be indemnified.67
76. The claims for business interruption can only arise if it is in consequence of an admissible
material damage under the policy. It is of much pertinence to note that the Governmental
Authority in India even came up with a Policy Advisory saying Business interruption losses
arising out of COVID-19 lockdowns aren’t admissible.68
77. The restrictions that were imposed by the public authorities during the pandemic would
rarely have caused physical damage to the property, thus the interruption clause could not
be triggered in that scenario. The restrictions during COVID are of the nature of
governmental intervention as is the case in the instant matter.
78. Clause 12 of the contract manifestly lays that only if the insured’s business is interfered as
a consequence of the damage against the property, the insurer will indemnify the amount
of the loss resulting from such interruption.69
65
Bajaj Allianz General Insurance v. The State of Madhya Pradesh, C.A. No.-002366-002367 / 2020, Suraj Mal
Ram Niwas Mills Pvt. Ltd v. United India Ins. Co. Ltd, C.A. No. 1375 / 2003.
66
United India Insurance Company Limited v M/s Orient Treasures Private Limited, (2016) 3 SCC 49.
67
68
Public Advisory dated April 21, 2020 issued by the General Insurance Council, available at
http://www.gicouncil.in/gi-council-public-advisory/
69

33
PRAYER
Therefore, in light of the facts stated, issues raised, authorities cited and arguments advanced,
the Counsel for the RESPONDENT respectfully requests the Tribunal to adjudge and declare
that:
1) The Claimants are restrained from referring to the Syndicate 41 Award.
2) The plea of issue estoppel be rejected.
3) If the Exchequer Contract is not void for want of capacity, then the losses accrued by
the Claimants do not come under the Insuring clause and the Business interruption
clause of the Insurance Policy.
4) If the Exchequer Contract is void for want of capacity, the Respondents are not unjustly
enriched.

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XVI NLSTIAM, 2023

ADORNIA LTD CLAIMANT

EXCHEQUER INSURANCE PVT LTD. RESPONDENT

SEAT OF ARBITRATION: LONDON, UNITED KINGDOM

WRITTEN SUBMISSION ON BEHALF OF THE RESPONDENTS

TABLE OF ABBREVIATIONS ............................................................................................... 3

A. Necessity for the rules of choice of law and jurisdiction .......................................... 17

WRITTEN SUBMISSION FOR RESPONDENTS

AIR ALL INDIA REPORTER

WRITTEN SUBMISSION FOR RESPONDENTS

SCC SUPREME COURT CASES

SCR SUPREME COURT REPORTER

SIAC SINGAPORE INTERNATIONAL ARBITRATION

WRITTEN SUBMISSION FOR RESPONDENTS

S.NO NAME CITATION PARA

1. Bajaj Allianz General Insurance v. The State C.A. No.-002366-002367 73

2. Bharat Aluminium Co. v. Kaiser Aluminium (2016) 4 SCC 126 13

3. General Assurance Society Ltd. v. AIR 1966 SC 1644 72

4. Kuwait Airways Co. v. Iraqi Airways Co AIR 1963 SC 1. 5

5. Official Administrator v. Anba Bola Convent (1900-1931) 1 SLR 521 1

6. Reliance Industries Ltd. v. Union of India (2014) 7 SCC 603 14

7. Sakuma Exports Limited vs Louis Dreyfus 2013 (6) BomCR 218 12

8. Satyabrata Ghose v. Mugneeram Bangur and (1954) SCR 310 42

WRITTEN SUBMISSION FOR RESPONDENTS

S.NO NAME CITATION PARA

12. Ali Shipping v Shipyard Trogir [1998] 1 Lloyd’s Rep 56

13. Arnold v National Westminster Bank plc [1991] 2 AC 93 67

14. Baindail v. Baindail [1946] 1 All ER 342 26

15. Bayerisches Oberstes Landesgericht 46 [WM] 1371 (1992). 17

16. Bertonneau v. Southern Pacific Co. 120 Pac. 53 (1911). 16

17. Bodley Head Ltd. v. Flegon [1972] 1 WLR 680. 28

18. Burr v. Beckler 106 N. E. 206 (1914) 8

20. Charron v. Montreal Trust Co (1958) 15 DLR (2d) 240. 27

21. Dolling-Baker v. Merrett & Another [1991] 2 All ER 890 57

22. Fidelitas Shipping Co. Ltd. v VO [1965] 2 WLR 1059 63

24. Gienar v. Meyer (1796) 2 Hy. B1. 603 22

25. Hassneh Insurance Co. of Israel v. Mew [1993] 2 Lloyd's Rep. 58

26. Lipkin Gorman v Karpnale Ltd. [1988] UKHL 12. 36

27. Low v Bouverie [1891] 3 Ch 82 (CA) 47

WRITTEN SUBMISSION FOR RESPONDENTS

28. Mayer v. Roche 75 Atl. 235 (1909). 7

29. Mount Albert Borough Council v. (1937) 4 All E.R. 206 21

31. Poole v. Perkins 101 S. E. 240 (1919) 7

32. Sinclair v. Broughams [1914] AC 398 46

33. Skyring v Greenwood 107 ER 1064 (KB) 47

34. The Indian Endurance (No 2) Republic of [1996] 3 All ER 641 47

35. Thoday v. Thoday [1964] 2 WLR 371 63

36. Union National Bank v. Chapman 169 N. Y. 538 8

37. Union Trust Co. v. Knabe 89 Atl. 1106 (1914) 8

S.NO NAME OF THE STATUTE OR THE LAW REFERRED

BOOKS AND ARTICLES:

S. NO. NAME OF BOOK / ARTICLE.

1. 2 BEALE, A TREATISE OF THE CONFLICT OF LAWS (1936) § 332

WRITTEN SUBMISSION FOR RESPONDENTS

2. '9. Award', in Nigel Blackaby, Constantine Partasides, et al., Redfern and

3. Bernhard Grossfeld, Commentary, in JULIUS VON STAUDINGER,

4. BRIGGS, ADRIAN, ET AL. DICEY, MORRIS AND COLLINS ON THE

5. Brown AC, “Presumption meets reality: an exploration of the confidentiality

6. David Gwynn Morgan: “The Retrospective Dimension of the 2002-03