Security for claims in arbitration
This chapter considers security for claims advanced in London maritime arbitrations. It focuses on two main areas: freezing injunctions and ship arrests. In practice, of course, security is often dealt with by agreement by the insurer or Club funding the arbitration proceedings, often against the background of the threat of arrest of vessels. Nevertheless, it may become necessary to apply to court in order to properly secure a claim. The claimant will almost invariably be required, as a condition of the grant of a freezing injunction, to offer an undertaking to compensate the respondent in damages for any loss caused by complying with the order. If the applicant has not yet commenced arbitration proceedings, an undertaking to do so immediately may be required. Where, however, arrest proceedings are commenced with the ulterior purpose of forcing a party from relinquishing rights under an arbitration clause, they will amount to a breach of the arbitration clause.