Key takeaways
Governing law of arbitration agreement
Must be considered separately to governing law of underlying agreement.
Express governing law
Express choice of governing law will prevail over arguments of suitable forum.
Agreement to arbitrate
Court will honour this and grant an anti-suit injunction where appropriate.
Chubb Bermuda Insurance Ltd -v- Fertita Entertainment Inc & others [2026] EWHC 1392 (Comm)
In an insurance dispute arising out of claims for losses sustained during the Covid-19 pandemic, the English Court has dismissed arguments that the arbitration agreement in the insurance policy was invalid under Louisiana law. The arbitration provision in the policy expressly stated that all matters relating to the existence of the arbitration agreement were governed by English law. Therefore, Louisiana law was irrelevant in this respect.
The Court noted the insureds’ position that the insurer was Bermudan, the insured were all US companies and the policies covered only US risks and losses. Nonetheless, the arbitration agreement was governed by the system of law the parties had agreed would govern it, namely English law.
The background facts
The parties
The claimant, Chubb Bermuda Insurance Ltd (Chubb), is incorporated in Bermuda. The defendants are associated corporations, whose businesses are primarily focused in the hospitality sector in different locations across the USA, including Louisiana and Texas.
The Policy
Chubb issued a Property Insurance Policy (Policy) with an effective period of 31 May 2019 to 31 May 2020. The Named Insured was the first defendant, Fertita Entertainment Inc, but the definition of the Insured encompassed all seventeen of the defendants.
The Policy was recorded as issued in Hamilton, Bermuda. The Policy’s General Provisions incorporated an arbitration clause, clause 2, that provided for London arbitration and for all matters relating to the existence of the arbitration agreement and the selection of arbitrators to be governed by English law.
Clause 3, Governing Law and Interpretation, provided for New York (NY) law, except insofar as NY law was inconsistent with any provisions of the Policy, in which case English law would apply.
The dispute
In early July 2020, a number of the defendants issued proceedings against their excess insurers, including Chubb, in the Louisiana courts (1st Louisiana proceedings) seeking business interruption coverage for the relevant period in respect of losses sustained due to the Covid-19 pandemic. These proceedings were subsequently dismissed without prejudice to all the defendants, including Chubb.
Later in July 2020, the first to twelfth defendants, as plaintiffs, filed a set of proceedings in Louisiana against various insurers, and the first to seventeenth defendants, as plaintiffs, filed another set of proceedings in Louisiana against various insurers (2nd Louisiana proceedings). The complaints were similar, namely that the insurers had denied coverage and the plaintiffs sought various declarations and damages. Chubb was not named as a defendant in either set of proceedings but, in January 2025, the plaintiffs in the 2nd Louisiana proceedings sought to add Chubb as a defendant to those proceedings.
As a result, in January 2025, Chubb sought and obtained an interim anti-suit injunction (ASI) from the English Court, prohibiting the defendants from pursuing or taking any further steps in the 2nd Louisiana proceedings. The interim ASI was subsequently continued by agreement to allow settlement discussions to take place. After no settlement was reached, Chubb sought a final ASI and the defendants applied to challenge the jurisdiction of the English Court and to have the interim ASI set aside.
The defendants also sought and obtained a temporary restraining order (TRO) from the Louisiana Court in the 2nd Louisiana proceedings, which restrained Chubb from pursuing the English court proceedings or from commencing arbitration in relation to any dispute under the Policy. The defendants accepted that their actions were in breach of the interim ASI but maintained their position that the English Court had no jurisdiction. The defendants also obtained a preliminary injunction from the Louisiana Court restraining Chubb from pursuing the English Court proceedings.
Chubb succeeded in getting the Louisiana preliminary injunction set aside by the US Court of Appeals for the Fifth Circuit (Fifth Circuit) and the case against Chubb was dismissed for lack of jurisdiction.
Nonetheless, in February 2026, the defendants commenced new proceedings against Chubb (3rd Louisiana proceedings), arguing that the arbitration agreement in the Policy was contrary to Louisiana law and that Chubb had waived its right to invoke the arbitration provision in the Policy by choosing to litigate in the English Court.
In March 2026, the defendants sought a declaratory judgment in the 3rd Louisiana proceedings and an injunction to restrain Chubb from pursuing the English Court proceedings. The Louisiana Court found in Chubb’s favour and dismissed the proceedings. The defendants sought to appeal to the Fifth Circuit and the appeal remains pending.
Chubb then amended its claim in the English Court to include a claim for damages for breach of the arbitration agreement in the Policy. Prior to the hearing for a final ASI, the defendants’ lawyers indicated that their clients did not intend to attend any hearing, nor to be represented, but continued to challenge the English Court’s jurisdiction and entirely reserved their rights regarding the proceedings generally, including any final ASI.
The hearing, therefore, took place without any further participation by the defendants.
The Commercial Court decision
The Court considered the three bases on which the defendants had sought to challenge English jurisdiction:
The arbitration agreement was invalid pursuant to Louisiana law, by reason of Louisiana statutory provisions.
There was no connection to England, and the defendants had not submitted to the English Court’s jurisdiction.
Louisiana was the most suitable forum.
As to 1, the Court considered the principles set out in Enka Insaat ve Sanayi AS -v- OOO Insurance Company Chubb [2020] UKSC 38, as summarised in UniCredit Bank GmbH -v- RusChemAlliance LLC [2024] UKSC 30:
’… the arbitration agreement is governed by whichever system of law the parties have agreed will govern it or, in the absence of such an agreement, the system of law with which the arbitration agreement is most closely connected. Whether the parties have agreed on a choice of law to govern the arbitration agreement is ascertained by construing the arbitration agreement and the contract containing it, as a whole, applying the rules of contractual interpretation of English law as the law of the forum.’
In this Policy, General Provision 2 expressly stated that all matters relating to the existence of the arbitration agreement were to be determined by English law. Louisiana law was therefore irrelevant to the forum for the dispute. This conclusion made points 2 and 3 irrelevant.
The defendants’ challenge to jurisdiction was, therefore, dismissed. There was a valid arbitration agreement in existence, whose scope extended to all matters that the defendants sought to litigate in the Louisiana Court. The defendants had not put forward sufficiently strong relief to justify refusing a final ASI. That the disputes might be more closely connected to Louisiana was not a strong reason for these purposes. Arbitration and jurisdiction clauses were often agreed precisely because the chosen forum had nothing to do with the parties or their affairs, and to give overriding weight to forum conveniens would defeat the intention of the parties.
The ASI relief included a mandatory injunction requiring the defendants to procure the dismissal of the claims brought in the 3rd Louisiana proceedings. The Court also awarded Chubb damages in respect of the costs they incurred in resisting the 2nd Louisiana proceedings, as well as an indemnity for future US legal costs.
Comment
The decision highlights how the governing law of an arbitration agreement may be considered separately to the governing law of the underlying contract, in this case the Policy.
It also illustrates the importance placed by the English Court of honouring parties’ agreements to arbitrate, exercising its discretion to issue interim and final ASIs where appropriate.
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