The Application for Interim Relief Under Section 11A of the Grand Court Act (2015 Revision) and Section 54 of the Arbitration Act, 2012 Between Minsheng Vocational Education Company Ltd Appellant v (1) Leed Education Holding Ltd (2) National Education Holding Ltd (3) Hyde Education Holding Ltd Respondents

• Jurisdiction: Cayman Islands
• Judge: Mr Justice Segal
• Judgment Date: 31 August 2023
• Docket Number: CAUSE NO: FSD 130 OF 2023 (NSJ)
• Court: Grand Court (Cayman Islands)

In the Matter of the Application for Interim Relief Under Section 11A of the Grand Court Act (2015 Revision) and Section 54 of the Arbitration Act, 2012

Between

Minsheng Vocational Education Company Limited

Appellant

and

(1) Leed Education Holding Limited

(2) National Education Holding Limited

(3) Hyde Education Holding Limited

Respondents

The Hon. Mr Justice Segal

CAUSE NO: FSD 130 OF 2023 (NSJ)

IN THE GRAND COURT OF THE CAYMAN ISLANDS

FINANCIAL SERVICES DIVISION

DECISION ON NEED AND APPLICATION FOR LEAVE TO APPEAL

1 On 3 August 2023 I handed down judgment (the Judgment) on an originating summons (the Originating Summons) filed by the Respondents in which they applied for an injunction pursuant to section 11A of the Grand Court Act (2015 Revision) ( Section 11A) and to section 54 of the Arbitration Act 2012 ( Section 54). As I noted in the Judgment, while the Originating Summons referred both to Section 11A and Section 54 during the hearing it became apparent that the Respondents' claim to injunctive relief was based wholly on Section 54. In the Judgment I concluded that it was appropriate to grant the Respondents' application for such an injunction but to do so subject to certain qualifications and conditions. The injunction (the Injunction) and these conditions have now been set out in the form of order made to give effect to the Judgment. I adopt for the purpose of this decision the terms defined in the Judgment.

2 The Appellant has indicated that it wishes and intends to appeal the Judgment “ given the relative novelty of the Section 54 jurisdiction in the Cayman Islands”. The Appellant submits that it does not require leave to appeal as it has an appeal as of right in respect of an injunction granted pursuant to Section 54 (and/or a section 11A). In the alternative, if leave is required, the Appellant seeks leave to appeal.

3 The Appellant indicated that it wished to appeal the Judgment prior to the final form of the Judgment being approved and handed down and, in accordance with the directions I had given, set out its position in its Skeleton Argument on Consequential Matters dated 4 August 2023 (the Skeleton Argument). In so far as the Skeleton Argument set out the grounds for the Appellant's application for leave, I have treated the Appellant's application as having been made at the time that the Judgment was pronounced for the purpose of rule 11(5) of the Court of Appeal Rules (2014 Revision).

4 The Respondents have not made submissions on the Appellant's application regarding an appeal as they consider that such an application is essentially an ex parte process in which their only role is to ensure that the Court is not misled as to matters raised in the application. It is clear that respondents are not required to take any steps in response to an application for leave to appeal or in relation to an appeal although they could make written submissions on whether the grounds for granting leave are made out if they wished to do so. The Respondents have, however, chosen not to do so.

5 As regards the question of whether leave to appeal is needed, I agree with the Appellant that it is not. I agree that the decision (and the order) made on the Originating Summons is not an interlocutory judgment for the purpose of section 6(f) of the Court of Appeal Act (2023 Revision). It is to be treated as a final order for appeal purposes.

6 Section 54 gives the Court “ the same power of issuing an interim measure in relation to arbitration proceedings …. as it has in relation to the proceedings in court.” The relief granted by the Court is “ interim” because it regulates the position of the parties to the arbitration before the conclusion of the arbitration. An order made in exercise of the Section 54 jurisdiction is ancillary to and in aid of the arbitration. But such an order finally determines the proceedings and the dispute in this jurisdiction. The test for a final order set out in rule 12(3) of the Court of Appeal Rules is satisfied (“ A judgment or order shall be treated as final if the entire cause or matter would (subject only to any possible appeal) have been finally determined whichever way the court below had decided the issues before it”). It seems to me that the dicta from Justice Kawaley's judgment in AncelorMittal North America Holdings LLC v Essar Global Fund Limited [ 2021 (2) CILR 673] cited by the Appellant support this conclusion.

7 However, if leave to appeal is needed I would grant permission in this case.

8 In the Skeleton Argument the Appellant noted that (a) the general test for whether leave to appeal should be granted was whether the intended appeal had a real prospect of success; (b) “ real” had been held to mean a “ realistic” as opposed to “ fanciful” prospect of success (this Court has consistently applied the dicta of Lord Woolf MR in Swain v Hillman [2001] 1 All ER 91) and (c) in exceptional circumstances, leave may be granted even though there was no real prospect of success if the appeal concerned an issue of great public interest or importance which should be examined by the Court of Appeal. The Appellant cited in support of these propositions the note of the judgment of Sanderson J in Telesystem International Wireless and Ors v CVC/Opportunity Equity Partners reported at [ 2001 CILR Note 21] and the judgment of Justice Quin in ( Embassy Investments v Houston Casualty Company unreported, 3 July 2012).

9 In the Skeleton Argument the Appellant set out four grounds of appeal:

• (a). the Respondents had failed to establish the need for relief under Section 54: there was an insufficient basis for exercising the Section 54 jurisdiction since the Respondents had failed to demonstrate that it was necessary to grant an order and no attempt had been made to approach the HKIAC arbitral tribunal or the CIETAC arbitral commission or CIETAC arbitral tribunal or the supervisory courts for relief and no evidence was given by the Respondents to explain the failure. Since the Appellant was a party and therefore amenable to orders from the arbitral tribunal or the relevant supervisory courts such orders would have been directly enforced if made.

• (b). relief under Section 54 was unavailable since the Appellant's right to enforce the Share Charges was a matter which was subject to the jurisdiction of this Court and outside any relief that could be given in the foreign arbitrations: the question for the Court was whether the jurisdiction clause in the Share Charges prevented the arbitral tribunals from making awards in relation to the...