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Caml Ghana Limited v. Westchester Resources Limited

United States District Court, S.D. New York

January 30, 2015

CAML GHANA LIMITED, RATEL GROUP LIMITED, CGA MINING LIMITED, and CENTRAL ASIA MINERALS LIMITED, Plaintiffs,
v.
WESTCHESTER RESOURCES LIMITED, Defendant.

OPINION & ORDER

PAUL A. ENGELMAYER, District Judge.

This case arises out of a joint venture between CAML Ghana Limited ("CAML Ghana") and Westchester Resources Limited ("Westchester") to prospect for gold on a plot of land (the "Tenement") in the Ashanti Gold Belt in Ghana. After relations between CAML Ghana and Westchester broke down, CAML Ghana brought claims to arbitration in London, pursuant to an arbitration clause in the parties' agreement. Soon after, Westchester filed suit in court in Ghana, arguing that its claims of fraud were not arbitrable under Ghanaian law, which governs the parties' agreement. CAML Ghana prevailed in the arbitration, and then petitioned this Court to confirm the arbitral award; Westchester challenged the petition on various grounds. After a period of active litigation, the parties resolved that dispute through a stipulation, which this Court so-ordered.

Now pending before the Court is CAML Ghana's motion to enforce this Court's stipulation and order. The parties' dispute turns on the interpretation of that stipulation and order, namely, whether Westchester's agreement to dismiss the Ghana litigation covers litigation against certain third parties or only against CAML Ghana. For the following reasons, the Court finds CAML Ghana's interpretation of the stipulation and order clearly correct and grants the motion to enforce.

I. Background[1]

A. The Joint Venture Agreement

In 2008, CAML Ghana and Westchester entered into a Joint Venture Agreement ("JVA") to conduct exploration and mine for gold. Caruso Decl. ¶ 2. Under the JVA, CAML Ghana agreed to assess the feasibility of gold-mining in the Tenement and to make certain payments. Dkt. 9, Ex. 1-A ("JVA"), at § 3. Westchester, for its part, agreed to transfer a 51% interest in the Tenement to CAML Ghana. JVA § 4.1(c). The agreement states that "any dispute arising out of or in connection with this Agreement... may be referred by a party to arbitration, " which "shall be conducted in accordance with the Rules of the London Court of International Arbitration (LCIA)" and, "[u]nless otherwise agreed by all parties[, ]... shall be held in London, England." JVA §§ 17.1, 17.4. The agreement is governed by the laws of Ghana. JVA § 20.9.

B. The Arbitration and the Ghana Litigation

In March 2011, Westchester challenged whether CAML Ghana had satisfied the requirements to acquire the 51% interest in the Tenement. Caruso Decl. ¶ 4. To resolve this dispute, CAML Ghana initiated arbitration in London, while Westchester commenced litigation in Ghana. Id. ¶¶ 5-6. The relevant history of each action is briefly summarized below.

First, on November 3, 2011, CAML Ghana filed a request for arbitration with the LCIA. Id. 5. Although Westchester initially participated in the arbitration, see id., it later challenged the jurisdiction of the arbitral tribunal, arguing that fraud claims it had asserted were outside the scope of the JVA's arbitration clause, id. ¶ 7. The tribunal rejected Westchester's jurisdictional challenge and held that Westchester had breached the JVA by initiating the Ghana litigation; it therefore ordered Westchester to terminate that litigation. Id. Westchester refused to comply with the tribunal's interim order and formally withdrew from the arbitration. Id. ¶¶ 7-8.

On July 29, 2013, the arbitral tribunal held a final hearing on the merits. Id. ¶ 18. Westchester did not participate. Id. On September 26, 2013, the tribunal issued its Award, ruling in favor of CAML Ghana on all claims. Id. ¶ 19. The Award granted CAML Ghana, among other remedies, declaratory relief establishing that CAML Ghana held the 51% interest in the Tenement and dismissing all of Westchester's counterclaims. Id.

Second, on December 15, 2011, several weeks after CAML Ghana had initiated the arbitration, Westchester commenced the Ghana litigation by bringing suit in the Superior Court of Judicature in the High Court of Justice in Accra, Ghana (the "Ghana Court") against CAML Ghana, associated entities, [2] and another company, St. Augustine Gold & Copper Ltd. ("St. Augustine"). Id. 6. Westchester brought claims for breach of contract and fraud. Id.

The Ghana Court initially stayed the Ghana litigation, with the consent of all parties, pending resolution of the arbitration. Id. After withdrawing from the arbitration, however, Westchester moved to set aside the stay. Id. ¶ 9. On November 27, 2012, the Ghana Court granted Westchester's motion, and litigation resumed. Id. CAML Ghana filed an interlocutory appeal challenging the decision to lift the stay; on February 12, 2013, the Ghana Court issued another stay of the Ghana litigation pending resolution of that appeal. Id. ¶ 12. The appeal was still pending when the arbitral tribunal issued its Award on July 29, 2013. See id.

On December 12, 2012, during the brief interlude between the two stays of the Ghana litigation, Westchester moved there to join the Portland House Group Limited and Portland House Investments Limited (collectively, the "Portland Companies") as additional defendants. Id. ¶ 13. Westchester claimed that the Portland Companies held certain collateral, which Westchester could use to execute a judgment in its favor in the Ghana litigation. Id. Ex. 3, at 10-12. The Ghana Court granted Westchester leave to serve the motion for joinder outside the jurisdiction and denied the Portland Companies' motion to set aside that order. Id. ¶ 16. The Portland Companies then filed an interlocutory appeal challenging the Ghana ...


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