… the award cannot be enforced on terms not specified in the award. … In particular, an award can only be enforced against a losing party in the arbitration. The party successful in the arbitration is not, therefore, entitled to seek enforcement of the award against another person who is alleged in the enforcement proceedings to be the principal of the losing party in the arbitration. … [emphasis added in italics]
(a) First, the Judge found that the Tribunal intended to and did issue the Award in favour of Hydralift and not NOV Norway (GD at [30]). Applying s 19 of the IAA and applying the mechanical approach to enforcement, the court would not be enforcing the Award in the same manner as a judgment to the same effect if it were to allow the enforcement application (GD at [51]–[56]).
(b) Second, the Judge found that the use of Hydralift was not a mere misnomer because both parties objectively intended to use Hydralift's name to refer only to Hydralift and not to NOV Norway (GD at [94], [118] and [134]). Thus, the arbitration and the Award were a nullity from the outset. In any event, a misnomer can only be corrected by taking the appropriate steps in the arbitration and this had not been done (GD at [67]–[68] and [145]).
(c) Third, the Judge found that NOV Norway was estopped by its representations in the arbitration and in the related litigation from denying that Hydralift (rather than itself) was the respondent in the arbitration. In reliance on those representations, KFELS spent substantial time and expense over 12 years prosecuting the claim and defending the counterclaim in the arbitration (GD at [150]–[151]).
(a) First, the Judge erred in adopting an excessively mechanical and rigid approach to s 19 of the IAA. Section 19 should be read to allow the court to give "effect" to the true state of affairs where one of the parties has been misnamed. In this case, NOV Norway is, in substance, the true respondent to the arbitration. Indeed, NOV Norway is the only possible respondent in the arbitration since it has succeeded Hydralift which no longer exists as a separate legal personality. In line with this, NOV Norway has participated in the arbitration for 12 years.
(b) Second, the intended respondent to the arbitration was NOV Norway and not Hydralift. This is what makes this a case of a mere misnomer. In determining whether a case is indeed one of a misnomer, the test should be to ask who the party receiving the notice of arbitration (here NOV Norway) would reasonably have understood to be the party intended to be sued. It would have been clear to NOV Norway that it was the intended respondent despite KFELS having named Hydralift as the respondent in the arbitration because NOV Norway had succeeded to all the rights and obligations of Hydralift. The Judge also erred in holding that a misnomer can only be corrected within the arbitration since this is not a mandatory or necessary step in order to validate the arbitration.
(c) Third, no estoppel could arise since KFELS would have continued with the arbitration had it known of the true state of affairs before the commencement of the arbitration. In any case, since the Award was in NOV Norway's favour, KFELS' reliance on any representations by NOV Norway did not cause it any detriment.
(d) Finally, NOV Norway relies on the Judge's holding that cl 21.1 does not prohibit the transfer of rights under the Contract from Hydralift to NOV Norway.
(a) First, the Judge rightly found that to grant leave to NOV Norway to enforce the Award would be to assume a power to enforce an award that the Tribunal never intended to issue, had no reason to issue and did not in fact issue. The Judge's application of the mechanical approach followed and implemented the Tribunal's intent as manifest in its Award. Further, it was NOV Norway, who could have, but did not apprise the Tribunal of the true state of affairs.
(b) Second, in any event, the Judge was correct to find that the arbitration and the Award are a nullity since the respondent in the arbitration, Hydralift, did not exist from the arbitration's inception. The naming of Hydralift could not have been a misnomer or a simple mistake as to the name of the intended respondent since both KFELS and NOV Norway objectively regarded Hydralift as the respondent in the arbitration. Even if the naming of Hydralift was a misnomer, the Tribunal alone could correct that within the arbitration and this was not sought or done.
(c) Third, the Judge rightly found that NOV Norway was estopped by its undisputed representations in the arbitration and in the related litigation from denying that Hydralift was the respondent in the arbitration. Aside from the time and expense incurred in proceeding with the arbitration, KFELS also lost the chance to commence fresh proceedings against NOV Norway before another forum, defend the counterclaim in the arbitration on the basis that it was brought by a non-existent entity and undermine the credibility of NOV Norway's factual witness in the arbitration.
(d) Fourth, KFELS argues that the Judge erred in finding that cl 21.1 of the Contract did not prevent Hydralift from transferring its substantive rights thereunder to NOV Norway. Since cl 21.1 prohibits Hydralift from "assign[ing] the contract or any part thereof or any benefit interest [sic] therein or thereunder", Hydralift could not have transferred its rights to NOV Norway through the 2004 mergers. Thus, there was no arbitration agreement between NOV Norway and KFELS and enforcement ought also to be refused on this basis.
(a) What is the effect of the 2004 mergers under Norwegian law?
(b) Does cl 21.1 of the Contract prohibit the transmission of Hydralift's rights under the arbitration agreement to NOV Norway?
(c) Does the court have the power to enforce an arbitral award where a party to the arbitration has been named incorrectly and, if so, should it enforce the Award?
(d) Is NOV Norway estopped by its representations from denying that the respondent in the arbitration was Hydralift?
We deal with these in turn.
Effect of amalgamations
215G. On the date shown in a notice of amalgamation —
(a) the amalgamation is effective;
(b) the amalgamated company has the name specified in the amalgamation proposal;
(c) all the property, rights and privileges of each of the amalgamating companies are transferred to and vest in the amalgamated company;
(d) all the liabilities and obligations of each of the amalgamating companies are transferred to and become the liabilities and obligations of the amalgamated company;
(e) all proceedings pending by or against any amalgamating company may be continued by or against the amalgamated company;
(f) any conviction, ruling, order or judgment in favour of or against an amalgamating company may be enforced by or against the amalgamated company; and
(g) the shares and rights of the members in the amalgamating companies are converted into the shares and rights provided for in the amalgamation proposal.
(a) In the case of what was described as an absorption-type merger, two or more companies will merge to form one company. One of the entities, which is designated the "surviving company", inherits all the rights and obligations of the absorbed company (or companies, as the case may be), which ceases to exist from the date of the merger. In this situation, because all the rights and obligations of the absorbed entities are transferred to the surviving companies, there is no need to specify in the merger agreement the rights and obligations which are to be transferred.
(b) In the case of what was described as an incorporation-type company split, all or a part of the obligations of the "splitting company" will be hived off and transferred to a newly-incorporated entity. The original company ("the splitting company") will continue to exist in an attenuated form and will hold the rights and obligations not transferred. The rights and obligations to be transferred must be specified in a "split plan", which is to be prepared by the splitting company prior to the split.
(c) In the case of what was described as an absorption-type company split, the "splitting company" likewise transfers some of its rights and obligations to another company, except in this case, the company which receives it is an existing company (known as the "succeeding company"). This is why it is an "absorption" and not an "incorporation". The splitting company will continue to exist and will hold all rights and obligations not absorbed by the succeeding company. The rights and obligations which are to be absorbed must be specified in the split agreement between the splitting company and the succeeding company.
...
(c) In some cases, the law of incorporation might recognise that an entity has the status of a 'universal successor'. What is usually meant by this is that the entity is seen as having inherited the legal personality of another company, with the attendant consequence that it inherits all the assets and liabilities of its predecessor. This process does not necessarily entail that there is a continuity of legal personality between the old and new entities; the process can be discontinuous, but the 'essence of the transaction' is that the new entity has taken on either the whole or a part of both the assets and liabilities of its predecessor(s).
[emphasis in original omitted; emphasis added in italics and bold italics]
… This conception, as expounded in the evidence in this case, is common to other legal systems which have borrowed from the Roman law. Used generally with reference to an heir who takes up a succession on death, it carries with it a liability on the heir to the deceased's creditors for the deceased's debts. From this aspect he represents the deceased. The persona of the deceased is regarded as continued in the heir, or, as it is otherwise expressed, he is eadem persona cum defuncto. He is no more to be regarded as a new party introduced into a contract than is an executor or administrator of a dead man's estate in English law …
The extinction of a corporation under statute or decree and the passing of all its rights and liabilities to a successor exhibits, in my view, all the features of a universal succession. It may not generally be so regarded, but the consequences appear to me to be in many respects indistinguishable …
[emphasis added in italics and bold italics]
38 The next case is the decision of the English High Court in Centro Latino Americano de Commercio Exterior SA v Owners of the Ship 'Kommunar' (The 'Kommunar' (No 2)) [1997] 1 Lloyd's Rep 8 ('The Kommunar (No 2)'), which concerned the arrest of a vessel off the coast of Falmouth in 1995. The owner of the vessel was a Russian corporation, AOL, and the arrest had been made pursuant to certain debts which arose in relation to services provided to POL, AOL's predecessor and a State-owned enterprise, between 1991 and 1992. Under s 21 of the Supreme Court Act 1981 (c 54) (UK), the court would only be seised of its admiralty jurisdiction via an arrest if and only if the owner of the vessel at the time of arrest (in this case, in 1995) was also (a) the person who was liable on the claim in respect of which the arrest had been brought (to use the language of the statute, 'the person who would be liable in personam') and (b) the owner or charterer of, or in possession or control of, the vessel at the time when the cause of action arose (in this case, between 1991–1992). The question for the court was whether AOL was the same legal person as POL such that the admiralty jurisdiction of the court might be engaged.
39 Colman J concluded AOL was not. He noted right from the outset that the case was different from that of Metliss … in the sense that in order for the admiralty jurisdiction of the court to be engaged, it would not suffice for AOL to be seen as a 'universal successor' of all the assets and liabilities of POL. Instead, what was required was that there had to be continuity of legal personality and on the facts he held that this was absent for the following reasons: (a) POL was an unincorporated state enterprise which was conceived as a branch of the Ministry of Fisheries whereas AOL was a joint stock company; (b) the incorporation of POL took place in stages and it was never contemplated that the entirety of its assets would be transferred to AOL; and (c) upon the incorporation of AOL, all of its shares were first held by a State-owned fund for sale by that fund to the public. Put together, these factors suggested that there were sufficient incidents of discontinuity that it could not be said, at least for the purposes of s 21 of the Supreme Court Act (and in this regard, the court noted that this section had to be construed narrowly), that AOL was the same legal person as POL. The first factor was one that Colman J focused particular attention on, for he said that the 'kind of legal entity created at the moment of registration differed so fundamentally from the kind of legal entity that existed up to that time, that to describe them as the same juridical person would be entirely improbable' (at 17).
40 The Kommunar (No 2) is useful for clarifying the nature of the doctrine of universal succession. The doctrine of universal succession does not require the unbroken and consistent existence of the former entity and its eventual transformation into a new. Rather, it is properly seen as a process of inheritance. Therefore, it can take place even if an entirely new entity is formed to take over the assets and liabilities of the old ... It would seem to suggest that the doctrine of universal succession can also apply even if the former entity continues to exist after it has given up its assets and liabilities. This might seem incongruous, given that the notion of 'succession' suggests the extinction of the former entity but as Prof Briggs cautioned, '[s]uccession is, in truth, an image; a metaphor, but not a straightjacket' ... Much depends, in the ultimate analysis, on what is recognised by the law of incorporation.
[emphasis in original omitted; emphasis added in italics and bold italics]
[s] 13-16. Implementation of the merger
(1) When the period for objections pursuant to [s] 13-14 has expired for all the companies that participate in the merger, and the relations with creditors that have made objections pursuant to [s] 13-15 have been clarified, the assignee company shall notify the Register of Business Enterprises on behalf of all participating companies that the merger shall take effect. When the merger has been registered, the following effects of the merger occur:
1. the assigning company is deemed liquidated;
2. the assignee company is deemed incorporated or the share capital in the company is increased;
3. the assigning company's assets, rights and obligations are transferred to the assignee company;
4. the shares in the assigning company are exchanged for shares in the assignee company. Shares in the assigning company that are owned by the assigning company itself or the assignee company, or which are owned by anybody acting in his own name but for the assigning or assignee company's account, may not be exchanged for shares in the assignee company;
5. any claim for consideration in assets other than shares matures, except as otherwise provided;
6. other effects as provided in the merger plan.
...
[emphasis added in bold italics]
(a) the preparatory materials of the Norwegian Companies Act;
(b) the status of the predecessor and successor entities following the mergers; and
(c) the extent to which assets, rights, obligations, and liabilities are transferred following the mergers.
The characteristic feature in a merger, as opposed to regular dissolving, is that the company's business shall be [continued/carried on] … as part of a larger legal unit. While for regular dissolving it is clearly correct to have a view of cessation, it will for mergers be reason to emphasise the continuity that will be made with regard to the business of the company.
The Ministry also stated in a general letter that mergers "are completed on the basis of company law rules that are founded on considerations of continuity – the assigning company is considered to be carried on in the assignee company" [emphasis added]. Mr Sveen contended that the effect of this is that the assigning company is not being dissolved in the sense that it "disappears", but rather is considered to be carrying on as part of the new merged entity.
In relation to transfer of obligations, it is clear that a breach of a prohibition of transfer will not result in the termination of the liability. The acquiring company has assumed all values, and if obligations have been transferred in a merger in breach of the prohibition of transfer, the acquiring company must still be held liable for these. This, however, does not apply to rights. As a general rule, a right that has been transferred in breach [of] a prohibition to transfer, may not be claimed by the acquirer. In the Committee's opinion, this must also apply in mergers. As the transferring company has been liquidated in the merger, a breach of the prohibition of transfer of rights in a merger may result in a situation in which the right may not be claimed by anyone. [emphasis added in italics and bold italics]
21 ASSIGNMENT AND SUBCONTRACTING
21.1 [Hydralift] may not assign the contract or any part thereof or any benefit interest [sic] therein or thereunder and, for the avoidance of doubt and without limiting the generality of foregoing [sic], [Hydralift] may not assign any receivables or any sums due from the company under the terms of the contract.
(a) Mr Sveen's evidence was that in a merger under Norwegian law, the principle of continuity is the default rule and any restriction on transferability would be the exception. The principle of continuity means that the transferee company continues the whole business of the transferor company and treats the transferor company as being continued in and by the transferee. A "specific basis" must exist for a contractual provision to operate as a prohibition on a transfer of rights upon a merger. This imposes a high threshold to be met. A "specific basis" will exist if the provision specifically prohibits a transfer of rights upon a merger and absent compelling circumstances, this will not be found to be the case if the provision does not expressly refer to mergers, amalgamations, change of control or the like. This "specific basis" requirement is a rule of Norwegian company law and therefore applies to the prohibition on transfer in cl 21.1 of the Contract, even though the Contract itself is governed by Singapore law.
(b) Mr Perland's evidence on the other hand was that the "specific basis" requirement does not apply to cl 21.1 of the Contract because that is a rule of Norwegian contract law and not of Norwegian company law. As the Contract is governed by Singapore law, the "specific basis" requirement has no application to cl 21.1. Additionally, the rationale of the "specific basis" requirement is not engaged by cl 21.1. The interpretation of a contract must take into account the parties' background. While Norwegian parties entering into a contract governed by Norwegian law are taken to be aware of the "specific basis" requirement and can be reasonably expected to draft their contracts with that in mind, there is no reason to expect KFELS, a non-Norwegian legal person, contracting under Singapore law to do so.
There is no basis that the parties at the time of entering into the agreement had any reflected or agreed attitude to what «sale» should include. As both the High Court and the Court of Appeal have held, I think that owner of Tjelle Eiendom, Lars Ole Tjelle, must carry the risk for any potential assumptions. He acted on behalf of his real estate company and had, at least for most part, knowledge about the merger concept. The fact that he exercised the right of first refusal in relation to the merger in the belief that the agreement gave him such right in such transactions, cannot lead to another conclusion.
In our respectful view, the court's observations regarding the parties' common intention at the point of entering the contract was essentially an affirmation of an objective approach taken to the interpretation of the agreement. It does not set out any principle of law that non-Norwegian contracting parties would be exempt from the "specific basis" requirement in Norwegian law.
17 … There is an important policy interest … in ensuring the effective and speedy enforcement of such international arbitration awards; the corollary, however, is that the task of the enforcing court should be as 'mechanistic' as possible. Save in connection with the threshold requirements for enforcement and the exhaustive grounds on which enforcement of a New York Convention award may be refused … the enforcing court is neither entitled nor bound to go behind the award in question, explore the reasoning of the arbitration tribunal or second-guess its intentions. Additionally, the enforcing court seeks to ensure that an award is carried out by making available its own domestic law sanctions. …
18 Viewed in this light, as a matter of principle and instinct, an order providing for enforcement of an award must follow the award. No doubt, true 'slips' and changes of name can be accommodated; suffice to say, that is not this case. Here it is sought to enforce an award made against a single party, against two separate and distinct parties. To proceed in such a fashion, necessarily requires the enforcing court to stray into the arena of the substantive reasoning and intentions of the arbitration tribunal. Further, enforcement backed by sanctions, is sought in terms other than those of the award. … In my judgment, this is all inappropriate territory for the enforcing court. The right approach is to seek enforcement of an award in the terms of that award.
[emphasis added in italics and bold italics]
Alternatively, if it matters that another party was named in the arbitration proceedings and the award, it seems to me that a judgment against one party will be a judgment to the same effect as the award. What the Act is concerned with is the substance of the orders sought to be made and the substance of the award made. I am encouraged to take this approach because to interpret the section in the way sought would cause practical difficulties and create technical obstacles to a practical procedure; for example, one defendant may be in the jurisdiction while another defendant may not be. [emphasis added]
Notwithstanding the advocacy of a mechanistic approach to the enforcement of arbitral awards, the Courts have nevertheless declined to be rigid if it would be contrary to the spirit of the Ordinance which is to facilitate the enforcement of arbitration agreements and awards. In the first instance decision of the Court in Xiamen v Eaton Properties Limited and ors HCCT 54/2007, 24 June 2008, Reyes J pointed out that there is nothing in the Ordinance which ties the Court's hand to enforcing only part of an award where appropriate, and further, that the Court has a degree of flexibility in the deployment of the means of enforcement available to it. In JJ Agro Industries (P) Ltd v Texuna International Ltd [1992] 2 HKLRD 391, Kaplan J also held that the doctrine of severability of an award enables the Court to enforce such part of an award as is within its jurisdiction, and that it would be contrary to the spirit of the Ordinance if enforcement were to be refused in respect of a severable part of an award which is not in issue. These decisions go beyond the identification of the parties named in the award. To be blind to the natural and reasonable meaning as is apparent from the Awards, and refuse enforcement of the Awards in this case would be obstructing rather than "facilitating" arbitration, and entirely contrary to the aim and objectives of the Ordinance in section 3. This is so when there is no need whatsoever to 'go behind' the Awards to understand what it means, or to be embroiled in the underlying dispute or the tribunal's reasoning for the Awards, in order to identify the party or parties named in the Awards.
[emphasis added in italics and bold italics]
We agree with these observations. Where there is no need for the court to be embroiled in the tribunal's reasoning and the merits of the dispute to identify the parties named in the award, the court is not powerless to enforce the award in a situation of a true misnomer. The court endeavours to facilitate the enforcement of arbitral awards. An unduly rigid approach towards enforcement would be antithetical to this aim. As acknowledged by Gross J in Norsk Hydro (above at [77]), true "slips" and changes of name can be accommodated within the mechanical approach to enforcement.
51 … We prefer to state the question as one of principle, namely, who would reasonably have been understood by the party against whom the claim was asserted to be the entity bringing the claim? Within the misnomer cases, that approach is that of Lloyd LJ in The Sardinia Sulcis [1991] 1 Lloyd's Rep 201 …. In our case, the proceedings were commenced on the instructions of [the vendors' agent], acting on the authority of [a director]. But what was the nature of that authority? Plainly, to protect the interests of the vendors … [The vendors' agent] had no business to include a claimant in the proceedings, and [the director] had no business to permit him to do so, unless that claimant was one of those vendors. [The non-existent vendor] was therefore a claimant as, but only as, one of the vendors.
52 That would have been obvious, to the extent of not even needing thought, to [the purchaser]. And it would also have been obvious from a scrutiny of the pleadings. … [T]he best source for what the claimant actually intended is to be found in the points of claim. In our case the pleadings unequivocally said that they were brought jointly by the [vendors]. In those circumstances the fact that the title of the proceedings did not record that the relevant vendor had transferred all of its rights to [the parent company] under the transformation agreement was indeed a mere misnomer.
...
54 The approach suggested above matches with that of this court in a case … concerning a landlord's counter-notice, Lay v Ackerman [2004] HLR 684. The notice is valid if it leaves the tenant in no doubt that it comes from the landlord. By the same token, the pleadings in this case could not leave anyone in any possible doubt that they were advanced on behalf of the vendors … and of no one else.
55 The arbitral proceedings accordingly were not and are not a nullity. [The parent company] even if not already a party to them joined in them by instructing its solicitors to put its name in the place of the fourth claimant.
[emphasis added in italics and bold italics]
50 … If the proceedings were started on behalf of a party who did not exist, then they were a nullity. If on the other hand it was clear who the party was, but there was simply an error in naming him, the proceedings were not a nullity and the error can, in appropriate circumstances, be corrected within them… The present case differs from the orthodox in two ways. First, it concerns an arbitration, governed by the law of contract and not by rules of court. Second, it is a singular feature of the case that it is the claimant in that arbitration who asserts that the proceedings in which he has taken an active part are a nullity because the claim was brought not in his name but in the name of a non-existent company. [emphasis added in italics and bold italics]
24 The question which arises under this head is, simply stated, what was the identity of the corporate entity which Manches, the solicitors then acting, intended should be a claimant in the arbitration proceedings? Did Manches simply get the name wrong, because they did not know about the merger, or Old Aachener Re's dissolution, or could it be said that their mistake was not merely the use of a wrong name, or a 'misnomer', but evinced a more fundamental error, that is to say an intention to bring the proceedings by a wrong claimant, which was no longer in existence. If the case was one of mere 'misnomer', then the authorities show that the position can be corrected be simply amending the name of the party to the proceedings, which are nonetheless validly constituted; on the other hand, if the intention was in fact to bring the proceedings on behalf of a wrong party, then the proceedings are indeed a nullity.
25. Thus where proceedings are begun in the name of a non- existent company, they are a nullity and the defect cannot be cured by amending to substitute another company (ie a different legal entity) as claimant: Lazard Brothers v Midland Bank Ltd [1933] AC 289 (HL). However, the rule is different if the case is one of misnomer. In cases of misnomer, even where the name on the record refers to an entity which no longer exists, the court can correct the record and the proceedings are correctly constituted ab initio: The Sardinia Sulcis [1991] 1 Lloyd's Rep 201, 205 (CA).
[emphasis added in italics and bold italics]
Gloster J cited The Sardinia Sulcis [1991] 1 Lloyd's Rep 201 (at 205) for the proposition that in cases of misnomer, even where the name on the record refers to an entity which no longer exists, the court can correct the record and the proceedings are correctly constituted ab initio. There, an award had been issued in the name of a party which had ceased to exist by reason of a merger with its parent company even before the commencement of the arbitration. The court explicitly considered that "this [did] not undermine the award" (at 208).
(a) First, in Mr Frode Jensen's witness statement in support of NOV Norway in the arbitration, he omitted to disclose that Hydralift had been struck off the Norwegian register of companies due to the 2004 mergers. Instead, the use of the present tense in his statement that "NOV is the owner of Hydralift AS" [emphasis added] implies that Hydralift is an existing and separate legal person owned by NOV Norway and that Hydralift was indeed the respondent in the arbitration (GD at [123]). Mr Kelvin Poon, counsel for the appellant, rightly conceded before us that it could and should have been more clearly put that Hydralift had long ceased to exist as a separate legal entity.
(b) Second, in the related litigation, NOV Norway appeared in the name of Hydralift and presented NOV Norway as having acquired Hydralift rather than having merged with Hydralift via NOH (GD at [125]–[127]). NOV Norway even volunteered a unique identification number for Hydralift, which was not Hydralift's historical identification number, but rather the identification number of a completely different legal entity (specifically, one Startfase 80 AS which later changed its name to "Hydralift AS" in 2004) (GD at [129]). Mr Jensen's explanation that they did so "in order not to complicate matters" does not change the fact that it was a conscious decision by NOV Norway to impersonate Hydralift for the sake of convenience.
(c) Third, in Mr Haavard Endal's affidavits filed in support of Hydralift in the related litigation, he stated that he was authorised to make the affidavits on behalf of Hydralift and that Hydralift and/or its solicitors had made information and documents available to him for that purpose. This clearly represented that Hydralift was still in existence as a separate legal person and it was Hydralift that was responding to KFELS' claims in the ongoing litigation (GD at [149(b)]).
(a) First, KFELS was dissatisfied with the original Tribunal and lost the chance to commence fresh arbitration proceedings before a different arbitral tribunal against NOV Norway, and this was something it could have done if it had known that the arbitration was defective.
(b) Second, NOV Norway's argument that it would have continued the arbitration without more wrongly assumed that the Tribunal would have granted any application to substitute NOV Norway as the respondent in the arbitration.
(c) Third, KFELS suffered detriment from being deprived of the opportunity to defend the counterclaim on the basis that it had been brought by a non-existent entity.
(d) Fourth, KFELS was deprived of the opportunity to address NOV Norway's misleading of the Tribunal and impeach the credibility of NOV Norway's witness, Mr Jensen. This was material since the Tribunal preferred the evidence of Mr Jensen over KFELS' witnesses.
It is further to be noted that a representee is deemed to have altered his position, not only when he has adopted a positive course of action which he would not have adopted but for his belief in the truth of his representation, but also when he has abstained from taking measures for his protection, security or advantage which he had in contemplation, and which, but for the representation, he would have taken; or when he has persisted in a line of conduct which otherwise he would have abandoned or was on the point of abandoning.
[emphasis in original omitted, emphasis in italics added]
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