Foreign Arbitration Award Sufficient Basis For A BVI Statutory Demand

The Eastern Caribbean Court of Appeal ("ECCA") has held¹ that there is no need for a creditor with the benefit of a foreign arbitration award to register or obtain permission to enforce the award within the BVI before proceeding by way of statutory demand.

The case concerned a monetary award made in an arbitration before the London Court of International Arbitration. The creditor served a Statutory Demand on the Debtor, a BVI company, in the BVI.

The Debtor applied to set the demand aside on the basis (inter alia) that there was no debt due because an unenforceable award could not form the basis of a statutory demand. It founded its case on Section 10(3) of the BVI Insolvency Act, 2003 which excludes from the definition of liabilities for the purpose of the Act "an illegal or unenforceable liability". The Debtor argued that a foreign award is unenforceable within the meaning of Section 10(3) unless or until it is declared by the BVI Court to be recognised and