Case Digest No. 11 · Arbitration
Settlement agreements and superseding dispute-resolution clauses
Destin Trading Inc v Saipem SA [2025] EWHC 668 (Ch)
The High Court dismissed a stay application, applying the principle that a dispute-resolution clause in a settlement or termination agreement will generally supersede a different clause in an earlier agreement.
High Court (Chancery Division)
[2025] EWHC 668 (Ch)
July 2025
Decision at a glance
The question, answer and consequence.
- Legal question
- The central issue was settlement agreements and superseding dispute-resolution clauses.
- Court's answer
- The High Court dismissed a stay application, applying the principle that a dispute-resolution clause in a settlement or termination agreement will generally supersede a different clause in an earlier agreement.
- Practical consequence
- The judgment addresses whether a later settlement agreement replaces an earlier arbitration clause. It provides a useful drafting and dispute-strategy lesson whenever successive agreements contain different jurisdiction or dispute-resolution provisions.
Factual background
Destin and Saipem had a longstanding partnership. The parties entered into a series of Memoranda of Understansing relating to various projects, before concluding three more specific Frame Agreements concerning some of these projects. Each of the Frame Agreements provided that the parties were bound by Saipem’s General Terms and Conditions for Agreement Documents, which incorporated ICC arbitration clauses providing for ICC arbitration seated in London. A dispute arose over the amount owed to Destin. The parties entered into a Settlement Agreement under which they settled Destin’s claim, gave a mutual release of claims and terminated the Framework Agreements. A clause provided for the Courts of England and Wales to have exclusive jurisdiction to settle any dispute arising out of or in connection with the Settlement Agreement. Destin commenced a claim seeking to rescind the Settlement Agreement and restitution of all sums due to them (the “Monetary Claims”). Saipem subsequently sought a stay pursuant to s9(1) Arbitration Act 1996 of parts of Destin’s claim on the ground that they are matters to be referred to arbitration.
Issue
The central issue was settlement agreements and superseding dispute-resolution clauses.
Procedural history and reasoning
LEADING CASE on the application of this principle is Monde Petroleum v Westernzagros Limited [2015] 1 Lloyd’s Rep 330: “…the dispute resolution clause in the termination/settlement agreement should be construed on the basis that the parties are likely to have intended that it should supersede the clause in the earlier agreement and apply to all disputes arising out of both agreements. Whether it does so in any particular case will depend upon the language of the clause and other surrounding circumstances.” (Popplewell J at para 39) In construing Clause 10 of the Settlement Agreement, it was to be inferred that the parties, as rational businesses, would have intended that Clause 10 would govern all aspects of the parties’ relationship, including disputes relating to the Settlement Agreement and disputes relating to the Frame Agreements. SAIPEM (Defendant/Applicant) The court is NOT BOUND BY ANY GENERAL PRINCIPLE that a dispute resolution clause in a settlement agreement supersedes a prior dispute resolution clause.
Whether or not a dispute resolution clause has such an effect TURNS ON THE CONSTRUCTION OF THE LANGUAGE used by the parties in any given case. KEY PRINCIPLES relevant to the application of s9 those summarised in Mozambique v Privinvest [2023] UKSC 32: “First, as I have stated…the court in considering such an application [to stay proceedings pursuant to Section 9] adopts a two-stage process. First the court must determine what the matters are which the parties have raised or foreseeably will raise in the court proceedings, and, secondly, the court must determine in relation to each such matter whether it falls within the scope of the arbitration agreement. In carrying out this exercise the court must ascertain the substance of the disputes between the parties.” (Lord Hodge at paras 72 and 73) The words “in connection with this Agreement” in Clause 10 were REFERRING EXCLUSIVELY to the Settlement Agreement and the Monetary Claims were in substance claims under the Frame Agreements.
RELEVANT DISPUTE RESOLUTION CLAUSES Frame Agreements “50.2 Unless otherwise stated in the AGREEMENT, all disputes arising out of or in connection with the AGREEMENT DOCUMENTS which are not settled amicably under the preceding paragraph of this Clause within forty-five (45) Calendar Days after receipt of the above- mentioned written request, shall be submitted by either PARTY to arbitration in accordance with the Rules of Arbitration of the International Chamber of Commerce by three (3) arbitrators appointed in accordance with the said rules. 50.3 Unless otherwise stated in the AGREEMENT, the arbitration proceeding shall be held in London (United Kingdom) and conducted in the English language.” Settlement Agreement “10. The Parties irrevocably agree that the Courts of England and Wales shall have exclusive jurisdiction to settle any dispute arising out of or in connection with this Agreement (including a dispute regarding the existence, validity or termination of this Agreement).” RULING (Andrew Lenon KC) Saipem’s stay application was DISMISSED.
Decision and key points
The High Court dismissed a stay application, applying the principle that a dispute-resolution clause in a settlement or termination agreement will generally supersede a different clause in an earlier agreement.
- A later settlement or termination agreement will generally be construed as superseding an earlier dispute-resolution clause.
- That is a strong inference rather than a rigid rule; the language and circumstances remain important.
- The approach supports one-stop adjudication of disputes concerning the parties’ settlement.
Why this decision matters
The judgment addresses whether a later settlement agreement replaces an earlier arbitration clause. It provides a useful drafting and dispute-strategy lesson whenever successive agreements contain different jurisdiction or dispute-resolution provisions.
Particularly relevant to: Arbitration practitioners, transactional lawyers, corporates and enforcement teams.