[co-author: Lilyana Georgieva]
A recent judgment of the English Commercial Court in V Ships Ltd v Luna Management Corp [2025] EWHC 3329 (Comm), illustrates not only the willingness of the English courts to grant anti‑suit injunctions (ASIs) to restrain foreign proceedings commenced in breach of an arbitration agreement, but also their readiness to use their coercive powers to enforce such injunctions.
In this case, the English court found a company that commenced, and the individual who controlled, litigation in Greece in defiance of an ASI granted by the English court, guilty of contempt of court. The court also confirmed that corporate formalities will not shield individuals who are the de facto directing minds behind a company's breach.
Factual background
The claimant, V Ships, was a Cypriot ship management company. The first defendant, Luna Management Corp (Luna), was a Liberian ship‑owning company. The second and third defendants were Lambros Stravelakis (Lambros) and his father, Stefanos Stravelakis (Stefanos), both individuals resident in Greece.
V Ships and Luna were parties to a ship management agreement dated 30 March 2022 in respect of the crude oil tanker Priority. The agreement contained an arbitration clause. Notwithstanding that clause, Luna commenced multiple civil proceedings in Greece (the Greek Proceedings). An arbitration was also commenced and concluded in December 2024 with an award in favour of V Ships which required Luna to terminate the Greek Proceedings and to take all necessary steps to discharge any and all court orders made or arising out of these proceedings.
Luna did not comply. Instead, it continued the Greek Proceedings, prompting V Ships to obtain an ASI from the English courts in January 2025 by way of enforcement of the award. Luna defied the ASI and continued to pursue the Greek Proceedings throughout 2025. As a result, V Ships brought contempt claims before the English court against Luna and the individuals it considered to be directing Luna's conduct – Lambros and Stefanos.
Stefanos died on 11 November 2025 and the contempt application against him was discontinued.
Two immediate matters arose for decision at the hearing before Mr Justice Andrew Baker in mid-December 2025: (1) whether to adjourn the hearing, Lambros having sought an adjournment by application notice dated 3 December 2025 on the ground that Stefanos, who was then sole director of Luna, had died; and (2) whether to proceed in the absence of Luna. If an adjournment was not granted, and the court decided to proceed in the absence of Luna, then it would also have to decide whether to grant the contempt application against Luna and/or Lambros.
The Commercial Court's analysis
Adjournment application
Lambros argued that the hearing of the contempt applications should be adjourned because Stefanos (the sole director of Luna) had recently died, and under Greek law heirs had four months to decide whether to disclaim the inheritance. The application notice claimed that (a) there was nobody able to give instructions on behalf of Luna, which had a right to be heard and whether Luna wished to participate had nothing to do with Lambros; (b) no steps could be taken in the Greek Proceedings since there was nobody who could give instructions on Luna's behalf, meaning that the urgency of the contempt application was less pressing; (c) Lambros could not attend the hearing while dealing with his father's death.
The judge concluded that the asserted absence of anyone capable of acting for Luna was (if true) "only through deliberate inaction on the part of those capable of securing the contrary". He also noted that regardless of who controlled Luna, it was clear that Luna had decided long before Stefanos's death not to participate in the English court proceedings to defend itself against the charge of contempt. Moreover, since neither Luna nor Stefanos intended to take part in the contempt proceedings when Stefanos was alive, Stefanos's death had no bearing on the fairness of proceeding: it was exactly the same hearing Lambros would have faced if his father was still alive.
Importantly, the judge held that the urgency remained as Luna had continued the Greek Proceedings in breach of the ASI and a finding of contempt by the English court may be the only realistic method of inducing the termination of the Greek Proceedings before the Greek court gave judgment. The English court was of the view that adjourning the hearing of the contempt application would have caused substantial injustice to V Ships but would not have been unfair to Lambros because if V Ships failed to prove he controlled Luna, the case against him would have failed.
For these reasons the judge did not adjourn the hearing.
Proceeding in the absence of Luna
The judge noted that Luna had been served with every aspect of the English proceedings, including the ASI and the contempt application, and had been given more than ample opportunity to present a defence, if it had one. The only reason for Luna's non-appearance was the deliberate decision by whomever was controlling Luna to ignore the English proceedings. The judge concluded that "Luna had waived any right to be present" and there "was no material disadvantage to Luna in being unable to present any account of events, firstly, because it had evidently chosen not to engage and, secondly, because, with respect, it, the company, evidently had no credible defence to the charge of contempt". The judge also considered that there was a real risk of serious injustice to V Ships if the hearing did not proceed. Therefore, the judge ruled that the hearing should proceed in Luna's absence.
Contempt of court
A central issue in the contempt application was "by whom Luna has so conducted itself"; in particular, whether Lambros was the de facto controller of Luna and could be held personally liable for contempt. The court examined his conduct, communications, and corporate arrangements.
Lambros argued that he was not in control of Luna. He relied on changes in the shareholding and directors of Luna in support of his position. In September 2022, when Priority was sold by Luna, the shareholding in Luna was temporarily transferred to Branzino Trading Corporation (Branzino), a Marshall Islands company. By July 2023, however, the shares in Luna were once again held by Lambros and his brother Nikolaos before being transferred to Branzino again as of 29 October 2024. Before that, on 10 June 2024, Lambros was replaced by Stefanos as Luna's sole director. V Ships alleged that notwithstanding these share transfers and change in directors, Lambros was throughout the de facto directing mind and thus de facto director of Luna. V Ships argued that the litigation was his, the litigation strategy his and the defiance of the ASI injunction his.
The judge concluded that Luna had in effect always been Lambros's company and that his father had not played any genuine role in its management. After the sale of Priority, Luna's sole remaining purpose was to pursue claims against V Ships. It was clear that Lambros had controlled Luna throughout the relevant period and had been the person who identified, developed, and advanced the claims against V Ships. The suggestion that his father had been directing Luna and overseeing the Greek proceedings was not credible. The judge noted that there was "a lack of credible reason for Lambros to gift his very elderly father the burden of his, Lambros's, fight with V Ships". Further, Lambros was fully aware of the ASI and its requirements. The contempt applications had been properly served and still no action had been taken to halt the Greek Proceedings. Luna was therefore in contempt of court, and its conduct was attributable to Lambros as its de facto controller. He was the individual truly responsible for Luna and was likewise in contempt.
The case illustrates a successful invocation of the "Body Corporate Provision", under which the courts, in exercising their civil contempt jurisdiction, may impose sanctions on the directors or officers responsible for a company's breach of court orders, including those acting as the directing mind.
A further hearing to determine the appropriate sentence for the contempt is scheduled to take place this spring.
For another example of the English courts exercising their substantial coercive powers against recalcitrant parties in support of London-seated arbitrations, please see this article.
Drawing adverse inferences
Lambros provided a witness statement but was unwilling to attend the hearing. As a person accused of contempt, Lambros was entitled to decline to give oral evidence; however the court could draw an adverse inference that such decision corresponded with the notion that his case would not withstand cross examination, as in the case of Therium (UK) Ltd v Brooke [2016] EWHC 2421 (Comm), [2016] 10 WLUK 130 which was considered.
Key takeaways
- The English courts uphold arbitration agreements and are willing to grant ASIs when foreign proceedings are commenced or continued in breach of an arbitration clause.
- Parties who persist with foreign litigation in defiance of an ASI granted by the English courts risk serious consequences, including being found in contempt of court and receiving a custodial sentence.
- Individuals who are the de facto the directing minds of a company cannot avoid responsibility for the decisions that they take on the company's behalf. The English courts will scrutinise formal appointments to identify who is truly controlling the company.
- Once served with an ASI, parties must take immediate, active steps to comply.
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