The right to be heard in arbitration

26/11/12

In Terna Bahrain Holding Co. WLL ("Terna") v. Bin Kamil Al Shamsi & others ("the Binkamils") [2012] EWHC 3283 (Comm), Popplewell J considered various applications which arose from Terna seeking to enforce a London arbitration award under section 66 of the Arbitration Act 1996 ("the 1996 Act"), and the Binkamils' subsequent attempts to challenge the award out of time under sections 67 and 68 of the 1996 Act.

The judge dismissed the challenge and permitted the award to be enforced as a judgment of the High Court. He also granted an anti-suit injunction to Terna restraining the Binkamils from bringing proceedings in the UAE or elsewhere to challenge the award. Terna was awarded indemnity costs of both the main applications.

An interesting feature of the judgment is Popplewell J's analysis of what an applicant is required to show to establish substantial injustice under section 68 of the 1996 Act arising from not having made full submissions on a determinative issue in the award. He held that, whilst section 33 of the 1996 Act requires a party to be given a reasonable opportunity of addressing his opponent's case, that does not mean that the arbitral tribunal is acting unfairly in deciding a case on a point to which the party raising it does not give any great emphasis or which is not the subject matter of any great exposition. In his judgment, there is nothing unfair about a point not being specifically addressed during oral argument; an issue raised in written submissions does not have to be drawn attention to during any hearing, or mentioned or developed orally, in order for the other side to have a fair opportunity of dealing with it.

The judge also considered in some detail the law on applications for extensions of time for challenging an arbitration award. In his judgment, where the evidence of the cause of the delay is consistent with laxity, incompetence or honest mistake (on the one hand) and a deliberate informed choice (on the other), an applicant's failure to adduce evidence that the true explanation is the former can legitimately give rise to an inference that it is the latter.

The judgment is here.