Clifford Chance

Courts reluctant to grant appeal of arbitral award on point of law

27 February 2014

In an arbitration with a seat in England, the losing party can appeal to the High Court to review the arbitral award for substantive errors of law made by the tribunal. If the appeal is successful, the court will remit the award to the tribunal for reconsideration, vary it or set it aside in whole or in part.

This right of appeal under Section 69 of the Arbitration Act 1996 is a peculiarity of English arbitration law not found in many other jurisdictions. In practice, the courts generally respect the tribunal's award as the decision of the parties' choice and only sparingly exercise the power conferred by Section 69.

The right of appeal is subject to the following limitations:

• It is available only if not otherwise agreed by the parties. Parties routinely waive the right of appeal, either by express provision in the arbitration clause or by incorporating institutional rules that exclude it, such as those of the London Court of International Arbitration or the International Chamber of Commerce.
• Even where the right of appeal has not been waived or excluded, only questions of law – not questions of fact – can be appealed. They must be questions of English law and must substantially affect the rights of the parties.
• The appeal can be initiated only with the agreement of all parties or with leave of the court. Leave will be granted only if a number of conditions are satisfied. These include that the arbitral tribunal's decision on the question that is the subject of the appeal must be either obviously wrong or, where the question is one of general public importance, at least open to serious doubt.
• The right is available only for a short period of time. The application to the court must generally be made within 28 days of the date of the arbitral award or the applicant's being notified of the results of any arbitral review process (eg, by the arbitral tribunal or an arbitral institution).

The recent decision in ED&F Man Sugar Ltd v Unicargo Transportgesellschaft GmbH provides a good example of the courts' approach to considering appeals of awards where the right of appeal has not been excluded. This article explores this decision further.

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