“What would be highly unsatisfactory and unfair would be a situation in which the ICC Court was not now in a position to provide the full scope of the reasons it would have given had a timely request been made without in effect impermissibly reconstituting the ICC Court that made the decision. The Respondent would request clarification as to how the ICC Court would propose addressing these concerns were (which does not appear possible in any event) it to entertain the Claimants’ request in order to safeguard the Respondent’s position as the successful party.”
“The fair-minded and informed observer would also be aware that in international arbitration the parties to an arbitration and their legal advisers may often have only limited knowledge of the reputation and experience of a professional who is appointed by an institution or by the court to chair their arbitration. While many parties and their advisers who are engaged in high value international arbitrations devote considerable resources to researching the background of people who might be suitable for selection as party-appointed arbitrators or as nominees for third party appointment, there is no basis for assuming that that practice is universal. The professional reputation and experience of an individual arbitrator is a relevant consideration for the objective observer when assessing whether there is apparent bias as an established reputation for integrity and wide experience in arbitration may make any doubts harder to justify. But the weight which the fair-minded and informed observer should give to that consideration will depend upon the circumstances of the arbitration and whether, objectively and as a generality, one could expect people who enter into references of that nature to be informed about the experience and past performance of arbitrators. In the context of many international arbitrations, it is likely to be a factor of only limited weight. The weight of that consideration may also be reduced if the circumstances give rise to a material risk of unconscious bias on the part of a person of the utmost integrity: Almazeedi v Penner[2018] UKPC 3 at [1], per Lord Mance JSC.”
“An arbitrator, like a judge, must always be alive to the possibility of apparent bias and of actual but unconscious bias. The possibility of unconscious bias on the part of a decision-maker is known, but its occurrence in a particular case is not. The allegation, which is advanced in this case, of apparent unconscious bias is difficult to establish and to refute. One way in which an arbitrator can avoid the appearance of bias is by disclosing matters which could arguably be said to give rise to a real possibility of bias. Such disclosure allows the parties to consider the disclosed circumstances, obtain necessary advice, and decide whether there is a problem with the involvement of the arbitrator in the reference and, if so, whether to object or otherwise to act to mitigate or remove the problem.”
“…the obligation of impartiality continues throughout the reference and the emergence during the currency of the reference of matters which ought to be disclosed means that an arbitrator’s prompt disclosure of those matters can enable him or her to maintain what Lord Hope calls the “badge of impartiality”.”
“It is also clear that an arbitrator may fail to make disclosure for entirely honourable reasons, such as forgetfulness, oversight, or a failure properly to recognise how matters would appear to the objective observer. But as Lord Bingham stated in Davidson 2005 1 SC (HL) 7, para 19, “However understandable the reasons for it, the fact of non-disclosure in a case which calls for it must inevitably colour the thinking of the observer”.”
“In my consideration of the issues I have found it useful to dissect the particular characteristics of the duty of disclosure. It is not an unconditional duty, or a duty in the usual sense of the word, but a part of a bigger picture. The duty is not the primary duty. The primary duty is to act fairly and impartially as arbitrator (section 33 of the Arbitration Act 1996 (“the 1996 Act”), set out in para 49 above). An arbitrator who acts with actual or apparent bias does not act impartially. As hereafter explained, to remove any doubt about apparent bias, an arbitrator may wish to disclose matters to the parties. It is from that consequence of the impartiality duty that a duty of disclosure can be said to arise, but it is not an independent, self-contained duty.”
“Article 11 General Provisions 1 Every arbitrator must be and remain impartial and independent of the parties involved in the arbitration. 2 Before appointment or confirmation, a prospective arbitrator shall sign a statement of acceptance, availability, impartiality and independence. The prospective arbitrator shall disclose in writing to the Secretariat any facts or circumstances which might be of such a nature as to call into question the arbitrator’s independence in the eyes of the parties, as well as any circumstances that could give rise to reasonable doubts as to the arbitrator’s impartiality. The Secretariat shall provide such information to the parties in writing and fix a time limit for any comments from them. 3 An arbitrator shall immediately disclose in writing to the Secretariat and to the parties any facts or circumstances of a similar nature to those referred to in Article 11(2) concerning the arbitrator’s impartiality or independence which may arise during the arbitration. 4 The decisions of the Court as to the appointment, confirmation, challenge or replacement of an arbitrator shall be final. 5 By accepting to serve, arbitrators undertake to carry out their responsibilities in accordance with the Rules. 6 Insofar as the parties have not provided otherwise, the arbitral tribunal shall be constituted in accordance with the provisions of Articles 12 and 13. Article 14 Challenge of Arbitrators 1 A challenge of an arbitrator, whether for an alleged lack of impartiality or independence, or otherwise, shall be made by the submission to the Secretariat of a written statement specifying the facts and circumstances on which the challenge is based. 2 For a challenge to be admissible, it must be submitted by a party either within 30 days from receipt by that party of the notification of the appointment or confirmation of the arbitrator, or within 30 days from the date when the party making the challenge was informed of the facts and circumstances on which the challenge is based if such date is subsequent to the receipt of such notification. 3 The Court shall decide on the admissibility and, at the same time, if necessary, on the merits of a challenge after the Secretariat has afforded an opportunity for the arbitrator concerned, the other party or parties and any other members of the arbitral tribunal to comment in writing within a suitable period of time. Such comments shall be communicated to the parties and to the arbitrators.”
“INDEPENDENCE and IMPARTIALITY In deciding which box to tick, you should take into account, having regard to Article 11(2) of the Rules, whether there exists any past or present relationship, direct or indirect, whether financial, professional or of any other kind, between you and any of the parties, their lawyers or other representatives, or related entities and individuals. Any doubt must be resolved in favour of disclosure. Any disclosure should be complete and specific, identifying inter alia relevant dates (both start and end dates), financial arrangements, details of companies and individuals, and all other relevant information. In deciding which box to tick and as the case may be in preparing your disclosure, you should also consult with care the relevant sections of the Note to Parties and Arbitral Tribunals on the Conduct of the Arbitration.”
“in applying the [fair-minded observer] test to arbitrators it is important to bear in mind the differences in nature and circumstances between judicial determination of disputes and arbitral determination of disputes”, and the “premium on frank disclosure” (Halliburton at [55] – [56].) Another example is Flaux J’s statement at [72] that “disclosure and apparent bias are quite separate questions”
“There is no suggestion of actual bias; but, as the Court of Appeal pointed out in the present case (para 61), if a judge of the utmost integrity lacks independence, “then there is a danger of the unconscious effect of that situation, which it is impossible to calibrate or evidence.”
“In the result, the Board, with some reluctance, has come to the conclusion that the Court of Appeal was right to regard it as inappropriate for the judge to sit without disclosure of his position in Qatar … and that this represented a flaw in his apparent independence … The judge not only ought to have disclosed his involvement with Qatar before determining the winding-up petition. In the Board’s view, and at least in the absence of any such disclosure, a fair-minded and informed observer would regard him as unsuitable to hear the proceedings from at least25 January 2012 on. The fact of disclosure can itself serve as the sign of transparency which dispels concern, and may mean that no objection is even raised.”
“International Court of Arbitration 1 The International Court of Arbitration (the “Court”) of the International Chamber of Commerce (the “ICC”) is the independent arbitration body of the ICC. The statutes of the Court are set forth in Appendix I. 2 The Court does not itself resolve disputes. It administers the resolution of disputes by arbitral tribunals, in accordance with the Rules of Arbitration of the ICC (the “Rules”). The Court is the only body authorized to administer arbitrations under the Rules, including the scrutiny and approval of awards rendered in accordance with the Rules. It draws up its own internal rules, which are set forth in Appendix II (the “Internal Rules”). … 4 As provided for in the Internal Rules, the Court may delegate to one or more committees composed of its members the power to take certain decisions, provided that any such decision is reported to the Court at its next session. 5 The Court is assisted in its work by the Secretariat of the Court (the “Secretariat”) under the direction of its Secretary General (the “Secretary General”).”
“Function The function of the International Court of Arbitration of the International Chamber of Commerce (the “Court”) is to ensure the application of the Rules of Arbitration of the International Chamber of Commerce, and it has all the necessary powers for that purpose. As an autonomous body, it carries out these functions in complete independence from the ICC and its organs. Its members are independent from the ICC National Committees and Groups.”
“Composition of the Court The Court shall consist of a President, Vice-Presidents, and members and alternate members (collectively designated as members). In its work it is assisted by its Secretariat (Secretariat of the Court).”
“Court’s Decision On17 January 2024 , the International Court of Arbitration of the International Chamber of Commerce (“Court”): 1. decided that the challenge filed against Dame Elizabeth Gloster, acting as co-arbitrator nominated by Claimants, is admissible (Article 14(3); and 2. accepted the challenge on the merits (Article 14(3)). We invite Claimants to nominate a co-arbitrator within 15 days.”
“What constitutes a res judicata”
“[2.01] A res judicata is a decision on the merits, pronounced by a tribunal which is judicial in the relevant sense.”
“[2.02] It is immaterial for present purposes whether the tribunal is a court of record or not, or whether it is a superior court or not, or whether it is or is known as a court. Nor does it matter whether the tribunal, if English, has civil or criminal jurisdiction; nor (with certain exceptions) whether the tribunal is English or foreign. It does not matter whether the tribunal has permanent jurisdiction or only jurisdiction over a particular dispute or disputes.”
“… a decision on procedure alone is not a decision on the merits. Looking at the matter positively a decision on the merits is a decision which establishes certain facts as proved or not in dispute, states what are the relevant principles of law applicable to such facts, and expresses a conclusion with regard to the effect of applying those principles to the factual situation concerned”
“What it means in the context of judgments delivered by courts of justice is that the court has held that it has jurisdiction to adjudicate upon an issue raised in the cause of action to which the particular set of facts give rise”
“This Court should be very slow to differ from the view of the LCIA Division. The LCIA Division was the parties’ chosen forum for resolution of the question in issue. It had considerable experience and was well placed to judge how much time would be required for a co-arbitrator properly to consider interlocutory issues of this type”
“[102] We can see no good reason for including "non-partiality" lack of independence as a ground for removal and good reasons for not dong so. We do not follow what is meant to be covered by lack of independence which does not lead to the appearance of partiality. Furthermore, the inclusion of independence would give rise to endless arguments, as it has, for example, in Sweden and the United States, where almost any connection (however remote) has been put forward to challenge the "independence" of an arbitrator. For example, it is often the case that one member of a barristers’ Chambers appears as counsel before an arbitrator who comes from the same Chambers. Is that to be regarded, without more, as a lack of independence justifying the removal of the arbitrator? We are quite certain that this would not be the case in English law. Indeed the Chairman has so decided in a case in Chambers in the Commercial Court. …We would further note in passing that even the oath taken by those appointed to the International Court of Justice, and indeed to our own High Court, refers only to impartiality.”
“Thirdly, a judge is the holder of a public office, is funded by general taxation and has a high degree of security of tenure of office and therefore of remuneration. An arbitrator is nominated to act by one or both of the parties to the arbitration either directly or by submitting names to the appointing body, whether an institution or the court, for appointment. The arbitrator is remunerated by the parties to the arbitration in accordance with the terms set out in the reference, and often is ultimately funded by the losing party. He or she is appointed only for the particular reference and, if arbitral work is a significant part of the arbitrator’s professional practice, he or she has a financial interest in obtaining further appointments as arbitrator. Nomination as an arbitrator gives the arbitrator a financial benefit. There are many practitioners whose livelihood depends to a significant degree on acting as arbitrators. This may give an arbitrator an interest in avoiding action which would alienate the parties to an arbitration, for example by assertive case management against the wishes of the legal teams who are presenting their clients’ cases. It also may give those legal teams an incentive to be more assertive of their side’s interests in the conduct of the arbitration than might be the case in a commercial court.”
“is this arbitrator biased in favour of Freshfields’ clients”
“Public perception of the possibility of unconscious bias is the key”
“(3) In my judgment, if the properly informed independent observer concluded that there was a real possibility of bias, then I would regard that as a species of ‘serious irregularity’ which has caused substantial injustice to the applicant. I do not accept Mr Croall’s submission that even if that conclusion was reached the court must then inquire as to whether substantial injustice has been caused. In my judgment there can be no more serious or substantial injustice than having a tribunal which was not, ex hypothesi, impartial, determine parties’ rights. The right to a fair hearing by an impartial tribunal is fundamental; the Act is founded upon that principle and the Act must be construed accordingly. In these circumstances, upon a proper construction of ss 1, 33 and 68(1) and (2), if the tribunal were not impartial, then the requirements of s 68(1) and (2) are satisfied. … It is contrary to fundamental principles to hold that an arbitral award made by a tribunal which was not impartial is to be enforced unless it can be shown that the bias has caused prejudice. The problem with unconscious bias is that it is inherently difficult to prove and the statements made about it by the judges themselves cannot be tested. Nor can the court know whether the bias actually made any difference or not.”
“[67] In giving the opinion of the Privy Council in RAV Bahamas v Therapy Beach Club Inc[2021] UKPC 8 , Lords Hamblen and Burrows synthesised the relevant considerations in the application of the equivalent provision to section 68 in the Bahamian legislation at issue in that appeal. Without citation of the underlying authorities they are: (i) the test of "serious irregularity" is intended to limit judicial intervention to cases where the arbitral tribunal has gone so wrong in its conduct that justice cries out for it to be corrected:[30]; (ii) the test of serious irregularity imposes a high threshold to be surmounted:[31]; (iii) the focus is on due process, not the correctness of the decision reached:[32]; (iv) even if a case falls within one of the categories provided in sub- section 68(2) , that will only amount to a serious irregularity if the court considers that it has caused substantial injustice - a state of affairs which is 'more than some injustice':[33]; (v) there will be substantial injustice where it is established that, had the irregularity not occurred, the outcome of the arbitration might well have been different. In general, there will be no substantial injustice if it can be shown that the outcome of the arbitration would have been the same regardless of the irregularity:[34], [37]; (vi) some irregularities may be so serious that substantial justice is 'inherently likely' or 'likely in the very nature of things' to result:[35]; (vii) in such cases substantial injustice may be inferred from the nature of the irregularity and that inference may be so strong that 'it almost goes without saying':[35], [36]. [68] Apparent bias on the part of an arbitration tribunal would amount to a breach of the general duty in section 33 and would constitute an irregularity under section 68(2)(a) of the Act. [69] Mr Kulkarni submitted that a finding of apparent bias would lead to the necessary additional requirement in section 68(2) of substantial injustice being assumed without the need to establish it separately. Consequently, the award could be remitted for serious irregularity for the dispute to be heard by another Board of Appeal. Mr Kulkarni cited three High Court decision in support of his submission: Norbrook Laboratories Ltd v Tank[2006] EWHC 1055 (Comm) , [144] , per Colman J, citing Morison J in ASM Shipping Ltd of India v TTMI Ltd[2005] EWHC 2238 (Comm) ; Cofely Ltd v Bingham[2016] EWHC 240 (Comm) , [116] , per Hamblen J (as he then was); and Dadoun v Biton[2019] EWHC 3441 (Ch) , [36] , per Mr Michael Green QC (as he then was). [70] I am not persuaded that all these authorities are as clear as Mr Kulkarni suggested that in an apparent bias case substantial injustice follows as a matter of course. In Norbrook Laboratories Ltd v Tank , although Colman J said that he agreed with what Morison J had said in ASM Shipping Ltd of India v TTMI Ltd, he went on to refer to sole arbitrator cases, but also expressed the principle as being that with bias 'in any award already made, substantial injustice will normally be inferred and where an award has yet to be made substantial injustice will normally be anticipated' (my emphasis): [145]. The passage Mr Michael Green QC relied on from Russell on Arbitration in Dadoun v Biton is similarly qualified, 'substantial injustice will normally be imputed as a matter of course' para 7-129. [71] In any event, there is no support in RAV Bahamas v Therapy Beach Club Inc[2021] UKPC 8 for the suggestion that in a section 68 application a finding of apparent bias in an arbitration tribunal will lead as a matter of course to a finding of substantial injustice. Rather, as we have seen, the effect of the Privy Council advice is that a case within section 68(2)(a) will not constitute a serious irregularity unless the court considers that it has caused substantial injustice, although the nature of the irregularity may be such that the inference of substantial injustice almost goes without saying. Moreover, there will be no substantial injustice if it can be shown that the outcome of the arbitration would have been the same regardless of the irregularity. This court follows a Privy Council authority like RAV Bahamas in preference to any High Court authority to the contrary: Willers v Joyce[2016] UKSC 44 , [12], [16].”
“[159] In these circumstances, I am of the view that to take as the starting point the ruling made by the arbitrators and to give that ruling some special status is to beg the question at issue, for this approach necessarily assumes that the parties have, to some extent at least, agreed that the arbitrators have power to make a binding ruling that affects their rights and obligations; for without some such agreement such a ruling cannot have any status at all. As the Departmental Advisory Committee on Arbitration Law put it in para 138 of its 1996 Report on the Arbitration Bill, an arbitral tribunal may rule on its own jurisdiction but cannot be the final arbiter of jurisdiction, “for this would provide a classic case of pulling oneself up by one’s own bootstraps”. [160] In my judgment therefore, the starting point cannot be a review of the decision of the arbitrators that there was an arbitration agreement between the parties. Indeed no question of a review arises at any stage. The starting point in this case must be an independent investigation by the court of the question whether the person challenging the enforcement of the award can prove that he was not a party to the arbitration agreement under which the award was made. The findings of fact made by the arbitrators and their view of the law can in no sense bind the court, though of course the court may find it useful to see how the arbitrators dealt with the question. Whether the arbitrators had jurisdiction is a matter that in enforcement proceedings the court must consider for itself.”
“[91] Where the serious irregularity arises in relation to the arbitral tribunal’s treatment of a point of law (e.g. allowing one party an insufficient opportunity to present its legal argument or to respond to the other party’s legal argument), but the court has granted leave to appeal under s.69 of the 1996 Act, the de novo hearing before the court will generally be sufficient to “cure” any substantial injustice. In particular, the court is highly unlikely to be receptive to the argument that the loss of the opportunity to obtain a different outcome from the arbitrator which did not meet the threshold for a s.69 challenge is capable of amounting to substantial injustice (Sunrock Aircraft v Scandinavia Airlines System Denmark-Norway-Sweden[2007] EWCA Civ 882 , [36]- [42]).”
“Out of an abundance of caution, the Tribunal members have agreed that each of them would decide for himself or herself whether to accede to the Consolidation Application, and that we would thereafter discuss the question and reach a collegiate view. We took that course, and, fortunately, each of us, individually and independently, reached the same conclusion, adopting the reasoning as set out above and, accordingly, whether the decision should be that of Dame Elizabeth or (as we have concluded) that of the Tribunal as a whole, makes no difference to the outcome in this case, an outcome which we explain in Part G of this Award.”
“Where Disputes arise under this Agreement and under any of the Onshore Facility Agreement and Intercreditor Agreement which, in the absolute discretion of the first arbitrator to be appointed under any of the disputes, are so closely connected that it is expedient for them to be resolved in the same proceedings, that arbitrator shall have the power to order that the proceedings to resolve that dispute shall be consolidated with those to resolve any of the other disputes (whether or not proceedings to resolve those other disputes have yet been instituted), provided that no date for exchange of expert witness statements has been fixed. If he so orders, the parties to each dispute which is the subject of his order shall be treated as having consented to that dispute being finally decided: (A) by the arbitrator who ordered the consolidation unless the ICC decides that he would not be suitable or impartial, and (B) in accordance with the procedure, at the seat and in the language specified in the arbitration agreement in the contract under which the arbitrator who ordered the consolidation was appointed, save as otherwise agreed by all parties to the consolidated proceedings or, in the absence of such agreement, ordered by the arbitrator in the consolidated proceedings.”
“The Identity of “The First Arbitrator””
“Is There Power to Consolidate”
“Should Consolidation Be Ordered.”
“Section 70(3) of the Act requires challenges to an award under sections 67 and 68 to be brought within 28 days. This relatively short period of time reflects the principle of speedy finality which underpins the Act, and which is enshrined in section 1(a). The party seeking an extension must therefore show that the interests of justice require an exceptional departure from the timetable laid down by the Act. Any significant delay beyond 28 days is to be regarded as inimical to the policy of the Act.”
“There are insufficiently cogent or compelling grounds for a stay. Obviously, if the Claimants succeed, further time would then have been lost. We accept, on the other hand, that the Respondent may succeed in the s.68 application. However, on this assumption, even if in the meantime the arbitration were to continue, there would not necessarily be any, or any significant, wastage of costs and time. This is because the next steps in the procedural timetable in this arbitration deal with the filing of pleadings; specifically, the filing of the Respondent’s Statement of Defence and Counterclaim. At some stage of the resolution of the disputes between the parties, in whichever forum or fora this resolution eventually takes place (to put the matter neutrally), the parties will still have to file pleadings or their equivalent. In other words, to require the parties to prepare and file pleadings at this stage would not likely be a waste of costs or time at all. In fact, Mr Masefield suggested that the Respondent' s legal team would be working on the Statement of Defence and Counterclaim even if a stay were to be granted.”
“Accordingly, pursuant tos.68 of the Arbitration Act 1996 , the Claimant seeks an order setting aside the Partial Awards and/or declaring them to be of no effect and the relevant elements of the proceedings pertaining to the Partial Awards will need to be conducted afresh. It will then be a matter for the parties in conjunction with the tribunal when constituted to fix directions for consideration of the appropriate directions for and determination of the matters afresh. 2 It would not be appropriate, in the circumstances, for the matter to be simply remitted to the tribunal to be constituted for reconsideration, given that the serious irregularity pertains to the proceedings themselves and the Partial Awards.”
“When an arbitrator is to be replaced, the Court has discretion to decide whether or not to follow the original nominating process. Once reconstituted, and after having invited the parties to comment, the arbitral tribunal shall determine if and to what extent prior proceedings shall be repeated before the reconstituted arbitral tribunal.”