ASM Shipping Ltd v Harris
= No treatment has been given--only citation information is available.
[2007] EWHC 1513 (Comm), [2008] 1 Lloyd's Rep 61, (2007) Times, 6 August, [2007] All ER (D) 364 (Jun)
Court: Comml Ct
Judgment Date: 28/06/2007
Catchwords & Digest
ARBITRATION - ARBITRATOR - JURISDICTION - APPLICATION FOR REMOVAL OF ARBITRATORS - APPARENT BIAS - ARBITRATOR STANDING DOWN FOLLOWING JUDGMENT OF HIGH COURT - WHETHER TWO REMAINING ARBITRATORS SHOULD ALSO RECUSE THEMSELVES - WHETHER PARTY LOSING RIGHT TO OBJECT BY ACCEPTING INTERIM AWARD AND BEING AWARE OF RELEVANT CIRCUMSTANCES - ARBITRATION ACT 1996, S 24By a charterparty on an amended Exxonvoy '84 form concluded in December 2000 the owners chartered their vessel to the charterers for a single voyage. The voyage was from 1/2 safe ports/placed Arabian Gulf to 1/2 safe ports/places Red Sea or Egyptian Mediterranean to carry a cargo of gasoil. The charter contained a clause providing for arbitration 'before a board of three persons consisting of one arbitrator to be approved by owner, one by charterer and one by the two so chosen'. The clause contemplated arbitration in New York, but in the event the parties chose London instead. In March 2001, the arbitration began at the behest of the charterers. They claimed damages on the basis that the vessel arrived late at the load port in Kuwait, as a result of the owners' breach of contract. The owners claimed freight and demurrage. The parties appointed H and S as arbitrators. In April 2002, the arbitrators made an award in the owners' favour in respect of their freight claim in the sum of $US640,100 (plus interest and costs). It was agreed that $US707,500 should be paid into an escrow account pending resolution of the remaining claims. In October 2002, the panel dismissed the owners' application for immediate payment of demurrage. Other procedural orders were made. A third arbitrator had still not been appointed, and the two arbitrators continued to conduct the reference alone. In August 2004, they appointed M as the third arbitrator. In October 2004, the three arbitrators conducted a hearing essentially relating to liability for the charterers' claim. In the course of the hearing, the issue arose as to whether one of the arbitrators, M, should recuse himself, but he did not. The ensuing interim award was substantially in the charterers' favour. In January 2005, the owners challenged the award under s 68 of the Arbitration Act 1996, on the ground that M had been wrong not to recuse himself. While that application was pending, the owners asked the other two arbitrators to consider the demurrage claim without M. The arbitrators declined the invitation. In October 2005, the court rejected the s 68 application (see [2006] 2 All ER (Comm) 122). It held that although M should have recused himself from the reference, by 'taking up the award, at the very least' the owners had lost any right they might have had to object to the interim award. After the judgment M resigned. Subsequently, considerable amounts of correspondence were exchanged on the issue of whether or not the other two arbitrators should continue. The owners applied to the court for the removal of them, pursuant to s 24. The issues were (i) whether circumstances that gave rise to justifiable doubts as to the impartiality of the two arbitrators; and (ii) whether the owners were precluded from raising complaints about the two arbitrators continuing or from having the two arbitrators removed because they took part in the proceedings or continued to do so without making their objection timeously. It was contended, inter alia, that bias or an appearance of bias was established by the earlier findings of the High Court in the s 68 application, the fact that evidence would be given by the solicitor said to have had contact with M and the fact that the two arbitrators were party to or supported M's decision not to recuse himself, in submissions before the s 68 hearing and in M's subsequent actions. Further grounds included that the arbitrators had not been awarded costs of the s 68 hearing and that they refused to stand down despite the judgment in that hearing..
Held - The application would be dismissed. On the facts, the owners had lost the right to raise objections of bias. They were aware of the matters relied upon but continued with the case before the two arbitrators until after the judgment of the High Court on the s 68 application. A fair minded observer would not think that there was any realistic risk that the two arbitrators would be biased.
