Virdee v Virdi

A decision made under section 18 of the Arbitration Act 1996 may be appealed only with the permission of the judge who made it. That restriction applies to decisions concerning the appointment and qualifications of arbitrators.

Where the Act contains no express restriction on an otherwise available appeal, the ordinary appellate jurisdiction remains available. An arbitration agreement may amount to an agreement under section 36 excluding unilateral legal representation, even without express words. Such an agreement does not necessarily prevent the tribunal from obtaining legal assistance when needed. An exclusion of appeals on questions of law under section 69 must be established by the proper interpretation of the agreement.

Two brothers entered into an agreement for the informal arbitration of numerous disputes by members of their Sikh community. After the original award was set aside by consent, Judge Hallgarten QC reconstituted the tribunal and ruled on the qualifications of the arbitrators, legal representation and costs. He also indicated that an appeal on a question of law was excluded.

The claimant appealed. The Court of Appeal first had to determine whether statutory restrictions deprived it of jurisdiction. The remaining issues concerned whether the agreement excluded unilateral legal representation, how the related costs question should be resolved, and whether access to the court under section 69 of the Arbitration Act 1996 had been excluded.

1. Jurisdiction concerning appointment of arbitrators. The appeal was allowed in part unanimously. Brooke LJ, with whom Buxton LJ and Morland J agreed, held that the appointment and required characteristics of the replacement arbitrators fell squarely within section 18 of the Arbitration Act 1996. Section 18(5) made the judge's decision final unless that judge granted permission to appeal. As Judge Hallgarten QC had refused permission, the Court of Appeal lacked jurisdiction to consider whether the party-appointed arbitrators had to be Sikhs or whether section 19 had been applied correctly.

2. Jurisdiction over the remaining issues. The requests for rulings about legal representation, costs and exclusion of appeals under section 69 were not made under any provision of the Act containing an appellate restriction. Applying Inco Europe Ltd v First Choice Distribution [2000] 1 WLR 586, the Act was not to be read as removing an appellate jurisdiction available under the Supreme Court Act 1981 unless it did so expressly. The ordinary permission requirements in Part 52 of the Civil Procedure Rules 1998 therefore applied.

3. Legal representation. On its proper interpretation, the arbitration agreement was an agreement to the contrary for the purposes of section 36. Its informal structure, its provisions for the brothers to make their own representations, and its requirement that final submissions be made personally showed that neither party could unilaterally instruct a lawyer to appear from the outset. The county court's unrestricted declaration permitting representation therefore went beyond the agreement. Buxton LJ added that the exclusion extended to distinctively legal issues.

4. The agreement did not prevent the tribunal itself from deciding, in the exercise of its case-management powers, that it needed legal assistance on a difficult legal issue. Any such assistance would remain subject to the requirement that final submissions be made personally.

5. Costs and questions of law. The declaration concerning the costs of party-appointed lawyers fell away with the ruling on representation. The tribunal could determine responsibility for the legally qualified chairman's fees and, if it permitted legal argument on a particular issue, could hear argument about the costs of that issue. The agreement did not exclude access to the court on a question of law under section 69. Permission to appeal that point was refused. The claimant received half the costs of the appeal, subject to the rules governing a litigant in person.

1. Court of Appeal (Civil Division): In [2003] EWCA Civ 41, held that it lacked jurisdiction over the section 18 issue, varied the county court's order concerning legal representation and related costs, and refused permission to appeal on exclusion of section 69 appeals.

2. Central London County Court: Judge Hallgarten QC set aside the original award and removed the arbitrators by consent. He reconstituted the tribunal, held that the party-appointed arbitrators need not be Sikhs, and declared that either party could be represented by a lawyer or other chosen person.

3. Permission stage: Mance LJ granted limited permission concerning the qualifications of the arbitrators and legal representation, while adjourning the costs and section 69 applications to the full court.