Benaim (UK) Ltd. v Davies Middleton & Davies Ltd

Applications challenging an arbitral award under sections 24, 68 and 69 of the Arbitration Act 1996 require a clear procedural failure, substantial injustice or an obvious error of law. Section 68 is a long-stop remedy for extreme cases and cannot be used to reargue factual or evidential issues. An arbitrator need decide the disputes necessary to resolve the arbitration, but need not address every subsidiary argument. A reasoned award need not explain every evidential step if its decisive reasoning is clear. For section 69, an error in applying a correct legal principle to the facts is not ordinarily an error of law, and a decision within the permissible range of solutions is not obviously wrong.

Benaim (UK) Ltd. challenged an interim arbitration award obtained by Davies Middleton & Davies Ltd. concerning the design and construction of the A13 viaduct. Benaim sought removal of the arbitrator under section 24 of the Arbitration Act 1996, setting aside of the award for serious irregularity under section 68, and permission to appeal on questions of law under section 69.

The challenges concerned the scope of a split liability and quantum hearing, findings about the buildability and design of the viaduct, the Schedule of Principal Quantities, delay, reasons in the award, and alleged errors of law.

1. Section 24. The arbitrator was entitled to determine issues concerning delay to the design, mould manufacture and the start of construction. The parties had treated those matters as part of the first hearing, and had not defined the boundary between liability and quantum clearly. Removal was therefore refused.
2. Section 68. Serious irregularity requires a failure of fair procedure or failure to decide an issue necessary to resolve the dispute, together with substantial injustice. The provision is a long-stop remedy and cannot provide an indirect appeal on fact, evidence or reasoning. The arbitrator was entitled to define buildability by reference to structural performance and practical construction, to make findings on the 1200 mm deviator block, and to assess the expert and engineering evidence.
3. The award gave adequate reasons. It identified the decisive issues and explained why the Tender Design Proposal was inadequate, why changes were made, and why delay resulted. The arbitrator was not required to answer questions designed to cross-examine him on every step of his reasoning.
4. Section 69. No appeal lay. The arbitrator correctly treated the Schedule of Principal Quantities as an obligation owed to both contractors and qualified by reasonable skill and care. Increased quantities did not establish a rule of law, and the findings on strut-and-tie calculations, prestress and reinforcement were supported by the pleadings and evidence. None of the alleged errors was obviously wrong.
5. The applications under sections 24, 68 and 69 were dismissed.

First-instance decision on applications challenging an interim arbitral award. No prior appellate decision is stated in the judgment.