Bandwith Shipping Corp. v Intaari

Section 68 of the Arbitration Act 1996 permits intervention where a tribunal’s failure to comply with its duty to act fairly and give each party a reasonable opportunity to present its case causes substantial injustice. The question is assessed objectively in the context of the arbitration as a whole. A point need not have been pleaded in its final form if the issues and its essential basis were sufficiently placed in the arena. The court should not treat the Departmental Advisory Committee’s description of section 68 as adding requirements to the statutory language. The section 68 jurisdiction does not provide an appeal on the tribunal’s findings of fact.

The Owners sought remission of an arbitral award under section 68(2)(a) of the Arbitration Act 1996. The tribunal had awarded the Charterers relief by finding that a breach of the vessel’s ice-breaking warranty caused sufficient delay to make the difference between escaping the Antarctic and wintering there.

The Owners argued that the tribunal had relied on a late and insufficiently identified 17-hour causation point without giving them a reasonable opportunity to respond. The central questions were whether the point had been sufficiently raised during the arbitration and, if so, whether any failure to afford a further opportunity caused substantial injustice.

1. The application to remit the award under section 68(2)(a) of the Arbitration Act 1996 was refused. The Owners had a reasonable opportunity to deal with the causation point.
2. The statutory test is whether the tribunal failed to comply with section 33(1) and whether that failure caused or will cause substantial injustice. The court should intervene cautiously, but the statutory wording governs. The language of the Departmental Advisory Committee’s report should not be treated as an additional statutory test.
3. The issue was not confined to the Charterers’ original case that the vessel would have returned to Cape Town in mid-May. From the outset the Charterers had identified periods of delay before 30 May and alleged that they were caused by breach of warranty. The Owners denied any causative effect. That joinder of issue placed the consequences of any proven delay in the arena.
4. The Charterers’ closing oral submissions made the narrower case sufficiently clear. Objectively understood, they contended that, without the breach, the vessel would have reached Novo and departed a few days earlier. The Owners’ intervention concerning the effect of an earlier hurricane showed that they had understood the essential point. The tribunal was not required to invite further submissions merely because it did not do so during or after the reply.
5. Following Bullfracht (Cyprus) Ltd v Boneset Shipping Co Ltd [2002] 2 Lloyd’s Rep 681, a tribunal ordinarily must give parties an opportunity to address a new material primary factual finding, but need not generally seek submissions on every inference from primary facts. A conclusion about what would have happened absent breach was closer to a material primary fact, although in this case the point had been sufficiently raised.
6. Even if there had been a serious irregularity, remission would not have been refused merely because the court considered the tribunal’s factual conclusion debatable. Section 68 is not an appeal on fact, as confirmed in Claire v Thomas Water Utilities Ltd [2005] 1 BLR 366. The court could not say that the Owners’ answer had plainly no prospect of succeeding, but the threshold issue of reasonable opportunity was decisive.

The judgment concerns an application to the High Court for remission of an arbitral award. No appeal from an earlier court judgment is stated.