Konig & Anor v Zwiebel & Anor

In construing an arbitral award, the court must consider its factual and procedural context. A passage recording a jurisdictional objection does not make the substantive award optional or ambiguous where it identifies the basis of the award and the consequence of a timely challenge. Under sections 67, 70(3) and 73 of the Arbitration Act 1996, a jurisdiction challenge must be made within 28 days of publication. If no challenge is made, the operative award takes effect. The court also indicated, obiter, that clarification may be communicated directly or indirectly where the arbitrators’ intended meaning is clear.

The appellants appealed against Burton J’s refusal to set aside an order made by Field J without notice, which gave leave under section 66 of the Arbitration Act 1996 to enforce an award made by two rabbis appointed by the Beth Din. The dispute concerned the assets and sale proceeds of a company. The appellants argued that paragraph B of the award contradicted paragraph A, made performance optional, or rendered the award ambiguous until clarified. The central issue was whether the award was a valid and enforceable determination when construed against the procedural history, including the relevant consent orders.

1. Appeal dismissed. Longmore LJ delivered the judgment, with Thorpe LJ and Bodey J agreeing.
2. The award had to be construed in the light of the dispute’s procedural history. Paragraph B did not give the respondents an option whether to comply with paragraph A. It recognised that the accountants had proceeded under the second consent order and that the respondents contended that order was invalid because they had not authorised or agreed to it.
3. The effect of paragraph B was that, if the factual objection were correct, the award could be challenged for want of jurisdiction under section 67 of the Arbitration Act 1996. It did not make the award merely voluntary or contradict the substantive declaration in paragraph A.
4. In the absence of a jurisdiction challenge within 28 days of publication, under sections 67, 70(3) and 73 of the Arbitration Act 1996, paragraph A took effect. The later challenge to the validity of the second consent order was therefore made too late.
5. On its proper construction, the award was valid and enforceable on its face and contained no uncertainty or ambiguity. The award could accordingly be enforced as a judgment under section 66.
6. Longmore LJ further indicated, obiter, that clarification could be made directly or indirectly if the arbitrators made their intended clarification sufficiently clear. That issue was immaterial because the award was enforceable without reliance on the later clarification.

• Court of Appeal (Civil Division) — dismissed the appeal against Burton J’s order: [2009] EWCA Civ 892.
• Queen’s Bench Commercial Division — Burton J refused to set aside Field J’s enforcement order.
• Field J — made a without-notice order giving leave to enforce the arbitral award as a judgment under section 66 of the Arbitration Act 1996.