Goel & Anor v Amega Ltd

An arbitrator’s robust case management does not, without more, establish apparent bias. The court must assess all relevant circumstances and ask whether a fair-minded and informed observer would conclude that there was a real possibility of bias. In applying section 24 of the Arbitration Act 1996, there is no separate requirement to prove substantial injustice in addition to apparent bias. An arbitrator must act fairly and impartially, adopt procedures suitable to the case, avoid unnecessary delay and expense, and require reasonable co-operation from the parties. Decisions to proceed with hearings, refuse stays, impose directions or make peremptory orders may properly be made to secure efficient progress, particularly where delay is caused by a party’s own conduct.

The claimants employed the defendant to construct their house under a contract incorporating the JCT Minor Works form. Following termination, the defendant commenced proceedings for sums allegedly due. Those proceedings were stayed for arbitration at the claimants’ insistence, and an adjudication award was paid.

The claimants later applied under section 24 of the Arbitration Act 1996 to remove the arbitrator for alleged bias. They relied on decisions concerning preliminary hearings, procedural directions, refusal of a stay, continuation of a hearing in their absence, and a peremptory order. The central issue was whether those matters would lead a fair-minded and informed observer to conclude that there was a real possibility of bias.

1. Application refused. The claimants’ application to remove the arbitrator was entirely without merit.
2. The applicable test was that stated in Re Medicaments and Related Classes of Goods (No. 2) [2001] WLR 700 and adopted in Porter v Magill [2002] AC 357. The court had to ascertain all circumstances bearing on the allegation and ask whether a fair-minded and informed observer would conclude that there was a real possibility, or real danger, of bias.
3. There was no separate or additional requirement under section 24 of the Arbitration Act 1996 to establish substantial injustice beyond apparent bias. Apparent bias itself ordinarily constituted, or would give rise to an anticipation of, substantial injustice in relation to the arbitrator’s further participation.
4. The policy of the Arbitration Act 1996 was to uphold party autonomy and restrict unnecessary court intervention. The arbitrator’s express duties under sections 33 and 40 required fair and impartial conduct, suitable and efficient procedures, avoidance of unnecessary delay and expense, and party co-operation.
5. The arbitrator was entitled to proceed with the preliminary hearings despite the claimants’ failures to attend or instruct their solicitors, to refuse a stay sought after repeated procedural delays, and to impose a peremptory order where no adequately particularised defence and counterclaim had been served. Those were legitimate case-management decisions and did not indicate bias. The criticisms were individually insufficient and, taken together, reinforced the conclusion that the application formed part of a deliberate course of disruption.

The judgment records that the defendant’s earlier court proceedings were stayed for arbitration and that an adjudication decision had been paid. No earlier court judgment is stated.