Philip Hanby Ltd v Clarke (Rev 1)

Only the High Court may grant permission to appeal an arbitral award under section 69 of the Arbitration Act 1996. The Court of Appeal has a residual jurisdiction to set aside a refusal of permission only where there was no legally cognisable decision, or the process was incompatible with article 6 of the Convention. It cannot review the substantive merits, including alleged perversity or legal error.

Administrative failures, delay and confusion over sealed orders do not suffice unless they undermine the judge’s actual decision-making process. Where residual jurisdiction is established, the proper remedy is to set aside the purported refusal and remit the application to the High Court. The Court of Appeal cannot substitute its own grant of permission.

PHL, a former partner in a solicitors’ partnership, referred a dispute arising from its retirement to arbitration. The arbitrator awarded PHL an agreed capital sum, but ordered it to pay the costs of its counterclaim because the partnership’s construction of the retirement deed had prevailed on the liability issue.

Briggs J refused PHL permission under section 69 of the Arbitration Act 1996 to appeal the costs decision and later refused both a review and permission to appeal to the Court of Appeal. PHL relied on delay, a lost court file and inconsistent versions of the orders to contend that the High Court decision was invalid. The central issue was whether those matters engaged the Court of Appeal’s residual jurisdiction over a refusal of permission under section 69.

1. Appeal dismissed for want of jurisdiction. Only a High Court judge may grant permission to appeal an arbitral award under section 69 of the Arbitration Act 1996. The Court of Appeal could not substitute an order granting that permission.
2. The residual jurisdiction of the Court of Appeal is tightly confined. It may intervene where the High Court judge reached no decision properly so called, or where the process producing the decision was incompatible with article 6 of the Convention. That jurisdiction does not permit a review of the merits of the refusal, including an alleged error of law, perversity, or an allegedly wrong exercise of discretion.
3. If a purported refusal falls within either residual category, it is not legally a decision under section 69. The proper course is to set it aside and remit the permission application to the High Court. Section 16 of the Senior Courts Act 1981 supplies the procedural basis for that limited intervention.
4. The court’s administrative failures were regrettable, and the Chancellor apologised for them. However, the delay, reported loss of the file and two versions of the orders did not undermine Briggs J’s decision-making process. The reasoned version of the order showed that he had made a Convention-compliant decision. There was therefore no real prospect of invoking the residual jurisdiction.
5. PHL’s complaints about the arbitrator’s identification of the relevant event for costs, and about the statutory test applied by Briggs J, were complaints about the merits. They could not be recast as a failure to engage with the arguments. The court also observed, without needing to decide the point in detail, that section 61 of the Arbitration Act 1996 states a costs discretion corresponding to that in CPR 44.3(2).

• Court of Appeal (Civil Division) — dismissed PHL’s notice of appeal for want of jurisdiction. The asserted administrative defects did not engage the residual jurisdiction under section 69 of the Arbitration Act 1996.
• High Court of Justice, Chancery Division (Briggs J) — on 24 May 2012 refused permission under section 69 to appeal the arbitrator’s second award; on 24 January 2013 refused a review and permission to appeal to the Court of Appeal.
• Arbitration — Professor Grant Jones awarded PHL £14,395 but awarded the costs of PHL’s counterclaim to the Ringrose Partners.