Smyth-Tyrrell & Anor v Sowden

An application to challenge an arbitration award must ordinarily be brought within the 28-day period in section 70(3) of the Arbitration Act 1996. An extension is exceptional because the Act gives priority to speedy finality. The court should consider the length of delay, the applicant’s reasonableness, any contribution by the respondent or arbitrator, irremediable prejudice, the effect on the arbitration, the apparent strength of the challenge and overall unfairness. The length of delay, the applicant’s conduct and any contribution to delay are primary factors. The court should not conduct a substantial merits inquiry at this stage. A legally represented party who gives no satisfactory explanation for failing to issue the claim form within time may be refused an extension, even where the delay causes no irremediable prejudice.

The claimants, landlords, sought an extension of about 30 days to issue a claim challenging a final arbitration award concerning agricultural holdings. The arbitration was conducted under the Agricultural Holdings Act 1986, and the proposed challenge was made under the Arbitration Act 1996. The claimants issued an application notice within 28 days of the award but issued the claim form outside that period. Both parties had also asked the arbitrator to address points under section 57, although that process was continuing.

The central issues were whether the section 57 process affected the time limit and, if not, whether the court should extend time under the principles applicable to arbitration challenges.

1. The application for an extension of time was refused. The claim form had been issued about 30 days late. The court accepted that the continuing section 57 process might affect time for the narrower points raised before the arbitrator, but it did not provide a basis for the wider challenge advanced in the claim form.

2. The court followed the approach identified in Peel v Coln Park LLP [2010] EWCA Civ 1602, Compton Beauchamp Estates Ltd v Spence [2013] EWHC 1101 (Ch), K v S [2015] EWHC 1945 (Comm) and Terna Bahrain Holding Company Wll v Al Shamsi [2013] 1 Lloyd's Report 87. Although the arbitration arose under agricultural holdings legislation and was compulsory, the usual Arbitration Act principles governed extensions of time.

3. The relevant factors were the length of delay; whether the applicant acted reasonably; whether the respondent or arbitrator caused or contributed to the delay; irremediable prejudice beyond loss of time; the continuation and impact of the arbitration; the apparent strength of the challenge; and whether it would be unfair to deny determination of the challenge. The first three factors were primary. The policy of the Act required an exceptional departure from the statutory timetable.

4. The claimants had provided no real explanation for failing to issue the claim form when they issued the application notice. They were legally represented and familiar with the proceedings. The respondent had not materially contributed to the delay, there was no irremediable prejudice, and the merits of the proposed challenge could not be assessed at that stage. Those matters did not outweigh the unexplained delay and the statutory policy of finality.

5. The court concluded that it was too late to permit the claim form to proceed and refused the extension.