Soletanche Bachy France SAS v Aqaba Container Terminal (Pvt) Co

An arbitrator has a continuing duty to disclose circumstances which might reasonably give rise to justifiable doubts about impartiality. A further disclosure is required only where later events create a material change in the essentials of the previously disclosed position. Non-disclosure does not itself establish apparent bias; the court must assess objectively whether a reasonable observer would conclude that there was a real risk of lack of impartiality.

For an application under section 68 of the Arbitration Act 1996, failure to deal with an issue requires the issue to be essential to the decision and genuinely left undecided. If the tribunal has dealt with it, the court does not review the quality of that determination. Any procedural irregularity must also cause substantial injustice.

The claimant applied under sections 67 and 68 of the Arbitration Act 1996 to set aside an arbitration award concerning the termination of a construction contract. The claimant challenged the award on four grounds: an arbitrator’s alleged continuing failure to disclose his later involvement with a replacement contractor; failure to determine issues concerning future delay and extensions of time; failure to give a proper opportunity to address concurrent delay; and the tribunal’s correction of an award initially issued without its appendices.

The arbitration tribunal had found that the defendant was entitled to terminate because the claimant was proceeding without due diligence and without delay. The central questions were whether the tribunal had failed to determine essential issues, whether any procedural irregularity caused substantial injustice, and whether the correction process affected substantive jurisdiction.

1. Disclosure and apparent bias. The arbitrator was subject to a continuing duty of disclosure. However, the disclosed retainer of the replacement contractor did not require further disclosure merely because the related dispute later became an arbitration or because the arbitrator subsequently met the contractor’s client. There had been no material change in the essentials of the disclosed position. In any event, applying the objective test, no reasonable observer would have concluded that there was a real risk of lack of impartiality. The first ground therefore failed, consistently with the approach in Halliburton Co v Chubb Insurance Limited [2018] 1 WLR 2361.
2. Failure to deal with issues. The tribunal had to decide issues essential to the result, but it had addressed the claimant’s arguments about future extensions of time, future delay and the prospects of completing the works. Its conclusion that the termination analysis should not look forward to speculative future developments was a determination of those issues, whether or not the reasoning was correct. Section 68(2)(d) did not permit an appeal on the merits. The principles stated in The Secretary of State for the Home Department v Raytheon Systems Limited [2014] EWHC 4375 (TCC) were applied, and Petrochemical Industries Co (KSC) v Dow Chemical Co [2012] 6 Lloyds Reports 691 explained that omission from a list of issues was not conclusive.
3. Concurrent delay. Even assuming that the tribunal had failed to give a sufficient opportunity to address concurrent delay, the claimant had not shown substantial injustice. The alleged additional extension of time could not be shown to have materially affected the award.
4. Correction of the award. Section 67 concerns substantive jurisdiction, namely the existence of a valid arbitration agreement, the constitution of the tribunal and the matters submitted to arbitration. It does not apply to an alleged irregularity in accepting corrections out of time. Following Union Marine Classification Services LLC v Comoros [2015] 2 Lloyds Reports 49 (QB), approving CNH Global NV v PGN Logistics Ltd [2009] EWHC 977 (Comm), any such defect would fall under section 68 and require substantial injustice. The issue was in any event properly dealt with by issuing a fresh corrected award and allowing a fresh 30-day period for corrections.
5. The application was dismissed on all four grounds.