E v F

When considering an out-of-time amendment to an arbitration challenge, the court must apply the statutory framework and consider all material circumstances. The Kalmneft factors provide guidance but are not a closed checklist. An existing in-time challenge and the absence of practical delay to the final hearing are relevant, but they do not remove the importance of delay, finality and the statutory objective of avoiding unnecessary delay or expense. A substantial delay may therefore justify refusing amendments even where there is no irremediable prejudice and the substantive hearing will proceed on time.

F and the State were parties to an investment arbitration conducted under a bilateral investment treaty and the UNCITRAL Rules 1976. The Tribunal found by a majority that it had jurisdiction and ordered the State to pay compensation. The State commenced timely Commercial Court challenges under sections 67 and 68 of the Arbitration Act 1996, then applied to add further grounds 162 days after the Award. The opposed amendments were said not to delay the substantive hearing. The issue was whether, applying section 80(5) and the relevant authorities, the amendments should be permitted.

1. The State’s opposed amendments were refused. The court held that the statutory framework governed the application and that the factors identified in Kalmneft, as described in Terna, were guidance rather than a closed list. The court was required to consider all material circumstances.
2. The fact that the challenge had been commenced within time, and that the amendments would not practically delay the listed substantive hearing, could be taken into account. Those circumstances did not justify imposing a separate or additional test. The policy against late challenges could remain significant where an in-time claim was followed by a substantial expansion of the issues.
3. The amendments were proposed 162 days after the Award, more than five times the statutory period. The State had not shown that it acted reasonably in allowing that delay. Neither F nor the arbitrators had caused or contributed to it. F would not suffer irremediable prejudice, the arbitration had not continued during the delay, and the strength of the amendments could not reliably be assessed at the interim stage.
4. Although the State’s challenge was treated provisionally as a solid claim and the amendments would not postpone the hearing, those matters did not overcome the weight of delay. Extending the compass of the dispute at that stage compromised finality and was inconsistent with the statutory objective of fair resolution without unnecessary delay or expense.
5. The refusal did not prevent the State from relying on matters already raised by the unamended statement of case. The Commercial Court would not adopt an over-technical approach to pleadings. The parties were directed to cooperate before the case management conference to reduce the time required for the substantive hearing, with possible consideration of bringing that hearing forward.