STN v POR

Under Arbitration Act 1996, s. 68(2)(d), a tribunal must determine each issue put to it, although it may address issues together and need not give adequate reasons if it has in fact decided them. The award must be read fairly and commercially, but the parties must be able to tell that an issue was determined. A failure to decide a distinct issue may cause substantial injustice where the outcome might well have been different. Contractual arbitration rules may displace the default recourse under s. 57, so that failure to seek correction or an additional award does not necessarily bar a s. 68 challenge. The court may remit the affected issue for reconsideration rather than set aside the award.

A professional footballer challenged an arbitral award under s. 68 of the Arbitration Act 1996. His former agent had succeeded in a claim for transfer commission, while the footballer’s counterclaim alleging breaches of contract and fiduciary duty had been dismissed. The challenge raised four complaints: that the arbitrator had omitted a distinct limb of the counterclaim; relied on an unpleaded case or private expertise concerning a mandate agreement; failed to give the footballer a fair opportunity to pursue an alleged payment by another club; and inadequately addressed a witness’s evidence. The court considered whether any complaint established a serious irregularity causing substantial injustice.

1. The challenge succeeded only in relation to the omitted limb of the counterclaim. The award was remitted to the arbitrator for reconsideration of that limb and whether it affected the award’s overall conclusion. The court rejected the other grounds.

2. Rule K10.2 of the FA Rules excluded applications to the tribunal under s. 57 of the Arbitration Act 1996. “Recourse” included an application to the tribunal itself, and the wording mirrored s. 70(2). The parties’ agreement therefore engaged ss. 57(1) and 57(2), displacing the default s. 57(3) process. The challenge was not barred for failure first to seek s. 57 relief. The court also agreed with the caution expressed in Czech Republic v Diag Human SE [2024] EWHC 503 (Comm) that s. 57 should not become a routine preliminary step to every s. 68 challenge.

3. For s. 68(2)(d), the second limb of the counterclaim was a distinct issue put to the arbitrator. Read fairly and commercially, the award’s discussion concerned the alleged secret commission, not the separate claim about an overpayment by Club 1 and its effect on the footballer’s wages. The short dismissal paragraph did not make clear that the second limb had been determined. A tribunal need not address issues one by one, and inadequate or mistaken reasoning is not itself a failure to deal with an issue; the parties must, however, be able to tell that the issue was decided.

4. The omission caused substantial injustice. It was unnecessary to show that a different result was probable: it was enough that the result might well have been different. Because the arbitrator had not addressed the elements of the second claim, a different result was possible in the nature of things. The modest amount potentially at stake did not alter that conclusion in the context of the comparatively modest sums in dispute.

5. The mandate agreement complaint failed. The defendant’s case that it could use human agents when required had been advanced in the arbitration, and the claimant had an adequate opportunity to answer it. Disagreement with the arbitrator’s reasoning or the effect of a contractual clause did not establish a s. 68 irregularity. Nor had the arbitrator improperly used private expertise: he used his experience to evaluate the parties’ evidence, rather than to supply evidence for a party.

6. The alleged Club 4 payment was not an issue the arbitrator was required to decide. It was not pleaded, and references to a document, cross-examination and closing submissions did not clearly put the payment forward as a basis for the account claim. No procedural irregularity was shown in the handling of the late material. The challenge concerning the witness’s evidence also failed: assessment of a witness and the weight of her evidence did not, on these facts, establish serious irregularity.

7. The court remitted the omitted counterclaim limb to the original arbitrator. It expressed doubt that s. 68 alone permitted remission to a newly constituted tribunal and noted that no application under s. 24 had been made.

not stated in the judgment.