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Methods of Challenge in Arbitration.

Posted on 16/10/2016 · Posted in Arbitration

There are a number of possibilities for challenge in arbitration, with most arising at the beginning of the arbitration proceedings, some arising at any point throughout the arbitration, and those arising even after an award has been made.

Challenging the arbitrator

In some cases a party may wish to challenge the arbitrator’s jurisdiction, and this can either be comprehensive or partial; a comprehensive challenge relates to the arbitrator’s authority to decide all aspects of the dispute between the parties, whereas a partial challenge refers to the arbitrator’s authority to decide a particular claim or point. The majority of rules and laws relating to arbitration challenge state that a party who wishes to make such a challenge should raise their concerns at the outset of the arbitration.

Under section 24 of the English Arbitration Act 1996 a party is also able to challenge the arbitrator if there is reason to doubt the arbitrator’s impartiality, stating a party may “apply to the court to remove an arbitrator on [the grounds that] circumstances exist that give rise to justifiable doubts as to his impartiality.” Other grounds on which an arbitrator could be challenged are lack of necessary qualifications to pull together the arbitration agreement, physical or mental incapacity, or a refusal or failure to conduct proceedings properly or to make an award. As might be expected, successful challenges against arbitrators are relatively rare in English arbitration proceedings, and challenges are sometimes made with tactical aims in mind rather than in a genuine attempt to remove the arbitrator.

The ultimate measure of a man is not where he stands in moments of comfort and convenience, but where he stands at times of challenge and controversy”
Martin Luther King, Jr.

Challenging an award

In most countries across the globe, arbitration rules will stipulate that the awards resulting from an arbitration proceeding are final and binding, and this is one of the key draws of arbitration as a means of dispute resolution for many corporations and individuals. However, unless otherwise agreed at the start of an arbitration proceeding, an award may be appealed before the courts on a question of English law (under section 69 of the English Arbitration Act 1996). The three grounds on which an award might be challenged are jurisdiction, serious irregularity, or on a point of law. Before applying to a court, a party must first explore all possible options with the arbitrator to amend or add to the award.

As explained above, a jurisdiction based challenge challenges the arbitrator’s authority and might address part or the entirety of the arbitration agreement.

Challenge on the ground of serious irregularity may be because a party feels the arbitrator did not act fairly, was the cause of undue delay or expense, or in cases where the award was obtained fraudulently or against public policy.

Challenge on a point of law can be made with the agreement of all the parties taking part in the arbitration or with permission of the court, and must be proven to be essential to proceedings.

Upon an award being challenged, the court may confirm the award, amend the award, ask the arbitrator to reconsider the award either in whole or in part, or even set the award aside altogether.

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Disclaimer – Please confirm any of the above views with your solicitor. Expert Evidence takes no responsibility or provides any guarantee that the views above are correct for your particular case or jurisdiction.