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In the recent case of Collins & Ors v WEH [2025] EWHC 40 (Comm), the High Court of England and Wales illustrated its support for arbitrators who stand firm in their decisions and resist attempts by parties to delay proceedings, especially when those parties have failed to act diligently in their own interests.
Background
The arbitration centred on whether Wind Energy Holding Company Ltd (WEH) breached a letter of indemnity by failing to cover the claimants’ costs in related litigation. In summary, developments in that litigation had led to requests by the claimants’ to adjourn an evidentiary hearing. These developments included a freezing order being made against the claimants, which they argued had a material impact on their ability to funding legal representation in the arbitration.
Despite the claimants’ requests, the arbitrator refused to significantly delay the hearing, resulting in, inter alia, the claimants being unable to file an adequate pre-hearing brief and be represented. The arbitrator went on to dismiss the claimants’ claims and granted WEH’s counterclaim, whereupon the claimants applied to set aside the award on grounds of serious procedural irregularity under Section 68 of the Arbitration Act 1996 (the Act). They asserted that this irregularity had arisen from breaches by the arbitrator of her duties under Section 33 of the Act, which requires arbitrators to act fairly and impartially, give each party a fair chance to present their case, and adopt suitable procedures that avoid unnecessary delays while ensuring a just resolution.
Key Procedural Issues and the Court’s Findings
The claimants argued that this refusal constituted a serious irregularity principally on the basis that it left them without legal representation and time to prepare. They also stated that the first claimant had unfortunately, shortly before the hearing, suffered a breakdown and needed time to recover. The Court dismissed both as grounds for impugning the decision that the arbitrator had reached in the circumstances before her.
The Court held that the claimants’ lack of representation was the product of their own delay in addressing the consequences of the freezing order. Although the order was made in July 2022, they did not inform the arbitrator about its existence, let alone its effects on their ability to pay their lawyers, until one month later - that being just two weeks before the original date of the hearing. Even after a short (three-week) extension to that date was granted, the claimants then failed to make any realistic attempts to resolve their issues with the freezing order (for example by a proper application to vary/clarify it) and failed to provide the arbitrator with a clear timeline in which they would do so. Accordingly, the Court found that the arbitrator’s decision to eventually proceed with the hearing was fair and consistent with her duties under Section 33 of the Act.
The Court further noted, in reaching its conclusions, that at all material times, the arbitrator ensured that the claimants, although unrepresented, were fairly treated and understood their right to fully participate in the hearing.
Regarding the first claimant’s mental health difficulties, the Court noted these were flagged at the last minute (two days before the hearing), made no reference to the first claimant’s having suffered a breakdown (a statutory sick note was submitted to the arbitrator), and that the arbitrator had not been asked to adjourn on the basis of these problems. Consequently, it was held that the arbitrator acted fairly when proceeding without delay. In addition, the Court found that the first claimant’s absence caused no serious injustice, as the second claimant who attended the hearing, could represent the claimants effectively.
A further ground relied upon by the claimants concerned the status of a (80-page) draft sur-reply filed two business days before the hearing. This was accompanied by five new witness statements (three unsigned), an expert report, and a new exhibit.
Despite objections from WEH, the arbitrator had permitted the draft sur-reply to stand as a pre-hearing brief and admitted the rest of the documents, but excluding the three unsigned witness statements. Nonetheless, the claimants argued that fairness required their admission in full, and that WEH could be given time to respond.
Noting that the material had been nearly final since earlier in the year, the arbitrators’ treatment of the rest of the material, and the fact that she had already received a number of witness statements, the Court rejected the argument that her exclusion of the unsigned statements was unfair.
The claimants also contended that the arbitrator failed to act fairly and impartially by not testing the credibility of WEH’s main witness or the strength of WEH’s case during the hearing. The Court rejected this submission, noting that the claimants had ample opportunity to participate in the hearing, legally represented or not, and in person or remotely. The Court stated that it was for the arbitrator to determine the extent to which she found it necessary to probe WEH’s evidence and submissions.
Conclusion
The decision exemplifies the English courts’ “hands off” approach to arbitrators’ procedural decisions in English seated arbitrations. In particular, it illustrates how Section 68 provides a high threshold aimed at serious procedural misconduct, rather than the discretionary management of proceedings, thereby helping to uphold both the authority of arbitrators and the efficiency of arbitration as a dispute resolution mechanism. The overall message for parties who foresee difficulties with a procedural calendar is to act promptly and diligently, both in raising them and in seeking to find solutions - as arbitrators are not obliged to accommodate every request for modifications irrespective of the circumstances.
Click here for a copy of the judgment.21 January 2025
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