“According to the fair play of the world, Let me have audience.” William Shakespeare
Whilst Shakespeare’s words echo in English law and legal practice, what fair play actually looks like in our modern, complicated and interconnected world has been the subject of debate of late. Specifically, the topic of bias in arbitration has been put under the microscope by two noteworthy judgments of the English High Court and new International Chamber of Commerce (ICC) guidance on the subject.
At the risk of losing the reader’s attention in the second paragraph, whilst interesting and instructive, these developments have not fundamentally altered the status quo. The two cases reaffirm the supremacy of the well established English common law ‘fair observer test’ as the touchstone by which any accusation of apparent bias will be judged in this jurisdiction. The cases, however, do offer some lessons on how to deal with potential apparent bias and conflict situations which are likely to be of interest to those involved on the ground in arbitrations and adjudications (although we refer to arbitration throughout this article, many of the same principles will apply in adjudication). The updated ICC guidelines are a welcome initiative, but their usefulness is, obviously, limited only to ICC governed arbitrations. This article considers these developments in detail and offers some practical tips to avoid getting caught out.
Test for Apparent Bias
In the already much discussed case of Cofely Ltd v Bingham & Knowles Limited (2016) EWHC 240, Hamblen J considered an application under section 24 of the Arbitration Act 1996 for the removal of an arbitrator, Anthony Bingham, for alleged bias. While the facts of the case may have caught the imagination of those in the industry, the principles applied by Hamblen J are not new. Specifically, Hamblen J affirmed the primacy of the fair observer test for apparent bias from Porter v Magill (2002) AC 357 of whether “the fair minded and informed observer, having considered the facts, would conclude that there was a real possibility that the tribunal was biased.”
Cofely, a major construction company, and Knowles, a well known firm of construction claims consultants, were parties to an arbitration which started in early 2013. Mr Bingham was the arbitrator, having been appointed by the Chartered Institute of Arbitrators. The trouble started in late 2014 when the judgment in Eurocom Ltd v Siemens Plc (2014) EWHC 3710 came out. In that case, Ramsey J had refused to enforce an adjudication award rendered by Mr Bingham on the basis that Siemens had a real prospect of establishing that Mr Bingham had no jurisdiction because of circumstances surrounding his appointment, in which Knowles had been heavily involved. It emerged from that judgment that Mr Bingham had been repeatedly appointed by Knowles, or on behalf of clients of Knowles in cases in which Knowles was involved. He had not declared this prior to or after his arbitral appointment in the Cofely case. Cofely, through its legal advisors, therefore asked a series of questions of Mr Bingham in order to obtain the information it believed necessary to decide