ARBITRATOR BREACHED DUTY TO ACT FAIRLY BY SEEKING AN OPINION FROM A THIRD PARTY AND CONDUCTING HIS OWN RESEARCH
By Richard Bamforth and Liz Williams
The Commercial Court has remitted an award to the arbitrator for reconsideration on the basis of serious irregularity after the arbitrator sought the opinion of a third party and conducted his own research without notifying the parties.
Background Fleetwood Wanderers Limited (t/a Fleetwood Town Football Club) v AFC Fylde Limited [2018] EWHC 3318 (Comm) concerned a dispute arising out of the transfer of a professional footballer. It was alleged that Fleetwood had procured a repudiatory breach of the player’s contract with Fylde. Fylde commenced an arbitration against Fleetwood under the Football Association Rules and FIFA’s Regulations on the Status and Transfer of Players (RSTP). A question arose as to whether the RSTP was binding in domestic disputes between clubs.
The arbitrator sought the opinion of the FA’s judicial services manager on this issue before rendering his award. He neither notified the parties of this approach nor gave them any opportunity to make submissions on the opinion once it was received. Based partly on this opinion and on research he had carried out himself on the internet, the arbitrator found that Fleetwood was liable to pay compensation to Fylde. Fleetwood challenged the award under section 68(2)(a) of the Arbitration Act 1996 on the grounds that the arbitrator had failed to comply with his general duty under section 33(1) to “act fairly and impartially as between the parties, giving each party a reasonable opportunity of putting his case” and that this had caused substantial injustice to Fleetwood. The court’s decision Duty to act fairly and impartially The court reiterated that an arbitral tribunal should give the parties an opportunity to make submissions on any issue that may be relied upon by it as the basis of its award. The parties are entitled to assume that the tribunal will base its decision solely on the evidence and arguments presented by them prior to the making of the award. The acts of the arbitrator in seeking an opinion from the FA and conducting his own research without notifying the parties constituted a breach of his general duty under section 33(1) and thus a serious irregularity under section 68(2)(a).