Whether arbitrators had been unfair in refusing to defer award until the outcome of court proceedings
The claimants challenged an arbitration award on the ground of serious irregularity pursuant to section 68 of the Arbitration Act 1996. It was alleged that the arbitrators had breached their section 33 duty under the Act to conduct the arbitration fairly because they had refused to defer their award in order to await the outcome of court proceedings in Ukraine. Those proceedings did not undermine the parties' choice of arbitration, but instead might have provided relevant and important evidence for the arbitration.
Males J accepted that a decision not to defer the issue of an award until further evidence is available is capable of amounting to a breach of the section 33 duty and "to describe such a decision as a case management decision does not advance the matter". However, on the facts, the section 68 challenge failed. Arbitrators are charged with avoiding unnecessary delay and the arbitrators were given no information about the likely time until a decision by the Ukrainian courts. In the end, the delay was relatively short, but the arbitrators' task is to assess the position as it stood at the date of their award.
Balancing the prejudice which might be caused to each side by a deferral, the prejudice to the claimant was held to be only a possibility at the time of the award.
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