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OVERVIEW
Section 70(3) of the Arbitration Act 1996 ("the Act") provides as follows:
"Any application or appeal must be brought within 28 days of the date of the award or, if there has been any arbitral process of appeal or review, of the date when the applicant or appellant was notified of the result of that process."
At first blush this wording, which is also to be found in in the 2025 revisions to the Act, might be said to suggest that where a party wishes to make a challenge to the English Court in respect of a FOSFA or GAFTA board of appeal award, it has 28 days from the date it receives the appeal award, and so learns of the result, to bring that challenge.
Such an outcome would be out of step with the usual position under the Act that time for any challenge to the Court runs from the date of the award itself. It would also create scope for uncertainty as to when exactly the 28 day period commences and give rise to the possibility that the 28 day period could commence at different points in time for each of the parties.
Until now, this is an issue which has not received authoritative consideration by the English courts. Previously there had been obiter comments from Gross J in UR Power GmbH v Kuok Oils and Grains Pte Ltd [2009] 2 Lloyd's Rep 495 and Hamblen J in Pec Ltd v Asia Golden Rice Co Ltd [2013] 1 Lloyd's Rep 82 as to the likely interpretation of section 70(3). Whilst both of ...
Until now, this is an issue which has not received authoritative consideration by the English courts. Previously there had been obiter comments from Gross J in UR Power GmbH v Kuok Oils and Grains Pte Ltd [2009] 2 Lloyd's Rep 495 and Hamblen J in Pec Ltd v Asia Golden Rice Co Ltd [2013] 1 Lloyd's Rep 82 as to the likely interpretation of section 70(3). Whilst both of the aforementioned judges were of the view that time should run from the date of the appeal award, their reasons differed for this conclusion. Gross J was seemingly of the view that the words "arbitral process of appeal or review" did not apply to GAFTA or FOSFA Board of Appeal awards at all. Hamblen J however doubted this but stated that one possible answer was to construe the second half of section 70(3) as only applying in cases where the appeal or review does not culminate in an award.
The Court has now provided a definitive answer to this question in JSC Kazan Oil Plant v Avez Trade DMCC [2025] EWHC 2713 (Comm). The Court had before it a section 69 challenge from the FOSFA Board of Appeal which had been brought within 28 days of the relevant appeal award being released to the parties but more than 28 days after the date of the award itself. The Defendant (who had been successful before the Board of Appeal), sought to strike out the appeal on the basis that it had been brought out of time. It was accordingly necessary for the Court to determine the correct interpretation of section 70(3) of the Act.
The Court was of the view that, based on authority relating to section 70(2) of the Act (which requires parties to exhaust any arbitral process or appeal or review before making a challenge to the English Courts), the words "arbitral process of appeal or review" had to be construed as encompassing appeals to the FOSFA or GAFTA appeal board. Nonetheless, the Court held that time still ran from the date of the appeal award on the basis that the words "if there has been a process of arbitral appeal or review" had to be construed as meaning "if there has been a process of arbitral appeal or review from the award that is the subject of the challenge to the Court". Accordingly, for challenges to the Court in respect of FOSFA or GAFTA appeal awards, time starts running from the date of the award itself unless either party asks the relevant arbitral institution to review or appeal that award.
The Court has thus provided a welcome note of clarity on a point which is of general application to challenges before the English Courts in respect of FOSFA or GAFTA appeal awards (or any other arbitral appeal awards). As a post-script, the Court was unwilling to provide an extension of time to the Claimant for the bringing of its section 69 challenge noting that the main arbitration textbooks referred to the issue relating to section 70(3) and also to the decisions in one, other or both of UR Power and Pec Ltd, such that the Claimant should have been aware that if it brought its appeal more than 28 days after the date of the appeal award, it risked the challenge being out of time.
Chris represented the successful defendant and was instructed by Emma Skakle and Anna McDowell of Stephenson Harwood LLP.
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