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PART I continued
Unless the parties otherwise agree, any obligation under an agreement between them as to how the costs of the arbitration are to be borne, or under an award allocating the costs of the arbitration, extends only to such costs as are recoverable.
(1) The parties are free to agree what costs of the arbitration are recoverable.
(2) If or to the extent there is no such agreement, the following provisions apply.
(3) The tribunal may determine by award the recoverable costs of the arbitration on such basis as it thinks fit.
If it does so, it shall specify—
(a) the basis on which it has acted, and
(b) the items of recoverable costs and the amount referable to each.
(4) If the tribunal does not determine the recoverable costs of the arbitration, any party to the arbitral proceedings may apply to the court (upon notice to the other parties) which may—
(a) determine the recoverable costs of the arbitration on such basis as it thinks fit, or
(b) order that they shall be determined by such means and upon such terms as it may specify.
(5) Unless the tribunal or the court determines otherwise—
(a) the recoverable costs of the arbitration shall be determined on the basis that there shall be allowed a reasonable amount in respect of all costs reasonably incurred, and
(b) any doubt as to whether costs were reasonably incurred or were reasonable in amount shall be resolved in favour of the paying party.
(6) The above provisions have effect subject to section 64 (recoverable fees and expenses of arbitrators).
(7) Nothing in this section affects any right of the arbitrators, any expert, legal adviser or assessor appointed by the tribunal, or any arbitral institution, to payment of their fees and expenses.
(1) Unless otherwise agreed by the parties, the recoverable costs of the arbitration shall include in respect of the fees and expenses of the arbitrators only such reasonable fees and expenses as are appropriate in the circumstances.
(2) If there is any question as to what reasonable fees and expenses are appropriate in the circumstances, and the matter is not already before the court on an application under section 63(4), the court may on the application of any party (upon notice to the other parties)—
(a) determine the matter, or
(b) order that it be determined by such means and upon such terms as the court may specify.
(3) Subsection (1) has effect subject to any order of the court under section 24(4) or 25(3)(b) (order as to entitlement to fees or expenses in case of removal or resignation of arbitrator).
(4) Nothing in this section affects any right of the arbitrator to payment of his fees and expenses.
(1) Unless otherwise agreed by the parties, the tribunal may direct that the recoverable costs of the arbitration, or of any part of the arbitral proceedings, shall be limited to a specified amount.
(2) Any direction may be made or varied at any stage, but this must be done sufficiently in advance of the incurring of costs to which it relates, or the taking of any steps in the proceedings which may be affected by it, for the limit to be taken into account.
(1) An award made by the tribunal pursuant to an arbitration agreement may, by leave of the court, be enforced in the same manner as a judgment or order of the court to the same effect.
(2) Where leave is so given, judgment may be entered in terms of the award.
(3) Leave to enforce an award shall not be given where, or to the extent that, the person against whom it is sought to be enforced shows that the tribunal lacked substantive jurisdiction to make the award.
The right to raise such an objection may have been lost (see section 73).
(4) Nothing in this section affects the recognition or enforcement of an award under any other enactment or rule of law, in particular under Part II of the [1950 c. 27.] Arbitration Act 1950 (enforcement of awards under Geneva Convention) or the provisions of Part III of this Act relating to the recognition and enforcement of awards under the New York Convention or by an action on the award.
(1) A party to arbitral proceedings may (upon notice to the other parties and to the tribunal) apply to the court—
(a) challenging any award of the arbitral tribunal as to its substantive jurisdiction; or
(b) for an order declaring an award made by the tribunal on the merits to be of no effect, in whole or in part, because the tribunal did not have substantive jurisdiction.
A party may lose the right to object (see section 73) and the right to apply is subject to the restrictions in section 70(2) and (3).
(2) The arbitral tribunal may continue the arbitral proceedings and make a further award while an application to the court under this section is pending in relation to an award as to jurisdiction.
(3) On an application under this section challenging an award of the arbitral tribunal as to its substantive jurisdiction, the court may by order—
(a) confirm the award,
(b) vary the award, or
(c) set aside the award in whole or in part.
(4) The leave of the court is required for any appeal from a decision of the court under this section.
(1) A party to arbitral proceedings may (upon notice to the other parties and to the tribunal) apply to the court challenging an award in the proceedings on the ground of serious irregularity affecting the tribunal, the proceedings or the award.
A party may lose the right to object (see section 73) and the right to apply is subject to the restrictions in section 70(2) and (3).
(2) Serious irregularity means an irregularity of one or more of the following kinds which the court considers has caused or will cause substantial injustice to the applicant—
(a) failure by the tribunal to comply with section 33 (general duty of tribunal);
(b) the tribunal exceeding its powers (otherwise than by exceeding its substantive jurisdiction: see section 67);
(c) failure by the tribunal to conduct the proceedings in accordance with the procedure agreed by the parties;
(d) failure by the tribunal to deal with all the issues that were put to it;
(e) any arbitral or other institution or person vested by the parties with powers in relation to the proceedings or the award exceeding its powers;
(f) uncertainty or ambiguity as to the effect of the award;
(g) the award being obtained by fraud or the award or the way in which it was procured being contrary to public policy;
(h) failure to comply with the requirements as to the form of the award; or
(i) any irregularity in the conduct of the proceedings or in the award which is admitted by the tribunal or by any arbitral or other institution or person vested by the parties with powers in relation to the proceedings or the award.
(3) If there is shown to be serious irregularity affecting the tribunal, the proceedings or the award, the court may—
(a) remit the award to the tribunal, in whole or in part, for reconsideration,
(b) set the award aside in whole or in part, or
(c) declare the award to be of no effect, in whole or in part.
The court shall not exercise its power to set aside or to declare an award to be of no effect, in whole or in part, unless it is satisfied that it would be inappropriate to remit the matters in question to the tribunal for reconsideration.
(4) The leave of the court is required for any appeal from a decision of the court under this section.
(1) Unless otherwise agreed by the parties, a party to arbitral proceedings may (upon notice to the other parties and to the tribunal) appeal to the court on a question of law arising out of an award made in the proceedings.
An agreement to dispense with reasons for the tribunal’s award shall be considered an agreement to exclude the court’s jurisdiction under this section.
(2) An appeal shall not be brought under this section except—
(a) with the agreement of all the other parties to the proceedings, or
(b) with the leave of the court.
The right to appeal is also subject to the restrictions in section 70(2) and (3).
(3) Leave to appeal shall be given only if the court is satisfied—
(a) that the determination of the question will substantially affect the rights of one or more of the parties,
(b) that the question is one which the tribunal was asked to determine,
(c) that, on the basis of the findings of fact in the award—
(i) the decision of the tribunal on the question is obviously wrong, or
(ii) the question is one of general public importance and the decision of the tribunal is at least open to serious doubt, and
(d) that, despite the agreement of the parties to resolve the matter by arbitration, it is just and proper in all the circumstances for the court to determine the question.
(4) An application for leave to appeal under this section shall identify the question of law to be determined and state the grounds on which it is alleged that leave to appeal should be granted.
(5) The court shall determine an application for leave to appeal under this section without a hearing unless it appears to the court that a hearing is required.
(6) The leave of the court is required for any appeal from a decision of the court under this section to grant or refuse leave to appeal.
(7) On an appeal under this section the court may by order—
(a) confirm the award,
(b) vary the award,
(c) remit the award to the tribunal, in whole or in part, for reconsideration in the light of the court’s determination, or
(d) set aside the award in whole or in part.
The court shall not exercise its power to set aside an award, in whole or in part, unless it is satisfied that it would be inappropriate to remit the matters in question to the tribunal for reconsideration.
(8) The decision of the court on an appeal under this section shall be treated as a judgment of the court for the purposes of a further appeal.
But no such appeal lies without the leave of the court which shall not be given unless the court considers that the question is one of general importance or is one which for some other special reason should be considered by the Court of Appeal.
(1) The following provisions apply to an application or appeal under section 67, 68 or 69.
(2) An application or appeal may not be brought if the applicant or appellant has not first exhausted—
(a) any available arbitral process of appeal or review, and
(b) any available recourse under section 57 (correction of award or additional award).
(3) 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.
(4) If on an application or appeal it appears to the court that the award—
(a) does not contain the tribunal’s reasons, or
(b) does not set out the tribunal’s reasons in sufficient detail to enable the court properly to consider the application or appeal,
the court may order the tribunal to state the reasons for its award in sufficient detail for that purpose.
(5) Where the court makes an order under subsection (4), it may make such further order as it thinks fit with respect to any additional costs of the arbitration resulting from its order.
(6) The court may order the applicant or appellant to provide security for the costs of the application or appeal, and may direct that the application or appeal be dismissed if the order is not complied with.
The power to order security for costs shall not be exercised on the ground that the applicant or appellant is—
(a) an individual ordinarily resident outside the United Kingdom, or
(b) a corporation or association incorporated or formed under the law of a country outside the United Kingdom, or whose central management and control is exercised outside the United Kingdom.
(7) The court may order that any money payable under the award shall be brought into court or otherwise secured pending the determination of the application or appeal, and may direct that the application or appeal be dismissed if the order is not complied with.
(8) The court may grant leave to appeal subject to conditions to the same or similar effect as an order under subsection (6) or (7).
This does not affect the general discretion of the court to grant leave subject to conditions.
(1) The following provisions have effect where the court makes an order under section 67, 68 or 69 with respect to an award.
(2) Where the award is varied, the variation has effect as part of the tribunal’s award.
(3) Where the award is remitted to the tribunal, in whole or in part, for reconsideration, the tribunal shall make a fresh award in respect of the matters remitted within three months of the date of the order for remission or such longer or shorter period as the court may direct.
(4) Where the award is set aside or declared to be of no effect, in whole or in part, the court may also order that any provision that an award is a condition precedent to the bringing of legal proceedings in respect of a matter to which the arbitration agreement applies, is of no effect as regards the subject matter of the award or, as the case may be, the relevant part of the award.
(1) A person alleged to be a party to arbitral proceedings but who takes no part in the proceedings may question—
(a) whether there is a valid arbitration agreement,
(b) whether the tribunal is properly constituted, or
(c) what matters have been submitted to arbitration in accordance with the arbitration agreement,
by proceedings in the court for a declaration or injunction or other appropriate relief.
(2) He also has the same right as a party to the arbitral proceedings to challenge an award—
(a) by an application under section 67 on the ground of lack of substantive jurisdiction in relation to him, or
(b) by an application under section 68 on the ground of serious irregularity (within the meaning of that section) affecting him;
and section 70(2) (duty to exhaust arbitral procedures) does not apply in his case.
(1) If a party to arbitral proceedings takes part, or continues to take part, in the proceedings without making, either forthwith or within such time as is allowed by the arbitration agreement or the tribunal or by any provision of this Part, any objection—
(a) that the tribunal lacks substantive jurisdiction,
(b) that the proceedings have been improperly conducted,
(c) that there has been a failure to comply with the arbitration agreement or with any provision of this Part, or
(d) that there has been any other irregularity affecting the tribunal or the proceedings,
he may not raise that objection later, before the tribunal or the court, unless he shows that, at the time he took part or continued to take part in the proceedings, he did not know and could not with reasonable diligence have discovered the grounds for the objection.
(2) Where the arbitral tribunal rules that it has substantive jurisdiction and a party to arbitral proceedings who could have questioned that ruling—
(a) by any available arbitral process of appeal or review, or
(b) by challenging the award,
does not do so, or does not do so within the time allowed by the arbitration agreement or any provision of this Part, he may not object later to the tribunal’s substantive jurisdiction on any ground which was the subject of that ruling.
(1) An arbitral or other institution or person designated or requested by the parties to appoint or nominate an arbitrator is not liable for anything done or omitted in the discharge or purported discharge of that function unless the act or omission is shown to have been in bad faith.
(2) An arbitral or other institution or person by whom an arbitrator is appointed or nominated is not liable, by reason of having appointed or nominated him, for anything done or omitted by the arbitrator (or his employees or agents) in the discharge or purported discharge of his functions as arbitrator.
(3) The above provisions apply to an employee or agent of an arbitral or other institution or person as they apply to the institution or person himself.
The powers of the court to make declarations and orders under section 73 of the [1974 c. 47.] Solicitors Act 1974 or Article 71H of the [S.I. 1976/582 (N.I. 12).] Solicitors (Northern Ireland) Order 1976 (power to charge property recovered in the proceedings with the payment of solicitors' costs) may be exercised in relation to arbitral proceedings as if those proceedings were proceedings in the court.
(1) The parties are free to agree on the manner of service of any notice or other document required or authorised to be given or served in pursuance of the arbitration agreement or for the purposes of the arbitral proceedings.
(2) If or to the extent that there is no such agreement the following provisions apply.
(3) A notice or other document may be served on a person by any effective means.
(4) If a notice or other document is addressed, pre-paid and delivered by post—
(a) to the addressee’s last known principal residence or, if he is or has been carrying on a trade, profession or business, his last known principal business address, or
(b) where the addressee is a body corporate, to the body’s registered or principal office,
it shall be treated as effectively served.
(5) This section does not apply to the service of documents for the purposes of legal proceedings, for which provision is made by rules of court.
(6) References in this Part to a notice or other document include any form of communication in writing and references to giving or serving a notice or other document shall be construed accordingly.
(1) This section applies where service of a document on a person in the manner agreed by the parties, or in accordance with provisions of section 76 having effect in default of agreement, is not reasonably practicable.
(2) Unless otherwise agreed by the parties, the court may make such order as it thinks fit—
(a) for service in such manner as the court may direct, or
(b) dispensing with service of the document.
(3) Any party to the arbitration agreement may apply for an order, but only after exhausting any available arbitral process for resolving the matter.
(4) The leave of the court is required for any appeal from a decision of the court under this section.
(1) The parties are free to agree on the method of reckoning periods of time for the purposes of any provision agreed by them or any provision of this Part having effect in default of such agreement.
(2) If or to the extent there is no such agreement, periods of time shall be reckoned in accordance with the following provisions.
(3) Where the act is required to be done within a specified period after or from a specified date, the period begins immediately after that date.
(4) Where the act is required to be done a specified number of clear days after a specified date, at least that number of days must intervene between the day on which the act is done and that date.
(5) Where the period is a period of seven days or less which would include a Saturday, Sunday or a public holiday in the place where anything which has to be done within the period falls to be done, that day shall be excluded.
In relation to England and Wales or Northern Ireland, a “public holiday” means Christmas Day, Good Friday or a day which under the [1971 c. 80.] Banking and Financial Dealings Act 1971 is a bank holiday.
(1) Unless the parties otherwise agree, the court may by order extend any time limit agreed by them in relation to any matter relating to the arbitral proceedings or specified in any provision of this Part having effect in default of such agreement.
This section does not apply to a time limit to which section 12 applies (power of court to extend time for beginning arbitral proceedings, &c.).
(2) An application for an order may be made—
(a) by any party to the arbitral proceedings (upon notice to the other parties and to the tribunal), or
(b) by the arbitral tribunal (upon notice to the parties).
(3) The court shall not exercise its power to extend a time limit unless it is satisfied—
(a) that any available recourse to the tribunal, or to any arbitral or other institution or person vested by the parties with power in that regard, has first been exhausted, and
(b) that a substantial injustice would otherwise be done.
(4) The court’s power under this section may be exercised whether or not the time has already expired.
(5) An order under this section may be made on such terms as the court thinks fit.
(6) The leave of the court is required for any appeal from a decision of the court under this section.
(1) References in this Part to an application, appeal or other step in relation to legal proceedings being taken “upon notice” to the other parties to the arbitral proceedings, or to the tribunal, are to such notice of the originating process as is required by rules of court and do not impose any separate requirement.
(2) Rules of court shall be made—
(a) requiring such notice to be given as indicated by any provision of this Part, and
(b) as to the manner, form and content of any such notice.
(3) Subject to any provision made by rules of court, a requirement to give notice to the tribunal of legal proceedings shall be construed—
(a) if there is more than one arbitrator, as a requirement to give notice to each of them; and
(b) if the tribunal is not fully constituted, as a requirement to give notice to any arbitrator who has been appointed.
(4) References in this Part to making an application or appeal to the court within a specified period are to the issue within that period of the appropriate originating process in accordance with rules of court.
(5) Where any provision of this Part requires an application or appeal to be made to the court within a specified time, the rules of court relating to the reckoning of periods, the extending or abridging of periods, and the consequences of not taking a step within the period prescribed by the rules, apply in relation to that requirement.
(6) Provision may be made by rules of court amending the provisions of this Part—
(a) with respect to the time within which any application or appeal to the court must be made,
(b) so as to keep any provision made by this Part in relation to arbitral proceedings in step with the corresponding provision of rules of court applying in relation to proceedings in the court, or
(c) so as to keep any provision made by this Part in relation to legal proceedings in step with the corresponding provision of rules of court applying generally in relation to proceedings in the court.
(7) Nothing in this section affects the generality of the power to make rules of court.
(1) Nothing in this Part shall be construed as excluding the operation of any rule of law consistent with the provisions of this Part, in particular, any rule of law as to—
(a) matters which are not capable of settlement by arbitration;
(b) the effect of an oral arbitration agreement; or
(c) the refusal of recognition or enforcement of an arbitral award on grounds of public policy.
(2) Nothing in this Act shall be construed as reviving any jurisdiction of the court to set aside or remit an award on the ground of errors of fact or law on the face of the award.
(1) In this Part—
“arbitrator”, unless the context otherwise requires, includes an umpire;
“available arbitral process”, in relation to any matter, includes any process of appeal to or review by an arbitral or other institution or person vested by the parties with powers in relation to that matter;
“claimant”, unless the context otherwise requires, includes a counterclaimant, and related expressions shall be construed accordingly;
“dispute” includes any difference;
“enactment” includes an enactment contained in Northern Ireland legislation;
“legal proceedings” means civil proceedings in the High Court or a county court;
“peremptory order” means an order made under section 41(5) or made in exercise of any corresponding power conferred by the parties;
“premises” includes land, buildings, moveable structures, vehicles, vessels, aircraft and hovercraft;
“question of law” means—
for a court in England and Wales, a question of the law of England and Wales, and
for a court in Northern Ireland, a question of the law of Northern Ireland;
“substantive jurisdiction”, in relation to an arbitral tribunal, refers to the matters specified in section 30(1)(a) to (c), and references to the tribunal exceeding its substantive jurisdiction shall be construed accordingly.
(2) References in this Part to a party to an arbitration agreement include any person claiming under or through a party to the agreement.
In this Part the expressions listed below are defined or otherwise explained by the provisions indicated—
| agreement, agree and agreed | section 5(1) |
| agreement in writing | section 5(2) to (5) |
| arbitration agreement | sections 6 and 5(1) |
| arbitrator | section 82(1) |
| available arbitral process | section 82(1) |
| claimant | section 82(1) |
| commencement (in relation to arbitral proceedings) | section 14 |
| costs of the arbitration | section 59 |
| the court | section 105 |
| dispute | section 82(1) |
| enactment | section 82(1) |
| legal proceedings | section 82(1) |
| Limitation Acts | section 13(4) |
| notice (or other document) | section 76(6) |
| party— | |
| —in relation to an arbitration agreement | section 82(2) |
| —where section 106(2) or (3) applies | section 106(4) |
| peremptory order | section 82(1) (and see section 41(5)) |
| premises | section 82(1) |
| question of law | section 82(1) |
| recoverable costs | sections 63 and 64 |
| seat of the arbitration | section 3 |
| serve and service (of notice or other document) | section 76(6) |
| substantive jurisdiction (in relation to an arbitral tribunal) | section 82(1) (and see section 30(1)(a) to (c)) |
| upon notice (to the parties or the tribunal) | section 80 |
| written and in writing | section 5(6) |
(1) The provisions of this Part do not apply to arbitral proceedings commenced before the date on which this Part comes into force.
(2) They apply to arbitral proceedings commenced on or after that date under an arbitration agreement whenever made.
(3) The above provisions have effect subject to any transitional provision made by an order under section 109(2) (power to include transitional provisions in commencement order).
Arbitration Act 1996