APPARENT BIAS OF ARBITRATORS
When should an arbitrator be removed pursuant to section 24 of the Arbitration Act 1996 as a result of overlapping appointments? In particular, should an inference of apparent bias be drawn in cases where arbitrators fail to disclose multiple appointments? Is the ruling in Halliburton v Chubb (2018) inconsistent with earlier cases, such as Beumer Group UK Ltd v Vinci Construction UK Ltd (2016), and do these kinds of cases show that the profession should be regulated?
Section 24 of the Arbitration Act 1996 (AA 1996) provides that the court has power to remove an arbitrator on selected grounds. These grounds include circumstances that “give rise to justifiable doubts as to his impartiality...” This test is not dissimilar to the common law test for apparent bias – R v Gough (1993) – being whether a fair-minded and informed observer, having considered the facts, would conclude that there was a real possibility that the arbitrator was biased.
Issues relating to the potential bias of arbitrators have manifested in the context of arbitrators accepting multiple appointments from one common party without the knowledge or consent of the other party. Although a situation can occur in court proceedings where a judge is involved in cases with a common party or which raise overlapping issues, the fact that arbitration is confidential and arbitrators rely on parties to appoint them creates a more nuanced problem in arbitral proceedings. Apparent bias could arise, for example, from the fact that an arbitrator might be seeking multiple appointments from one party or from asymmetry of information between the parties – one party being aware of certain evidence or how an arbitrator has previously decided similar issues, and being afforded a tactical advantage as a result.
Jul-Sep 2019 issue
Weil, Gotshal & Manges (London) LLP