Challenging an arbitration award is designed to be difficult. The definitive nature of arbitration means courts rarely reconsider a case based on a party’s assertion that the tribunal’s decision was incorrect. That said, most legal systems provide limited routes to challenge an award where there is a serious procedural failing, lack of authority, or conflict with fundamental legal principles, and UK courts are no different.
Before challenging an award, you must determine the arbitration’s legal home (seat), the applicable rules, and if the award is domestic or international. The law of the seat determines what court can hear a challenge and on what grounds; for example, in England and Wales, challenges are governed by the Arbitration Act 1996.
Courts generally permit challenges to an arbitration award only on narrow, clearly defined grounds. The most common categories are:
- Lack of jurisdiction and authority
- Serious procedural irregularities
- Public policy and illegality
- Errors of law
Section 69 of the Arbitration Act gives a party the right to appeal an award on a point of law. This must be made within 28 days of the date of award.
An applicant must file their challenge claim or application in the supervisory court of the seat that decided the award. It must be supported by evidence showing the relevant ground and why it materially impacted the outcome. Courts possess the authority to rapidly dismiss baseless challenges and can assign the cost of litigation to the unsuccessful claimant.
If the other side attempts to enforce the award in a different country, the losing party may oppose enforcement under the New York Convention for international awards. The 1958
New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards is the cornerstone of international arbitration, binding 172 parties to recognise and enforce foreign arbitral awards in the same manner as domestic ones. It requires courts to refer disputes to arbitration if a valid agreement exists and limits refusal grounds to specific, narrow conditions such as incapacity, invalid agreement, lack of notice, and excess of scope or public policy.
A viable challenge hinges on clear recorded defects, jurisdictional issues, serious unfairness, or public policy matters. To consider a challenge, you must act immediately, gather the arbitration record and obtain specialist advice as soon as possible, as delay and weak grounds can be costly.
Nath Solicitors are a boutique law firm with over 30 years’ legal experience. We focus on delivering expert advice on arbitration matters. If you need assistance, please call us on 0203 983 8278 or email us at enquiries@nathsolicitors.co.uk.