19 March 2003

The Reigate Manor Hotel saw one of our best-attended meetings on Wednesday 19 March. It was a red letter day for the Branch. We celebrated the 20th anniversary of the founding of the Branch with a complimentary glass of wine; and as the climax to the evening we welcomed Tony Bingham back as our guest speaker. It says a lot for Tony’s confidence as a speaker that he did not decide on the subject of his talk till a few hours before the meeting; and it says a lot for his reputation and popularity that the advertised title of his talk – ‘tba’ – still attracted a record turn-out.

Tony spent the first few minutes telling us what he had decided not to talk about. His first idea, he said, had been to reflect on the 1996 Arbitration Act – the hopes with which it had been greeted when it came into force early in 1997, and the reality of experience six years later. His own view of the Act had been extremely positive: it would completely change the handling of arbitrations; the adversarial system of the past would be replaced by an inquisitorial approach, in which the arbitrator would take a much more active and purposive role. Arbitration would be-come less ‘litigation in suits’, and more of an investigation, with an expert arbitrator taking the initiative and calling on legal advice where needed. Adjudication too under the Construction Act of the same year had been designed as a procedure where expert adjudicators would take an inquisitorial approach to investigate disputes proactively.

But in the event adjudicators had been terrorised by the risk of legal challenge. Nor had arbitrators changed. Neither had developed an inquisitorial approach. Both were still hamstrung by the adversarial system.

That was what Tony had decided not to talk about. But it led him on to ask: ‘What might be the reasons for this cautious?’ He invited our views: ‘What might cause arbitrators (or adjudicators) to make decisions in the course of their professional activity with their own skin in mind?’

We offered a number of suggestions: concern at publicity generated by previous cases; fear of criticism and adverse publicity for ourselves; fear of being made to look a fool; fear for reputation; lack of confidence discouraging strong decisions; fear of losing work; fear of disciplinary proceedings.

Tony agreed. The ultimate risk for an arbitrator was to find oneself taken to court by one of the parties for removal under s24 of the 1996 Act and being the subject of disciplinary proceedings thereafter. He mentioned several recent court cases. In one instance the Hon Mr Justice Forbes had taken a robust line, commenting that, in choosing arbitration in preference to litigation, the parties must be assumed to have accepted the risks attendant on not using the courts. In another case, however, a judge had not only granted an application to remove an arbitrator, but had also docked half his fees and, in response to the arbitrator’s having come in person to assist the court, had awarded the costs of the application against him – this despite the statutory immunity granted by s29 of the Act. Perhaps the arbitrator had conducted himself foolishly, but he had not acted in bad faith. (This showed, Tony remarked by the way, the advisability of arbitrators taking out professional indemnity insurance.)

Arbitration was the making of decisions about the civil rights of parties. It was essential that anyone appointed to a tribunal for this purpose must enjoy total independence: an arbitrator must be safeguarded from bullying, from intimidation, from compromise; arbitrators, as much as judges, should feel under no pressure to ingratiate themselves with the parties. This was not for the arbitrator’s sake, but for the sake of the parties themselves. Article 6.1 of the Human Rights Convention provided that everyone was entitled to a hearing by a tribunal that was independent as well as impartial. To ensure independence tribunals must enjoy full immunity: arbitrators should be in the same position as judges in this respect. The statutory immunity of arbitrators (and adjudicators) was a treasure, and anything that impaired their independence, by undermining that immunity, was wrong.

Tony quoted a number of instances where the courts had set aside decisions of courts martial, employment tribunals, temporary sheriffs, and even of judges in overseas jurisdictions, on the grounds that they were not sufficiently independent. It was clear that arbitrators must be subject to no outside influence or interference. If anything caused them to take decisions with their own skin in mind, then those decisions were void.

This had implications even for the profession’s disciplinary procedures: if these undermined an arbitrator’s independence, they were wrong. Arbitrators were in a different position here from other professionals. It was the essence of an arbitrator’s function to make enforceable decisions on the rights of others, and arbitrators could not properly do this if they were subject to intimidation by the parties on the basis that they might lose their reputation and livelihood.

Tony gave his view that for these reasons the Chartered Institute’s disciplinary procedures must be ended. Certainly arbitrators did sometimes go wrong, but the remedy should, as with judges, be something less formal and public – a word in the ear, or a request to resign. The same logic led him to question the continuance of s24 of the 1996 Act on the court’s power to remove an arbitrator. Experience had shown that s24 had sometimes been used to target arbitrators in order to influence their decisions. This was unacceptable. Arbitrators must be able to make their decisions without having their skin in mind.

Tony ended by saying that he wanted arbitrators to be able to make the decision they wanted to make; he wanted them to be truly independent. He was willing to offer pastoral care and help to any arbitrator who felt that their own independence was under threat from intimidation by the parties.

The meeting’s interest in Tony Bingham’s talk was demonstrated by the many comments and questions that were put without prompting. Several people confirmed Tony’s thesis that the independence of arbitrators and adjudicators was being threatened by the adversariality and litigiousness of parties or their representatives. ‘The courts had kicked adjudication to death.’ One member gave an instance of a case in which he had take a bold line with the parties that he was convinced was right. The respondent, who was an individual, had complained to the Chartered Institute, who had taken six months over the case before exonerating him; in the meantime he had received no further panel appointments. He now refused further cases where one of the parties was an individual.

Another member asked whether, if we dispensed with a disciplinary procedure, we should not instead tighten up quality control, as another way of providing due public accountability for the profession. Tony agreed. His proposal was that each arbitrator and adjudicator should be required to hold a practising certificate to be renewed annually. To qualify for renewal arbitrators and adjudicators would have to submit a 2,000-word essay demonstrating that they were keeping abreast of developing case law.

After more discussion, members adjourned for an excellent meal and celebratory drink, but not before our chairman Derek Ross had thanked Tony Bingham warmly for his talk: we had come to associate Tony with two phrases in particular: ‘thought-provoking’ and ‘generous with time’?, and these had been well demonstrated this evening.

reported by Roger Clarke