LEGAL
COMMENT
I am reviving this column with thanks to Derek Jerram for his sterling
work over the years and am starting with this preamble to set out my
intentions. This is not going to be anything resembling abstracts of
cases or law reports, you can find these much quicker elsewhere. My intention
is to comment on principles, with reference to fairly recent cases, with
suggestions as to their true meaning and effect. To this end, I must stress that
all views are mine personally and do not purport to have the support or
agreement of The Chartered Institute, the S E Branch or the Editors of News
& Views.
There have recently been two cases of note which found perceived bias,
both in enforcement of adjudication decisions, but the principles also apply to
arbitration and challenges to an award on the ground of serious irregularity.
In the full trial of Discain Project Services
Limited -v- Opecprim Developments Limited HH Judge Peter Bowsher set out
some very restrictive parameters which should be followed by an adjudicator
(and, I submit, an arbitrator) when making contact with one party in the
absence of the other. Effectively, he
appears to want to restrict such contact to purely administrative functions,
preferably carried out by a secretary. It is now established (and I say it
always was) that an adjudicator cannot ignore natural justice (see below),
making the duty of adjudicator and arbitrator on a par. This means that you
cannot take evidence from one party without keeping the other fully
informed. Bowsher stresses the
difficulty of complying with such a duty within a restricted timescale, making
it virtually impossible. Whilst arbitration is not so restricted in time, the
same parameters must apply to comply with the duty to avoid unnecessary delay
and expense.
I respectfully suggest that this is a step too far. Both schemes provide
for investigation by the tribunal, and the intention of Parliament must be
paramount. This avenue must remain open to the adjudicator / arbitrator, and it
is the skill and judgement of the tribunal which should remove all perception
of bias.
In Glencot Development & Design Co Limited
-v- Ben Barratt & Son (Contractors) Limited, the adjudicator, on
suggestion of the parties, attempted to assist with settlement by acting as a
mediator. When the mediation failed, the parties asked the adjudicator to
continue with the adjudication. He recognised that there was a possible
perception of bias and gave the parties the opportunity to object, when he
would resign. In the event, the Respondent did not object within the time given
by the adjudicator but waited until a later stage (when the outcome was more
obvious). Judge Humphrey Lloyd found that there was perceived bias because the
adjudicator had continued with the adjudication after the failed mediation and
may have become aware of "without prejudice" matters during the
mediation. When I first read the judgement, I thought that the proper result
should have been the equivalent of s.73 of the Arbitration Act loss of the right to challenge following
delay. Subsequently, I think that this
section cannot be imported unless expressly provided. However, unlike other
commentators, I suggest that this judgement does not meant that an
adjudicator or arbitrator can never act as mediator, if requested by the
parties, and then revert to the original format. I suggest that the
"mediation" should be treated as though it was a meeting with each
party separately and dealt with by full disclosure of all relevant matters to
the other party (by agreement with the first party). If the parties do not
agree to this procedure or to full disclosure then the adjudicator / arbitrator
should resign.
We keep hearing (and seeing in judgements) the expression "rules of
natural justice", leading to the query of precisely what these rules are.
It would be more correct for the honourable judges to refer to an action being
"in breach of natural justice". There is no defined list of rules
(such as Moses brought down on tablets of stone), rather a series of principles
to which the facts of the case are related, based on perceived fairness in the
proceedings. Basically, you cannot have an interest in the subject-matter of
the dispute before you; each party must be given reasonable opportunity to put
its case, to know the case against it, and to respond to it; and all parties
must be given reasonable opportunity to comment on all evidence on which the
tribunal may rely.
Peter Horne