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What legal requirements are there for recognition of an award? Must reasons be given for the award? Does the award need to be reviewed by any other body?
Section 52(1) of the Arbitration Act 1996 specifies that the parties are free to agree on the form of the award. If no agreement has been reached the award must:
- be in writing;
- be signed by all arbitrators (or those assenting to the award);
- contain the reasons for it (unless it is an agreed award or the parties have agreed to dispense with reasons);
- state the seat of the arbitration; and
- state the date on which it is made (Sections 52(3) to (5)).
There is no obligation for an award to be reviewed by another body before it becomes final and binding, although this may be provided for or required under institutional arbitral rules.
Timeframe for delivery
Are there any time limits on delivery of the award?
There are no time limits contained in the act regarding the delivery of the award. However, parties may agree to a time limit in their arbitration agreement. On the application of the tribunal or by any party to the proceedings (having exhausted all available arbitral processes for obtaining an extension), the court may extend the time limit if it considers that a substantial injustice would otherwise result (Section 50(3)).
Does the law impose limits on the available remedies? Are some remedies not enforceable by the court?
The parties are generally free to agree on the powers exercisable by the tribunal to grant remedies (Section 48). Unless the parties have agreed otherwise, the tribunal has the same powers as the English High Court and the county court (Section 105(1)) to order:
- a party to do or refrain from doing anything;
- specific performance of a contract (other than a contract relating to land); or
- rectification, setting aside or cancellation of a deed or other document.
For public policy reasons a tribunal does not have the power under English law to award punitive damages, nor is it likely that an English court would have the power to enforce such an award. A tribunal may also not order imprisonment or the payment of fines.
What interim measures are available? Will local courts issue interim measures pending constitution of the tribunal?
Unless otherwise agreed by the parties, the tribunal has the power to grant a number of interim measures, including security for costs and measures to preserve evidence (Section 38). The parties may have agreed that the tribunal should have different or additional powers to grant interim measures, either in their arbitration agreement or by reference to institutional arbitration rules. Interim measures may be available under institutional arbitration rules through the appointment of an emergency arbitrator before the tribunal is constituted.
The court is also able to grant interim measures in support of arbitration (Section 44) and has the same power of making orders about the matters listed in Section 44 as it has for the purposes of legal proceedings. Those matters include, but are not limited to, the taking of evidence of witnesses, the preservation of evidence and the granting of an interim injunction. While the court may still be restricted from granting an anti-suit injunction in respect of court proceedings brought in another EU member state following the Recast Brussels Regulation, the courts remain able to restrain proceedings brought in courts outside EU or European Free Trade Agreement countries in violation of an arbitration agreement, even if arbitration proceedings have not yet been commenced.
However, the court can order interim measures only where the tribunal has no power (eg, it has not yet been constituted or where the tribunal lacks the necessary power to grant that relief) or is unable to act effectively. Assuming this test is met, the court may give ex parte relief where the matter is one of urgency. In the absence of urgency, the court will require the permission of the tribunal or the written consent of the parties.
There is a question mark over the impact of emergency and expedited provisions in institutional rules on the ability of the English court to order interim measures. In Gerald Metals SA v Timis ( EWHC 2327 (Ch)), the English court held that where there is sufficient time for an applicant to obtain relief from an expedited tribunal or emergency arbitrator under the rules, the court has no power to grant urgent relief. In that case, it was held that the court did not have power to grant the freezing injunction requested by the applicant because the applicant's request for an emergency arbitrator under the applicable institutional arbitration rules (the London Court of International Arbitration Rules) had already been considered and dismissed by the London Court of International Arbitration.
Can interest be awarded?
Subject to an agreement between the parties, the tribunal may award simple or compound interest from such dates, at such rates and with such rests as it considers to meet the justice of the case (Section 49) both up to the date of the award and from the date of the award to the date of payment.
At what rate?
The rate is at the tribunal's discretion, subject to any agreement of the parties to the contrary (Section 49).
Is the award final and binding?
Unless otherwise agreed by the parties, an award is final and binding on both the parties and any persons claiming through or under them (Section 58(1)). This does not affect the right of a person to challenge the award by any available arbitral process of appeal or review, or in accordance with the act (Section 58(2)(a)).
What if there are any mistakes?
Subject to any agreement of the parties to the contrary, if there are mistakes in an award, the tribunal may, on its own initiative or on the application of a party, correct the award so as to remove any clerical mistake or error arising from an accidental slip or omission or clarify or remove any ambiguity (Section 57(3)(a)). The tribunal is also able to make an additional award in relation to any claim presented to it which was not dealt with in the original award. All the parties must be given a reasonable opportunity to make representations to the tribunal (Section 57(3)(b)). There are a number of specific time limits (subject to the parties agreeing a longer period):
- Any application for a correction must be made within 28 days of the date of an award or such longer period as the parties may agree (Section 57(4)) and any correction of an award must then be made within 28 days of the date on which the tribunal receives the application.
- Where the correction is made by the tribunal on its own initiative, the correction must be made within 28 days of the date of the award.
- Any additional award must be made within 56 days of the date of the original award (Section 57(6)).
Any correction of an award shall form part of the award (Section 57(7)).
Can the parties exclude by agreement any right of appeal or other recourse that the law of your jurisdiction may provide?
Sections 67 and 68 of the act provide respectively for challenge to an award for want of substantive jurisdiction and for procedural irregularity. These are mandatory rights which cannot be excluded. Section 69 provides for appeal on a point of English law. This right is non-mandatory and may be excluded by agreement of the parties. Many arbitral rules expressly exclude all non-mandatory rights of appeal.
What is the procedure for challenging awards?
A Section 67 or 68 challenge or an appeal under Section 69 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 (Section 70(3)). However, the applicant or appellant must first have exhausted any available arbitration process of appeal or review and any available recourse for correction of the award (Section 70(2)).
To begin a challenge, the applicant must file an arbitration claim form. Part 62 of the English Rules of Civil Procedure will apply.
On what grounds can parties appeal an award?
A party may apply to the court to challenge an award on the grounds that:
- the tribunal lacked substantive jurisdiction (Section 67); or
- there was a serious irregularity affecting the tribunal, the proceedings or the award (Section 68).
Section 68 provides an exhaustive list of irregularities and in each case the court must be satisfied that the irregularity has caused or will cause substantial injustice to the applicant.
A party may also seek to appeal an award on the grounds that the tribunal made an error on a point of English law (Section 69).
Both Sections 67 and 68 are mandatory (they cannot be excluded by party agreement), but Section 69 is non-mandatory. Many institutional arbitration rules expressly exclude all non-mandatory rights of appeal.
What steps can be taken to enforce the award if there is a failure to comply?
The party seeking to enforce the award will apply to the court to enter a judgment or order of the court on the same terms as the award (under Sections 66 or 101 of the act (for awards made in the territory of another state which is a party to the New York Convention 1958)). A party may also be able to enforce an arbitral award at common law.
Enforcement of the award can then take place using all means available to a court under English law, such as enforcement against goods or assets or third-party debt orders.
Can awards be enforced in local courts?
Yes, the English courts have a pro-enforcement stance and both domestic and foreign arbitral awards can be enforced in the English courts.
How enforceable is the award internationally?
Since the United Kingdom is a signatory to the New York Convention and the Geneva Convention, awards made in this jurisdiction are internationally enforceable in jurisdictions which are a party to those conventions. As of March 10 2017, there were 157 parties to the New York Convention. A party seeking to enforce an arbitral award under the convention will need to comply with the formal requirements set out in it, together with any additional local procedural requirements.
Arbitral awards made in the jurisdiction may also be enforceable in countries which are not signatories to these conventions where domestic law provides or allows for enforcement.
To what extent might a state or state entity successfully raise a defence of state or sovereign immunity at the enforcement stage?
By entering into an arbitration agreement (and unless the parties have agreed otherwise), under English law, a state or state entity waives immunity from the jurisdiction of the English court in respect of proceedings which relate to the arbitration (Section 9 of the State Immunity Act 1978). However, a state or state entity and its assets will be immune from enforcement of an arbitral award, unless the state or state entity has consented to such relief or the property is being used or intended to be used for commercial purposes (Sections 13(2) to (4)).
Are there any other bases on which an award may be challenged, and if so, by what?
There are no other bases on which to challenge an award other than those set out above.
However, certain grounds may be raised in defence of an application for recognition and enforcement of the award:
- A non-New York Convention award will not be enforced under Section 66 of the Arbitration Act where the tribunal lacked the substantive jurisdiction to make the award. The English court may also refuse enforcement under Section 66 on grounds similar to those which may be relied upon in defence of an application for recognition and enforcement of a New York Convention award (found in Section 103).
- Section 103 contains an exhaustive list of the grounds for refusing recognition or enforcement of a New York Convention award, replicating the language of the New York Convention.
- Section 37 of the Arbitration Act 1950 sets out the grounds on which recognition and enforcement of a Geneva Convention award can be refused.
- An award being enforced at common law may not be enforced where the validity of the award is in doubt.
How enforceable are foreign arbitral awards in your jurisdiction?
The English courts have a pro-enforcement stance and will refuse to enforce arbitral awards only rarely. As a signatory to the New York Convention, the courts recognise foreign arbitration awards made in the territory of a state that is a party to the New York Convention in accordance with Section 101 of the act, but awards made in the territory of non-signatory states may also be enforced.
Will an award that has been set aside by the courts in the seat of arbitration be enforced in your jurisdiction?
The English courts have the discretion to enforce an award that has been set aside or suspended by the courts in the seat of arbitration (Section 103(2)(f); see also Yukos Capital SARL v OJSC Rosneft Oil Company ( EWHC 2188 (Comm))). The English courts will question a foreign court’s decision on its own law and/or to undermine a foreign court’s judgment for bias or unfairness where there is compelling evidence (Malicorp Ltd v Government of the Arab Republic of Egypt ( EWHC 361 (Comm))).
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