In National Investment Bank Ltd v Eland International (Thailand) Co. Ltd and another [2022] EWHC 1168 (Comm), the English High Court considered the interaction between sections 72(1) and 18 of the English Arbitration Act 1996 (the “Act“). Section 72(1) allows a non-participating party to an arbitration to seek a declaration from the English Court as to the lack of jurisdiction of the tribunal, and section 18 of the Act gives the Court the power to appoint a tribunal where there is a failure of the appointment procedure between the parties.

The claimant, which was a non-participating party in an arbitration, sought a declaration from the High Court under section 72(1) that the sole arbitrator did not have jurisdiction. In response, the defendants argued that the effect of the Court having appointed the sole arbitrator pursuant to section 18 was to render the claimant a party to the arbitral proceedings and thus to preclude the claimant from relying on section 72.

The Honourable Mr Justice Foxton rejected this argument, finding that the section 72 application remained available notwithstanding the section 18 appointment and upheld the merits of the application. This decision will give comfort to non-participating parties to arbitration proceedings that the important protection for non-participants to an arbitration under section 72 remains firmly intact.


This case arose from the commencement of conflicting court and arbitration proceedings in respect of the same matter. The claimant, NIB, entered into a series of agreements with the defendants, Eland Thailand and Eland Ghana (together, “Eland“) which provided that disputes “may be referred to an Arbitrator under the Laws of the United Kingdom in London”.

Eland Thailand commenced proceedings against NIB under these agreements before the courts in Accra, Ghana (the “Accra Proceedings“). Both NIB and Eland formally participated in the preliminary stages of the Accra Proceedings, with NIB seeking to join Eland Ghana as a party to its counterclaim.

However, Eland Ghana then applied to stay the Accra Proceedings in order to commence arbitration. The application was granted and Eland served a Notice of Arbitration on NIB. When NIB did not engage with the arbitration, Eland applied to the English High Court to appoint an arbitrator under section 18, with Mr Justice Baker ordering the appointment of a sole arbitrator.

In parallel, NIB successfully applied to set aside the stay of proceedings in the Accra Proceedings. NIB then applied to the High Court under section 72(1) for a declaration that the arbitrator who had been appointed in the arbitration did not have jurisdiction to decide the claims which were the subject of the Accra Proceedings.


In its application, NIB argued that by electing to pursue the claims through the Accra Proceedings, Eland had irrevocably waived its right to pursue the same claims in arbitration. Eland argued that no such waiver had taken place, but that in any event the Court’s appointment of the arbitrator pursuant to section 18 prevented NIB’s reliance on section 72.

The effect of the Court’s appointment under section 18

Section 18(4) of the Act provides that “[a]n appointment made by the court under this section has effect as if made with the agreement of the parties“. Eland argued that the appointment of an arbitrator by the Court under section 18 therefore meant that the non-participating party could be treated as having participated in the appointment process, thereby becoming a party to the arbitral proceedings. As section 72(1) limits the availability of section 72 to a person “who takes no part in the proceedings“, NIB would not be able to rely on section 72 – either because the effect of section 18(4) and the Court’s appointment means that NIB was a party to the proceedings or was deemed to have participated in the appointment process.

Foxton J was unable to accept this argument. He first confirmed that in order to exercise its powers under section 18, it is not necessary for the Court to reach a final decision on whether there is an arbitration agreement between the parties, or whether the dispute in question falls within the scope of that arbitration agreement. It is sufficient that the applicant can show a good arguable case to that effect. Consequently, it is possible to satisfy the pre-conditions for an appointment by the Court under section 18, yet for there to be either no valid arbitration agreement or for the matter in question not to fall within the scope of the arbitration agreement for the purposes of sections 72(1)(a) and (c).

Citing the Department Advisory Committee on Arbitration Law (“DAC“) Report on the Arbitration Bill (February 1996), Foxton J emphasised the important protection provided by section 72 to those who dispute the arbitral tribunal’s jurisdiction and take no part in the arbitral process. On Eland’s construction, that “vital” protection would be lost. There is nothing in the DAC Reports of February 1996 or January 1997 to suggest that section 18(4) was intended to preclude reliance on section 72.

Moreover, the erosion of the section 72 protection would operate in a “haphazard way”. For instance, reliance on section 72 would not be precluded where a contractually-designated body (rather than the court) appointed an arbitrator, or where a sole arbitrator is appointed by the participating party under section 17. Furthermore, section 17(2) is intended to address the same issue as section 18(4), namely, non-participation in the appointment process. However, section 17(2) uses different language which is not susceptible to the same purported preclusion of section 72 (“whose award shall be binding on both parties as if he had been so appointed by agreement”). Eland’s argument would therefore involve a “stark and unexplained distinction” between sections 17(2) and 18(4).

Foxton J considered the statutory language of sections 18(4) and 72(1) to be “clearly aimed at different issues”. Section 18(4) clarifies that an arbitrator’s powers and the effect of an award do not differ where the arbitrator in question is court-appointed rather than party-appointed. In short, section 18(4) is intended to apply to the outcome or effect of the appointment, but it does not apply to the participation of the non-participating party in the appointment process for any other purpose. Section 72(1), by contrast, refers to a person “alleged” to be a party to arbitral proceedings, and thus operates in circumstances where this is the issue in dispute which section 72 is intended to resolve.

Eland’s waiver of its right to arbitration

Foxton J also accepted that both of the Eland entities had, on the facts, elected to pursue the claims in the Accra Proceedings, and that they had therefore waived the right to refer those claims to arbitration – emphasising that this decision was based on the specific circumstances of this case and the status of Eland Ghana as a “sister company” to Eland Thailand. He therefore granted the declaration which NIB sought pursuant to section 72. He also relieved NIB of liability for the costs of Eland’s section 18 application.


This decision serves as a strong message to litigants that the “important protection” provided by section 72 to those parties who dispute a tribunal’s jurisdiction and take no part in the arbitral process is not eroded by section 18. An arbitral tribunal is competent to decide whether it has jurisdiction over the dispute submitted to it, and in most cases, parties challenging an arbitrator’s jurisdiction will make their case directly to the tribunal itself. However, Section 72 provides an alternative route to those parties who wish to challenge the tribunal’s jurisdiction, but prefer to have nothing to do with the arbitration and apply directly to the Court instead.

Foxton J’s comments on “the unattractive prospect of claims by companies in the same corporate group raising the same claims relating to the same contracts in court and arbitration” also serve as a reminder to be cautious about pursuing parallel proceedings in respect of the same matters via affiliate companies.