Even where parties have agreed that “the decision of the majority of the arbitrators…shall be final, conclusive and binding on the parties”, that of itself is not suffi cient to amount to an agreement to exclude the statutory right of appeal under section 69 of the Act.

Section 69(1) of the Arbitration Act 1996 provides that “Unless otherwise agreed by the parties, a party to arbitral proceedings may (upon notice to the other parties and to the tribunal) appeal to the court on a question of law arising out of an award made in the proceedings.’” In Shell Egypt West Manzala GMBH & Others v Dana Gas Egypt Ltd [2009] EWHC 2097 (Comm) the court concluded that the parties’ agreement that “the decision of the majority of the arbitrators…shall be final, conclusive and binding on the parties” was not of itself, and absent any other contextual indicators, suffi cient to amount to an agreement to exclude the statutory right of appeal under section 69 of the Act. Such an agreement would require express wording that was suffi ciently clear in order to be effective.

In Gloster J’s view, the words “final and binding” did no more than restate what has long been the rule, namely that an award is “fi nal and binding” subject to the provisions of the Act. In other words, an award is “fi nal” in the sense that the successful claimant is precluded by the award from bringing the same claim again in a fresh arbitration or action. An award can be said to be “binding” in that each party promises to abide by the award and to perform it – it is not a mere expression by the arbitrator of his view as to the referred dispute which a party is at liberty to disregard. The addition of the word “conclusive” was insuffi cient by itself to show that the parties intended to forego their statutory right of appeal. An award can be said to be “conclusive” of issues of fact and law, in that an award prevents a party in a subsequent arbitration or claim from disputing for a second time an issue of fact or law on which he has failed previously. Moreover, an award can also be said to be “conclusive” in that it precludes a party from reopening in a later dispute individual issues of law or fact that have been necessarily decided by the award.

To read the judgment go to: http://www.bailii.org/ew/cases/EWHC/Comm/2009/2097.html