Section 70(3) of the Arbitration Act 1996 provides that any challenge to, or appeal from, an arbitration award must be brought within 28 days of the date of the award. The award here was dated 27th March and so the deadline for a challenge/appeal was 24th April. The claimant paid its share of the arbitrator's fees shortly before the deadline but the defendants paid their share of all outstanding fees on or about 29thMay. The award was released on 20th June and the arbitration claim form issued on 7th July (ie 74 days after the statutory time limit). The claimant sought an extension of time under section 80(5) of the Act. Eder J rejected that application for the following reasons:
- Applying the principles set out in Terna Bahrain v Al Shamsi (see Weekly Update 43/12), it was appropriate to consider the merits of the challenge and appeal first, before considering the extension of time application (even though no challenge/appeal could be brought if the application was not brought in time). That was because the strength of the challenge/appeal was a factor to be taken into account when deciding whether to extend time.
- Leaving aside the strength of the challenge/appeal, there were other relevant factors which very strongly pointed against the grant of an extension. A delay of even a few days was said to be significant – here, to allow a party such a significant period of delay would undermine the policy of the Act, with its emphasis on speed and finality.
- If the claimant had wanted to reserve the right to bring a challenge/appeal, it should have paid all of the fees itself up-front, notwithstanding an arrangement between the parties to split the chairman's fees and pay their own appointed arbitrator themselves: "In that context, I bear in mind the mandatory provision of section 28(1) of the Act that imposes a joint and several liability of parties to pay the arbitrators' reasonable fees and expenses".
- Although it was "very surprising" that it had taken the tribunal some 22 days after payment of the outstanding fees to release the award, the claimant had been inactive during this period and had not asked the defendant if/when the fees would be paid. The further delay of 17 days after the award was released before the issue of proceedings, although not unreasonable in itself, had to be seen in context.
- In any event, the challenge and appeal would have been refused on their merits.