The insured sought to claim under three insurance policies (one issued by Insurer A, two by Insurer B). The policies were all written on the Bermuda form, which provides for London arbitration and the appointment of three arbitrators. Where the two party appointed arbitrators cannot agree the appointment of the third arbitrator, an application may be made to the English court.
The insured and Insurer A agreed the appointment of the third arbitrator in their arbitration. However, no such agreement was reached in the two further arbitrations between the insured and Insurer B. Accordingly, an application was made to court.
The insured wished to appoint the same third arbitrator as the one appointed in its arbitration with Insurer A. It argued that this would reduce the risk of inconsistent decisions and also reduce costs and delay. Leggatt J agreed that there was bound to be a substantial overlap between the issues in all three arbitrations, given that the policies were written in identical terms and covered the same risks. If this had been litigation, the court would almost certainly have ordered the three claims to be managed and tried together in the interests of efficiency and to avoid the risk of inconsistent results.
However, this was arbitration instead, and the court has no power under the Arbitration Act 1996 to order consolidation or coordination of the arbitration proceedings (and the tribunal can only do so with the consent of the parties). Although the judge found that there would be no inference of apparent bias for the same third arbitrator to hear all three arbitrations, nevertheless Insurer B had a legitimate basis for objecting to his appointment, since that person might be influenced by arguments and evidence in the arbitration between the insured and Insurer A. Furthermore, Insurer B would be unable to made submissions, or be privy to evidence adduced, in the arbitration involving Insurer A.
For that reason, the insured's proposal was rejected. The judge did however agree that the same person should be appointed as the third arbitrator in both arbitrations involving the insured and Insurer B. That was because the parties were identical in both arbitrations and would be represented by the same lawyers, who would therefore know what was happening in both arbitrations.
As to the particular individual to be appointed, he chose the arbitrator who had only recently retired from the bench because: "it therefore seems likely that he may have better availability and less likelihood of any conflict than other individuals who have been acting as arbitrators for longer".