Whether right to object to arbitrator's jurisdiction had been lost/the meaning of "takes part"


The appellant applied to set aside an order to enforce an arbitration award against him. Section 73 of the Arbitration Act 1996 provides that a party may lose the right to object (eg on the ground that the arbitrator lacked jurisdiction) if he "takes part" in the proceedings without objection. In this case, the appellant had taken no part in the arbitration, but he had told the respondent that the proposed arbitrator was "in principle….acceptable to me". The Court of Appeal held that "a party who participates in the appointment of an arbitrator without qualification does take part in the arbitration proceedings for the purposes of section 73".

In this case, though, although the appellant had accepted the arbitrator as being independent and impartial, he had disputed his appointment under a contract (contract no. 2) on the ground that he had not entered into that contract (although he did accept that he had entered into a separate contract (contract no.1) in respect of which there was going to be arbitration). The appellant had therefore not lost his right to challenge the arbitrator's jurisdiction in relation to contract no.2.

The appellant still had to show that he had a real prospect of success in proving that there had been no agreement to arbitrate and he was able to do that on the facts.

COMMENT: This case might be compared with the recent decision in Sierra Fishing v Farran (see Weekly Update 05/15), where it was held that inactivity or silence does not amount to taking part within the meaning of section 73. In that case, the claimant had indicated that it would be appointing its own arbitrator, and that did not amount to taking part because the claimant did not recognise the tribunal as being properly constituted yet. By contrast, the party here had participated to some degree in the appointment of the arbitrator and that would normally amount to taking part (although for the reason explained above, it did not in this case).