In Guangzhou Dockyards Co. Ltd v E.N.E. Aegiali I [2010] EWHC 2826 (Comm), a judgment of 5 November 2010, the Commercial Court dismissed an appeal against an arbitral award made on a question of fact.

In his judgment, Blair J considered it "very doubtful" that the court had jurisdiction to hear an appeal of arbitrators' findings of fact. This was so even if the parties had agreed to such an appeal, although as a matter of construction of the arbitration clause of the contract, Blair J concluded that they had not so agreed.


The original dispute concerned a contract under which the Claimant dockyard agreed to make alterations to a ship owned by the Respondent. The contract was governed by English law, and contained an arbitration clause providing for LMAA arbitration in London. The work could not be performed, and the dispute was over the cause. The arbitral tribunal found in favour of the Respondent, and awarded damages and a refund of the first instalment of the contract price.

Following the award, the Claimant issued two separate claims in the Commercial Court. First, it appealed on issues of law, a question that remains to be determined. Secondly, it appealed on issues of fact, principally on a question of Chinese law (which as the contract was governed by English law was considered an issue of fact). The court's judgment was concerned with this second claim.

Arguments of the parties

The arbitration agreement included the statement that "The Parties agree that either Party may appeal to the English High Court on any issue arising out of the award." The Claimant argued that this evidenced an agreement between the parties that questions of fact could be appealed to the court. Further, it argued the court had jurisdiction under section 69 of the Arbitration Act 1996 (the "Act") to consider questions of fact, notwithstanding that section 69 only referred to appeals on issues of law. Moreover, this was consistent with the principle of party autonomy enshrined by the Act, and fell within the inherent jurisdiction of the court.

The Respondent applied to strike out this part of the appeal. It argued that the only appeal permitted under the Act is one on a point of law, and that parties cannot confer jurisdiction by agreement where none exists. It also disputed that there had been an agreement that findings of fact could be appealed to the court.


Jurisdiction of the court to hear appeals of arbitral awards on a question of fact

The court made the following principal determinations:

  • The opening words of section 69 of the Act, "Unless otherwise agreed by the parties...", refer to an agreement by the parties in the context of an appeal on a question of law. These words cannot be construed so as to expand the jurisdiction of the court to include an appeal to the court on a question of fact on the basis that the parties have agreed to such an appeal; and
  • The principle of party autonomy enshrined in s1(b) of the Act refers to the conduct of the arbitration. It does not concern the role of the court or the interface between the court and the tribunal.

Accordingly, the court affirmed the view of Mustill J in The Chrysalis [1983] 1 Lloyd's Rep. 503 that, under English law, it is very doubtful that the court has jurisdiction to hear an appeal of an arbitral award on a question of fact, even if the parties were to agree to such an appeal.

Agreement between the parties

In any event, as a matter of construction of the arbitration agreement, the court held that the parties had not agreed to allow an appeal on a question of fact. Given the exceptional nature of such an agreement, clear wording would be required, which was not present in this case.


Finality and limited judicial review are widely considered to be amongst the key advantages of arbitration over litigation. The inclusion of section 69 in the Act, which represents a departure from the UNCITRAL Model Law and from arbitration law in many jurisdictions, was controversial at the time. This was acknowledged in the DAC report at the time of drafting and the clause was consequently drawn in very narrow terms (see DAC Report commentary on section 69). That the Commercial Court has determined that the clause cannot be extended or exploited to give it jurisdiction to hear an appeal on a point of fact, even where parties may have so agreed, is therefore unsurprising.

This decision is also reminiscent of the US judgments in Kyocera Corp v Prudential-Backe Trade Services Inc 341 F 3d 987 (9th Cir 2003) and Hall Street Associates LLC v Mattel Inc (2008) 552 US 576 (Sup Ct) where it was held that parties could not alter or expand grounds for reviewing arbitral decisions under the Federal Arbitration Act, and that any contractual provision that purported to do so was legally unenforceable.