Arbitration Act 1966

Arbitration in England is governed by the Arbitration Act 1996 (the "Act"). The Act presents a statutory basis from which to enforce arbitration awards.

Section 66 of the Arbitration Act 1996

Under Section 66(1) of the Arbitration Act 1996:

"An award made by the tribunal pursuant to an arbitration agreement may, by leave of the court, be enforced in the same manner as a judgment or order of the court to the same effect."

To obtain the leave (permission) of the court an applicant has to be make a court application.. The application is made without notice to the opponent (respondent). Permission to enforce is usually given; judgment can then be entered in the terms of the award and the judgment can be enforced in the same way as a judgment.

Court requirements

An application for permission to enforce the award may be made to the High Court without notice to the respondent. The application must be supported by written evidence exhibiting the arbitration agreement and the original award (or copies of it). The application must also:

  1. state the name and place of residence or business of the applicant and the respondent; and
  2. state either that the award has not been complied with or the extent to which it has not been complied with as at the date of the application.

On being granted permission to enforce the award, the order giving that permission must be served on the respondent who must be informed that it can apply to the court to set aside the order. The period to do so will be 14 days after service of the order or, if served outside the jurisdiction of the English Court, then within such period as the court may direct.

Enforcement of an award by summary procedure under s.66 Arbitration Act 1996

Where awards are made by domestic tribunals these are usually enforced by summary procedure under s.66.

An application may be made in relation to:

  1. the entire award;
  2. any part of the award that is left unpaid;
  3. the unpaid interest on the award; or
  4. the costs of the award.

The right of enforcement under s.66 of the Act has been held by the Court of Appeal to apply to declaratory awards where the applicant is seeking to establish the primacy of a declaratory award over an inconsistent judgment and where there is a reasonable prospect of primacy being established.

Once the applicant has produced to the court a valid award and arbitration agreement, the burden then shifts to the respondent who must provide evidence showing why the award ought not to be enforced.

Time barring

The limitation periods (time-barring periods) applying to the enforcement of awards under s.66 of the Act mirror those which would apply to a court action on the award, being six years from the accrual date of the cause of action or twelve years if the arbitration agreement is under seal. The accrual date for these purposes is the date on which the obligation to carry out the award is breached. Note that enforcement of an award in England & Wales may still be possible despite the enforcement being time-barred in other jurisdictions.

Grounds for refusing permission to enforce an award under s.66 Arbitration Act 1996

Mandatory Grounds

S.66(3) of the Act provides that, where the Arbitration Tribunal lacks substantive jurisdiction to make an award, the court will not grant permission to enforce it. The right to object to the substantive jurisdiction of the Tribunal may be lost if such an objection was not made either forthwith or within such time as is allowed by the arbitration agreement, or within 28 days of the date of the award.

Where the award has been made following an oral arbitration agreement, it will not be possible to enforce that award under s.66 of the Act.

Discretionary Grounds

A number of grounds on which enforcement may be refused by the discretion of the courts have been recognised, many of which resemble the defences against enforcement of an award under the New York Convention. These include refusing permission to enforce an award that is ambiguous or defective, or where the application to enforce is time-barred. The courts may also refuse permission to enforce an award on the grounds of public policy (which is not excluded in the Act) where the court considers that public policy would not recognise the validity of such an award. Such an award may be described as one that attempts “to decide matters which our law does not accept can be resolved be this means”. The courts will also take into account any failure to take action in the courts of the seat of the arbitration where grounds for refusal of enforcement have been established.

Invalidity

The presumption is that summary enforcement will be permitted unless there is a real ground for doubting the validity of an award.

Estoppel

If there is a foreign judgment on the merits of the action pending, an applicant may be estopped from having an award enforced by the court.