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THE RIGHT STUFF

LEGAL

One aim of the 1996 Arbitration Act was to promote finality and party autonomy, writes Sue Lindsey. As a result, the rights of a party to appeal to the court on a point of law are heavily circumscribed. Not least, section 69(1) (one of the 'opt in/opt out' provisions of the Act) allows the parties to agree to exclude any appeal on a question of law.

But what notice is needed that the right to appeal is excluded? Is it good enough if the exclusion of the right to appeal is not expressly referred to in the body of the arbitration clause?

The High Court recently considered this question in Sukuman v The Commonwealth Secretariat (27 February 2006).

The claimant complained about an exclusion of the right to appeal that was not clear on the face of the contract.

It said that it should have had reasonable notice of such an exclusion, or that failure to give it that notice was a breach of Article 6 of the European Convention on Human Rights (the right to a fair and public hearing). The human-rights argument was available because the Commonwealth Secretariat (ComSec) is a public body for the purposes of the Convention.

ComSec enters into contracts for the provision of aid by way of services to the governments of Commonwealth states. ComSec's contract with Sukuman included its usual clause that any dispute was to be resolved by arbitration under the auspices of the Commonwealth Secretariat Arbitration Tribunal.

The tribunal has its own statute.

The arbitration clause said that any arbitration would be in accordance with the statutory provisions, but did not say what they were.

When Sukuman tried to appeal an arbitration award, it found itself up against the exclusion of the right to appeal contained in the statute.

In concluding that the exclusion provision was effective, Mr Justice Colman observed that clauses excluding liability can be incorporated by reference to terms and conditions contained in other documents. He referred to a case in which a series of invoices from a freight firm had said that the Institute of Freight Forwarders' standard terms applied. The Court of Appeal had held that those terms, and the exclusion of liability contained in them, has become part of the contract between the parties.

In Sukuman, the judge saw no reason to impose a different test for an exclusion of a right to appeal.

The need or otherwise of arbitrations to comply with the Article 6 provisions has been the subject of other proceedings.

Questions have included the resolution of the right to a public hearing and the usual position in arbitration that hearings are confidential. In finding against Sukuman on its second ground, the judge used an analysis similar to that we have seen in other cases. Parties entering into such agreements consensually disengage from their entitlements under Article 6.

So there is no need for the exclusion of a right to appeal, or it would seem any other agreement on the 'opt in/opt out' provisions of the 1996 Act, to be spelt out in the arbitration clause itself. It is for a contracting party to satisfy itself as to what is in any applicable rules or other incorporated documents.

Sue Lindsey is a barrister at Crown Office Chambers in London.

Visit www. crownofficechambers. com

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