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As a matter of policy, the Arbitration Act 1996 gives a disgruntled party limited opportunities to challenge an arbitrator's award, writes Sue Lindsey. The underlying principle is that commercial parties are free to agree how their disputes are to be resolved with minimal intervention by the courts.

Challenges are only available if the tribunal lacked jurisdiction, or if there has been a serious irregularity, or appeal on a point of law (Sections 67, 68 and 69). If the matter gets to court, but then one party wants to appeal the judge's decision, things get still more hemmed in. Any appeal to the Court of Appeal from the judge's decision can only be brought with that judge's leave.

If the judge refuses, is there anyone left to appeal to, and on what basis?

The Court of Appeal recently gave judgments on the same day in two cases touching on this question; CGU International Insurance v AstraZeneca Insurance and ASM Shipping v TTMI (16 October 2006).

In the CGU case, the arbitral tribunal had reached a majority 2:1 decision on what was the applicable law.

The losing party appealed to the court. The judge decided that the minority view was the correct one and refused leave to appeal. The Court of Appeal fi rst had to decide whether it could hear the matter at all, given that the judge below had refused permission for it to go to them.

Everyone agreed that the effect of the Arbitration Act is that there is no appeal on the merits of a judge's decision, either as to the right answer or a refusal of leave to appeal, unless that judge gives leave.

But the appellant argued that the Court of Appeal has a residual discretion to permit an appeal on the judge's refusal of permission if that refusal was unfair and contrary to Article 6 of the European Convention on Human Rights, the right to a fair hearing.

The Court explored the interplay of the Arbitration Act, the Supreme Court Act (which gives the Court its powers) and the Human Rights Act, and concluded there were several possible ways of looking at the statutes that meant it did have such a residual jurisdiction. But the jurisdiction is very limited, only being triggered by something so unfair that the decision to refuse leave is invalid. The Court concluded that there had been no such unfairness in this case.

The second case concerned an alleged serious irregularity pursued under Section 68. One party alleged apparent bias on the part of a member of the arbitral tribunal. The judge decided that there had been apparent bias, but that the complaining party had waived its objection. The judge then refused permission to appeal.

The appellant sought to use the Human Rights Act to persuade the Court of Appeal to give leave to appeal. There was no complaint about the fairness of the process of the judge's decision, so the residual jurisdiction discussed in CGU did not come into play. Instead the appellant argued that the judge, having accepted that there was apparent bias, was himself in breach of the Convention by failing to put it right. The Court concluded that the judge's decision had not breached the appellant's Convention rights, and that they had no jurisdiction to grant leave to appeal.

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