Comparables – whether arbitrator guilty of giving evidence to himself
Q The Court of Appeal decision in Checkpoint Ltd v Strathclyde Pension Fund [2003] EWCA Civ 84; [2003] 1 EGLR 1 shows that appealing against the fixing of a rent by arbitration can be an uphill battle where the sole or main ground is that the arbitrator has relied too heavily upon his own knowledge of rent within the relevant locality. So how does the dissatisfied party go about rating his chances of success?
A Looking at the broad picture, he has to show: (a) an irregularity on the arbitrator’s part; and (b) that the irregularity was both “serious” within the meaning of section 68 of the Arbitration Act 1996, and an effective cause of the arbitrator reaching the disputed decision. The issues in (b) are largely factual, but valuable guidance can be found in the first-instance decision (see [2002] 2 EGLR 97), which remains unaffected by what was said on appeal.
Turning to (a), the would-be appellant does indeed face a difficult task if, as was found in Checkpoint , the rent review clause had expressly or impliedly empowered the arbitrator to exercise “inquisitorial powers”, that is to say, work on information (say, rent obtained for a comparable property) other than that put forward by the parties. In such a case, subject to an important proviso, he can, as it were, furnish himself with such information as one would reasonably expect him to have as a person possessing the experience required by the terms of the lease or other prior agreement. The proviso is that the arbitrator must give the parties an opportunity to make representations on the new evidence coming from his own experience.
Checkpoint has little or nothing to say about arbitrators who do not possess the wider powers considered above. Presumably, the arbitrator can rely upon his general experience, but not upon any particular transaction in which he may have been involved. But even if he oversteps the line, the dissatisfied party must still deal with the issues of seriousness and causation mentioned in the first paragraph of this practice point.
Related items:
- Sandi Murdoch’s review of the Court of Appeal decision in Personal attention Estates Gazette 5 April 2003, p120.
- For a review of the first instance decision, see No cause for complaint Estates Gazette 20 July 2002, p148.
- See also Sandi Murdoch’s comment on the case of Guardcliffe Properties Ltd v City & St James [2003] EWHC 215; [2003] 25 EG 143, another case involving an arbitrator’s serious irregularity: Irregular goings-on Estates Gazette 24 May 2003, p189.
Comparables – whether arbitrator guilty of giving evidence to himself
Q The Court of Appeal decision in Checkpoint Ltd v Strathclyde Pension Fund [2003] EWCA Civ 84; [2003] 1 EGLR 1 shows that appealing against the fixing of a rent by arbitration can be an uphill battle where the sole or main ground is that the arbitrator has relied too heavily upon his own knowledge of rent within the relevant locality. So how does the dissatisfied party go about rating his chances of success?
A Looking at the broad picture, he has to show: (a) an irregularity on the arbitrator’s part; and (b) that the irregularity was both “serious” within the meaning of section 68 of the Arbitration Act 1996, and an effective cause of the arbitrator reaching the disputed decision. The issues in (b) are largely factual, but valuable guidance can be found in the first-instance decision (see [2002] 2 EGLR 97), which remains unaffected by what was said on appeal.
Turning to (a), the would-be appellant does indeed face a difficult task if, as was found in Checkpoint , the rent review clause had expressly or impliedly empowered the arbitrator to exercise “inquisitorial powers”, that is to say, work on information (say, rent obtained for a comparable property) other than that put forward by the parties. In such a case, subject to an important proviso, he can, as it were, furnish himself with such information as one would reasonably expect him to have as a person possessing the experience required by the terms of the lease or other prior agreement. The proviso is that the arbitrator must give the parties an opportunity to make representations on the new evidence coming from his own experience.
Checkpoint has little or nothing to say about arbitrators who do not possess the wider powers considered above. Presumably, the arbitrator can rely upon his general experience, but not upon any particular transaction in which he may have been involved. But even if he oversteps the line, the dissatisfied party must still deal with the issues of seriousness and causation mentioned in the first paragraph of this practice point.
Related items:
Sandi Murdoch’s review of the Court of Appeal decision in Personal attention Estates Gazette 5 April 2003, p120.
For a review of the first instance decision, see No cause for complaint Estates Gazette 20 July 2002, p148.
See also Sandi Murdoch’s comment on the case of Guardcliffe Properties Ltd v City & St James [2003] EWHC 215; [2003] 25 EG 143, another case involving an arbitrator’s serious irregularity: Irregular goings-on Estates Gazette 24 May 2003, p189.
