London Maritime Arbitration

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Appointment of arbitrators and umpires

A. Introduction

10.1 It is important to ensure that an arbitrator is properly appointed, as failure to make a valid appointment, or an appointment which does not cover a relevant dispute, may have far-reaching consequences: an award made by an incorrectly appointed tribunal may be set aside as invalid and the defective appointment may be incurable if the time limit for commencing arbitration has expired.1 The first place to look in order to determine the correct steps for appointing an arbitrator is the arbitration clause. In many cases, however, the arbitration clause (or the rules which it incorporates) will provide no express assistance. In the absence of any other agreement it is necessary to rely on the statutory rules governing appointment. Under English law, the appointment of an arbitrator is based on consent; no special formalities are required and it is essentially a matter of obtaining the arbitrator’s agreement to act and then notifying the other side of that agreement. 10.2 The statutory provisions on appointment are contained in a single section of the 1996 Act entitled “The Arbitral Tribunal”. These provisions give priority to the parties’ choice: section 16(1) makes clear that “the parties are free to agree on the procedure for appointing the arbitrator or arbitrators”. The statutory rules are only applicable in the absence of agreement otherwise and court intervention is minimised to cases where the parties cannot agree and the statutory framework fails to provide a solution. Any agreement on appointment of arbitrators or umpires must be in writing to be given effect under the 1996 Act (see section 5 of the Act).

B. Number of arbitrators to be appointed

10.3 The starting point is the parties’ agreement on how many arbitrators are to be appointed. This will ordinarily be found in the arbitration clause. Section 15 of the 1996 Act provides that:
  • (1)

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    The parties are free to agree on the number of arbitrators to form the tribunal and whether there is to be a chairman or umpire.
  • (2) Unless otherwise agreed by the parties, an agreement that the number of arbitrators shall be two or any other even number shall be understood as requiring the appointment of an additional arbitrator as chairman.
  • (3) If there is no such agreement, the tribunal shall consist of a sole arbitrator.
10.4 Section 15(1) follows Article 10 of the Model Law and reflects the principle of party autonomy underlying the Act. Section 15(2) gives statutory recognition to the office of chairman whilst section 20 sets out the role of the chairman (see on decision making). The LMAA Terms largely follow sections 15 and 20 of the Act in providing that if the tribunal is to consist of three arbitrators, the third arbitrator shall be the chairman (unless agreed otherwise) and his view shall prevail in relation to a decision in which there is neither unanimity nor a majority.2 The LMAA Intermediate Claims Procedure provides that in the absence of agreement the tribunal is to consist of three arbitrators. 10.5 Section 15(3) retains the previous rule that the tribunal should consist of a sole arbitrator in the absence of agreement on the number of arbitrators.3 For example, where a contract simply provides for “arbitration in London” with no reference to the size of the tribunal, there is a statutory presumption that a sole arbitrator is to be appointed. Even if the contract refers to “arbitrators” but does not specify their number, there is no agreement on the number of arbitrators for the purpose of section 15(3), with the consequence that a sole arbitrator is to be appointed.4 However, if the clause specifies arbitration in London “in the customary manner” or “in the usual way” this may amount to a choice excluding the statutory presumption.

In The Laertis,5 Bingham J found that arbitration in London “in the customary manner” was a reference to two arbitrators. Evidence from nine London arbitrators had been given which indicated that this type of tribunal was most frequently used in London arbitrations. It would probably now be found that tribunals of three arbitrators (rather than two arbitrators plus an umpire) are most common in maritime arbitrations. In particular, there are many three arbitrator arbitration clauses (e.g., the BIMCO arbitration clause, clause 17 of the NYPE 1946 charterparty form and clause 54 of the NYPE 2015 charterparty form) and it is the invariable practice of LMAA arbitrators to ask the parties to agree that any umpire be treated as a third arbitrator, a proposal that is normally accepted.

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