Sze Hian Ng<\/a><\/strong>, Associate
Luke Adams<\/a><\/strong>, Associate at A&O Shearman<\/strong><\/a><\/p>\n\n\n\n
\n\n\n\n
Introduction<\/strong><\/h2>\n\n\n\nIn Contour Global v. Kosovo (II), Judgment of the High Court of Justice of England and Wales [2024] EWHC 877, 15 April 2024<\/a> the English High Court rejected a s. 68 challenge by the Government of Kosovo<\/a> (GOK<\/strong>) against an award issued in favour of Contourglobal Kosovo (CKL<\/strong>). The case raises interesting questions about the extent to which an English court exercising supervisory jurisdiction should concern itself in the procedural niceties of an arbitration but ultimately affirms the high bar imposed upon any party seeking to clear the \u201cserious irregularity\u201d causing \u201csubstantial injustice\u201d limbs of s.68. <\/p>\n\n\n\n<\/div>\n\n\n\nBackground<\/strong><\/span><\/h2>\n\n\n\nThe dispute arose out of a series of contracts pursuant to which CKL agreed to design, construct, and operate a power plant for GOK<\/a>. One of the contracts obliged GOK to perform certain conditions precedent by a specific date. CKL alleged that these conditions had not been met, which entitled it to terminate the agreements and claim development costs up to a contractually agreed cap of \u20ac19.7 million. The dispute was referred to arbitration under the ICC Rules.<\/p>\n\n\n\nThe s.68 challenge related to the majority of the Tribunal\u2019s decision on quantum (the Majority<\/strong>). GOK<\/a> maintained that CKL had failed to substantiate any of the development costs it claimed, despite CKL adducing a series of quarterly summaries and invoices. <\/p>\n\n\n\nFollowing the hearing, the Tribunal issued a procedural order providing that:<\/p>\n\n\n\n
\u201cThe Tribunal has not decided issues of liability and may not reach damages issues [sic.]. Should it do so, however, the Tribunal considers that analysis and organisation of the existing record regarding [CKL\u2019s] development costs, and the costs of GOK studies is not sufficiently complete, and it may decide to appoint an expert to investigate and report on those matters pursuant to Article 25(3).\u201d<\/p>\n\n\n\n
The Tribunal reiterated this point in a subsequent procedural order (collectively, the Procedural Orders<\/strong>).<\/p>\n\n\n\nIn its final award, the Majority awarded the development costs to CKL without appointing an expert (the Award<\/strong><\/a>). On quantum, the Majority found that the quarterly summaries and invoices showed an \u201cindicia of regularity\u201d sufficient to substantiate the development costs. <\/p>\n\n\n\n<\/div>\n\n\n\nThe S. 68 Challenge<\/strong><\/h2>\n\n\n\nDissatisfied with the outcome, GOK<\/a> challenged the Award. It alleged that the Procedural Orders created a \u201creasonable expectation\u201d that the evidence adduced by CKL was insufficient. According to GOK, this meant that the Tribunal should have:<\/p>\n\n\n\n\n- dismissed the claim;<\/li>\n\n\n\n
- appointed an expert accountant to review the evidence; or<\/li>\n\n\n\n
- asked the parties to provide further evidence or submissions.<\/li>\n<\/ul>\n\n\n\n
The Majority did none of these things. <\/p>\n\n\n\n
GOK<\/a> also argued that the Award contradicted the Tribunal\u2019s prima facie evidential findings as set out in the Procedural Orders. The Majority did not provide an explanation for its apparent change in position, nor did it give GOK an opportunity to make further submissions. GOK alleged that the Majority had therefore failed in its duty to act fairly and impartially under s. 33(1)(a) of the Arbitration Act. This, GOK argued, constituted a serious irregularity under s. 68(2)(a) of the Arbitration Act.<\/p>\n\n\n\n<\/div>\n\n\n\nNo Serious Irregularity<\/strong><\/h2>\n\n\n\nIn the first instance, the High Court set out the applicable principles for a s. 68(2)(a) challenge which are well-established and were not disputed. To succeed, the applicant must prove that the tribunal\u2019s failure to act fairly and impartially:<\/p>\n\n\n\n
\n- amounted to a serious irregularity<\/li>\n\n\n\n
- gave rise to substantial injustice. <\/li>\n<\/ul>\n\n\n\n
This test imposes a high threshold. It reflects a legislative aim to minimise curial intervention, such that relief under s. 68 will only be granted where the tribunal\u2019s conduct is \u201cso far removed from what could reasonably be expected from the arbitral process that justice calls out for it to be corrected\u201d. Moreover, the court will generally grant a good deal of latitude to a tribunal in how it conducts an arbitration and will be slow to find that its conduct amounts to a breach of its due process duties under s. 33.<\/p>\n\n\n\n
English courts also tend to construe arbitral awards and procedural orders in a reasonable and commercial way, in light of \u201cwhat a reasonable person, reading that paragraph in its relevant context, would have concluded the Tribunal was saying\u201d. This aligns with the courts\u2019 default preference not to approach awards \u201cwith a meticulous legal eye endeavouring to pick holes, inconsistencies, and faults\u201d.<\/p>\n\n\n\n
Applying these principles, the High Court found that the Procedural Orders did not suggest that the Tribunal had predisposed of CKL\u2019s quantum case. The reference to the existing record \u201cnot being sufficiently complete\u201d simply acknowledged a comment made by the dissenting arbitrator during the hearing that CKL had left the Tribunal to make its own assessment of the evidence. This comment led to the suggestion that the Tribunal might consider appointing an expert to assist it with that analysis. There was nothing in the Procedural Orders capable of generating a \u201creasonable expectation\u201d that the Tribunal should not determine the quantum issue without further evidence or submissions.<\/p>\n\n\n\n
The High Court also rejected GOK<\/a>\u2019s argument that there were only three options available to the Tribunal due to its (alleged) findings in the Procedural Orders. To do so would put the horse before the cart, by dismissing CKL\u2019s case on quantum before properly considering it. Nor did the Procedural Orders impair the Tribunal\u2019s ability to assess the evidence provided by CKL independently. Rather, the Tribunal only alluded to the possibility of appointing an expert accountant to assist it with its analysis. The Tribunal was perfectly entitled to render the Award without doing so. <\/p>\n\n\n\nIt was therefore \u201cnext to impossible\u201d for the High Court to conclude that an \u201cenormously experienced international Arbitral Tribunal\u201d had predetermined the entirety of CKL\u2019s quantum case based on a single paragraph in a procedural order. If this had been the Tribunal\u2019s intention, then it would have said so in an award.<\/p>\n\n\n\n
Indeed, to read the Procedural Orders in the way suggested by GOK<\/a> would go against the \u201creasonable and commercial\u201d construction of arbitral awards preferred by the courts. GOK\u2019s \u201cafter-the-event\u201d position relied on \u201ctechnical inconsistencies and faults precisely as [the] case law warns against\u201d. In reality, the Majority\u2019s conduct was not \u201cso far removed from what could reasonably be expected\u201d in the ordinary course.<\/p>\n\n\n\n<\/div>\n\n\n\nNo Substantial Injustice<\/strong><\/h2>\n\n\n\nEven though no serious irregularity was found, the High Court also made some obiter observations about the \u201csubstantial injustice\u201d test. To establish substantial injustice, GOK<\/a> needed to show that \u201chad the Tribunal acted as [GOK] contends it should have, the outcome might well have been different\u201d. It is not a requirement to show that the result would necessarily (or even probably) have been different.<\/p>\n\n\n\nOn this issue, the High Court found that GOK had made no attempt (whether by adducing its own expert report or otherwise) to show the court that it would have advanced new evidence or made further submissions discrediting CKL\u2019s quantum case had it been given the opportunity to do so. Without any new evidence, it was \u201centirely unreal\u201d that the Tribunal would have dismissed CKL\u2019s claim had it asked the parties to make further submissions.<\/p>\n\n\n\n
<\/div>\n\n\n\nCommentary<\/strong><\/h2>\n\n\n\nThis decision serves as a helpful reminder of the high threshold that English law imposes on parties seeking to bring a s. 68 challenge. Although the language in the Procedural Orders appeared to indicate (at least at face value) that the Tribunal considered the evidentiary record on the quantum issue to be insufficient, the High Court chose not to delve into the procedural minutiae of the underlying arbitration. Instead, it focused on interpreting the actions of the Tribunal in a pragmatic way.<\/p>\n\n\n\n
This, in turn, reflects a broader principle. In striving to uphold arbitral awards, the courts will seek to afford tribunals some latitude. Section 68 merely functions as a \u201clongstop in extreme cases\u201d and cannot be used to \u201cappeal\u201d an award simply because a party is dissatisfied with the outcome.<\/p>\n\n\n\n
The High Court also touched on the type of evidence required to satisfy the \u201csubstantial injustice\u201d test. In principle, the applicant must show the court that:<\/p>\n\n\n\n
\n- it would have adduced new evidence that the tribunal had not previously considered<\/li>\n\n\n\n
- the new evidence \u201cwould have had an important influence on the result\u201d (See, P&ID v. Ministry of Petroleum of Nigeria, Judgment of the High Court of Justice of England and Wales [2023] EWHC 2638, 23 October 2023, para. 502<\/a>). <\/li>\n<\/ul>\n\n\n\n
If the outcome of the arbitration would have been the same regardless of any irregularity, then no substantial injustice would have occurred.<\/p>\n\n\n\n
<\/div>\n\n\n\n
\n\n\n\nABOUT THE AUTHORS<\/strong><\/p>\n\n\n\nSze Hian Ng<\/strong><\/a> is an associate focussing on international arbitration. His experience covers international commercial and investment treaty arbitrations under LCIA<\/a>, HKIAC<\/a>, SIAC<\/a>, and ICSID<\/a> Rules. He has also assisted with enforcement and setting aside proceedings before the English and Singapore courts.<\/p>\n\n\n\nLuke Adams<\/strong><\/a> is an associate in the London International Arbitration team at A&O Shearman<\/strong><\/a>.<\/strong> He advises on international commercial and investment treaty arbitrations under the rules of various institutions (including the LCIA<\/a>, HKIAC<\/a>, and SIAC<\/a>).<\/p>\n\n\n\n
\n\n\n\n![\"\"](\"https:\/\/dailyjus.com\/wp-content\/uploads\/2024\/02\/2024-02-LVYAP-dj-banner-1024x343.png\")
<\/figure>\n<\/div>\n\n\n*The views and opinions expressed by authors are theirs and do not necessarily reflect those of their organizations, employers, or Daily Jus, Jus Mundi, or Jus Connect.<\/em><\/em><\/p>\n","protected":false},"excerpt":{"rendered":"The English High Court in Contour Global v. Kosovo dismissed a s. 68 challenge to an ICC award, affirming the high bar for proving serious irregularity and substantial injustice.<\/p>\n","protected":false},"author":4,"featured_media":283088,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jnews-multi-image_gallery":[],"jnews_single_post":{"subtitle":"","format":"standard","video":"","gallery":"","source_name":"","source_url":"","via_name":"","via_url":"","override_template":"0","override":[{"template":"custom","single_blog_custom":"274736","parallax":"1","fullscreen":"1","layout":"right-sidebar","sidebar":"author","second_sidebar":"default-sidebar","sticky_sidebar":"1","share_position":"hide","share_float_style":"share-monocrhome","show_share_counter":"0","show_view_counter":"0","show_featured":"1","show_post_meta":"1","show_post_author":"0","show_post_author_image":"0","show_post_date":"1","post_date_format":"default","post_date_format_custom":"Y\/m\/d","show_post_category":"0","show_post_reading_time":"0","post_reading_time_wpm":"300","show_zoom_button":"0","zoom_button_out_step":"2","zoom_button_in_step":"3","show_post_tag":"0","show_prev_next_post":"0","show_popup_post":"0","number_popup_post":"1","show_author_box":"0","show_post_related":"0","show_inline_post_related":"0"}],"override_image_size":"0","image_override":[{"single_post_thumbnail_size":"crop-500","single_post_gallery_size":"crop-500"}],"trending_post":"0","trending_post_position":"meta","trending_post_label":"Trending","sponsored_post":"0","sponsored_post_label":"Sponsored by","sponsored_post_name":"","sponsored_post_url":"","sponsored_post_logo_enable":"0","sponsored_post_logo":"","sponsored_post_desc":"","disable_ad":"0"},"jnews_primary_category":{"id":"168","hide":""},"jnews_social_meta":{"fb_title":"English High Court Dismisses S. 68 Challenge to ICC Award Based on Tribunal\u2019s Procedural Orders","fb_description":"The English High Court in Contour Global v. Kosovo dismissed a s. 68 challenge to an ICC award, affirming the high bar for proving serious irregularity and substantial injustice.","fb_image":"283089","twitter_title":"English High Court Dismisses S. 68 Challenge to ICC Award Based on Tribunal\u2019s Procedural Orders","twitter_description":"The English High Court in Contour Global v. 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Background<\/strong><\/span><\/h2>\n\n\n\nThe dispute arose out of a series of contracts pursuant to which CKL agreed to design, construct, and operate a power plant for GOK<\/a>. One of the contracts obliged GOK to perform certain conditions precedent by a specific date. CKL alleged that these conditions had not been met, which entitled it to terminate the agreements and claim development costs up to a contractually agreed cap of \u20ac19.7 million. The dispute was referred to arbitration under the ICC Rules.<\/p>\n\n\n\nThe s.68 challenge related to the majority of the Tribunal\u2019s decision on quantum (the Majority<\/strong>). GOK<\/a> maintained that CKL had failed to substantiate any of the development costs it claimed, despite CKL adducing a series of quarterly summaries and invoices. <\/p>\n\n\n\nFollowing the hearing, the Tribunal issued a procedural order providing that:<\/p>\n\n\n\n
\u201cThe Tribunal has not decided issues of liability and may not reach damages issues [sic.]. Should it do so, however, the Tribunal considers that analysis and organisation of the existing record regarding [CKL\u2019s] development costs, and the costs of GOK studies is not sufficiently complete, and it may decide to appoint an expert to investigate and report on those matters pursuant to Article 25(3).\u201d<\/p>\n\n\n\n
The Tribunal reiterated this point in a subsequent procedural order (collectively, the Procedural Orders<\/strong>).<\/p>\n\n\n\nIn its final award, the Majority awarded the development costs to CKL without appointing an expert (the Award<\/strong><\/a>). On quantum, the Majority found that the quarterly summaries and invoices showed an \u201cindicia of regularity\u201d sufficient to substantiate the development costs. <\/p>\n\n\n\n<\/div>\n\n\n\nThe S. 68 Challenge<\/strong><\/h2>\n\n\n\nDissatisfied with the outcome, GOK<\/a> challenged the Award. It alleged that the Procedural Orders created a \u201creasonable expectation\u201d that the evidence adduced by CKL was insufficient. According to GOK, this meant that the Tribunal should have:<\/p>\n\n\n\n\n- dismissed the claim;<\/li>\n\n\n\n
- appointed an expert accountant to review the evidence; or<\/li>\n\n\n\n
- asked the parties to provide further evidence or submissions.<\/li>\n<\/ul>\n\n\n\n
The Majority did none of these things. <\/p>\n\n\n\n
GOK<\/a> also argued that the Award contradicted the Tribunal\u2019s prima facie evidential findings as set out in the Procedural Orders. The Majority did not provide an explanation for its apparent change in position, nor did it give GOK an opportunity to make further submissions. GOK alleged that the Majority had therefore failed in its duty to act fairly and impartially under s. 33(1)(a) of the Arbitration Act. This, GOK argued, constituted a serious irregularity under s. 68(2)(a) of the Arbitration Act.<\/p>\n\n\n\n<\/div>\n\n\n\nNo Serious Irregularity<\/strong><\/h2>\n\n\n\nIn the first instance, the High Court set out the applicable principles for a s. 68(2)(a) challenge which are well-established and were not disputed. To succeed, the applicant must prove that the tribunal\u2019s failure to act fairly and impartially:<\/p>\n\n\n\n
\n- amounted to a serious irregularity<\/li>\n\n\n\n
- gave rise to substantial injustice. <\/li>\n<\/ul>\n\n\n\n
This test imposes a high threshold. It reflects a legislative aim to minimise curial intervention, such that relief under s. 68 will only be granted where the tribunal\u2019s conduct is \u201cso far removed from what could reasonably be expected from the arbitral process that justice calls out for it to be corrected\u201d. Moreover, the court will generally grant a good deal of latitude to a tribunal in how it conducts an arbitration and will be slow to find that its conduct amounts to a breach of its due process duties under s. 33.<\/p>\n\n\n\n
English courts also tend to construe arbitral awards and procedural orders in a reasonable and commercial way, in light of \u201cwhat a reasonable person, reading that paragraph in its relevant context, would have concluded the Tribunal was saying\u201d. This aligns with the courts\u2019 default preference not to approach awards \u201cwith a meticulous legal eye endeavouring to pick holes, inconsistencies, and faults\u201d.<\/p>\n\n\n\n
Applying these principles, the High Court found that the Procedural Orders did not suggest that the Tribunal had predisposed of CKL\u2019s quantum case. The reference to the existing record \u201cnot being sufficiently complete\u201d simply acknowledged a comment made by the dissenting arbitrator during the hearing that CKL had left the Tribunal to make its own assessment of the evidence. This comment led to the suggestion that the Tribunal might consider appointing an expert to assist it with that analysis. There was nothing in the Procedural Orders capable of generating a \u201creasonable expectation\u201d that the Tribunal should not determine the quantum issue without further evidence or submissions.<\/p>\n\n\n\n
The High Court also rejected GOK<\/a>\u2019s argument that there were only three options available to the Tribunal due to its (alleged) findings in the Procedural Orders. To do so would put the horse before the cart, by dismissing CKL\u2019s case on quantum before properly considering it. Nor did the Procedural Orders impair the Tribunal\u2019s ability to assess the evidence provided by CKL independently. Rather, the Tribunal only alluded to the possibility of appointing an expert accountant to assist it with its analysis. The Tribunal was perfectly entitled to render the Award without doing so. <\/p>\n\n\n\nIt was therefore \u201cnext to impossible\u201d for the High Court to conclude that an \u201cenormously experienced international Arbitral Tribunal\u201d had predetermined the entirety of CKL\u2019s quantum case based on a single paragraph in a procedural order. If this had been the Tribunal\u2019s intention, then it would have said so in an award.<\/p>\n\n\n\n
Indeed, to read the Procedural Orders in the way suggested by GOK<\/a> would go against the \u201creasonable and commercial\u201d construction of arbitral awards preferred by the courts. GOK\u2019s \u201cafter-the-event\u201d position relied on \u201ctechnical inconsistencies and faults precisely as [the] case law warns against\u201d. In reality, the Majority\u2019s conduct was not \u201cso far removed from what could reasonably be expected\u201d in the ordinary course.<\/p>\n\n\n\n<\/div>\n\n\n\nNo Substantial Injustice<\/strong><\/h2>\n\n\n\nEven though no serious irregularity was found, the High Court also made some obiter observations about the \u201csubstantial injustice\u201d test. To establish substantial injustice, GOK<\/a> needed to show that \u201chad the Tribunal acted as [GOK] contends it should have, the outcome might well have been different\u201d. It is not a requirement to show that the result would necessarily (or even probably) have been different.<\/p>\n\n\n\nOn this issue, the High Court found that GOK had made no attempt (whether by adducing its own expert report or otherwise) to show the court that it would have advanced new evidence or made further submissions discrediting CKL\u2019s quantum case had it been given the opportunity to do so. Without any new evidence, it was \u201centirely unreal\u201d that the Tribunal would have dismissed CKL\u2019s claim had it asked the parties to make further submissions.<\/p>\n\n\n\n
<\/div>\n\n\n\nCommentary<\/strong><\/h2>\n\n\n\nThis decision serves as a helpful reminder of the high threshold that English law imposes on parties seeking to bring a s. 68 challenge. Although the language in the Procedural Orders appeared to indicate (at least at face value) that the Tribunal considered the evidentiary record on the quantum issue to be insufficient, the High Court chose not to delve into the procedural minutiae of the underlying arbitration. Instead, it focused on interpreting the actions of the Tribunal in a pragmatic way.<\/p>\n\n\n\n
This, in turn, reflects a broader principle. In striving to uphold arbitral awards, the courts will seek to afford tribunals some latitude. Section 68 merely functions as a \u201clongstop in extreme cases\u201d and cannot be used to \u201cappeal\u201d an award simply because a party is dissatisfied with the outcome.<\/p>\n\n\n\n
The High Court also touched on the type of evidence required to satisfy the \u201csubstantial injustice\u201d test. In principle, the applicant must show the court that:<\/p>\n\n\n\n
\n- it would have adduced new evidence that the tribunal had not previously considered<\/li>\n\n\n\n
- the new evidence \u201cwould have had an important influence on the result\u201d (See, P&ID v. Ministry of Petroleum of Nigeria, Judgment of the High Court of Justice of England and Wales [2023] EWHC 2638, 23 October 2023, para. 502<\/a>). <\/li>\n<\/ul>\n\n\n\n
If the outcome of the arbitration would have been the same regardless of any irregularity, then no substantial injustice would have occurred.<\/p>\n\n\n\n
<\/div>\n\n\n\n
\n\n\n\nABOUT THE AUTHORS<\/strong><\/p>\n\n\n\nSze Hian Ng<\/strong><\/a> is an associate focussing on international arbitration. His experience covers international commercial and investment treaty arbitrations under LCIA<\/a>, HKIAC<\/a>, SIAC<\/a>, and ICSID<\/a> Rules. He has also assisted with enforcement and setting aside proceedings before the English and Singapore courts.<\/p>\n\n\n\nLuke Adams<\/strong><\/a> is an associate in the London International Arbitration team at A&O Shearman<\/strong><\/a>.<\/strong> He advises on international commercial and investment treaty arbitrations under the rules of various institutions (including the LCIA<\/a>, HKIAC<\/a>, and SIAC<\/a>).<\/p>\n\n\n\n
\n\n\n\n<\/figure>\n<\/div>\n\n\n*The views and opinions expressed by authors are theirs and do not necessarily reflect those of their organizations, employers, or Daily Jus, Jus Mundi, or Jus Connect.<\/em><\/em><\/p>\n","protected":false},"excerpt":{"rendered":"The English High Court in Contour Global v. Kosovo dismissed a s. 68 challenge to an ICC award, affirming the high bar for proving serious irregularity and substantial injustice.<\/p>\n","protected":false},"author":4,"featured_media":283088,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jnews-multi-image_gallery":[],"jnews_single_post":{"subtitle":"","format":"standard","video":"","gallery":"","source_name":"","source_url":"","via_name":"","via_url":"","override_template":"0","override":[{"template":"custom","single_blog_custom":"274736","parallax":"1","fullscreen":"1","layout":"right-sidebar","sidebar":"author","second_sidebar":"default-sidebar","sticky_sidebar":"1","share_position":"hide","share_float_style":"share-monocrhome","show_share_counter":"0","show_view_counter":"0","show_featured":"1","show_post_meta":"1","show_post_author":"0","show_post_author_image":"0","show_post_date":"1","post_date_format":"default","post_date_format_custom":"Y\/m\/d","show_post_category":"0","show_post_reading_time":"0","post_reading_time_wpm":"300","show_zoom_button":"0","zoom_button_out_step":"2","zoom_button_in_step":"3","show_post_tag":"0","show_prev_next_post":"0","show_popup_post":"0","number_popup_post":"1","show_author_box":"0","show_post_related":"0","show_inline_post_related":"0"}],"override_image_size":"0","image_override":[{"single_post_thumbnail_size":"crop-500","single_post_gallery_size":"crop-500"}],"trending_post":"0","trending_post_position":"meta","trending_post_label":"Trending","sponsored_post":"0","sponsored_post_label":"Sponsored by","sponsored_post_name":"","sponsored_post_url":"","sponsored_post_logo_enable":"0","sponsored_post_logo":"","sponsored_post_desc":"","disable_ad":"0"},"jnews_primary_category":{"id":"168","hide":""},"jnews_social_meta":{"fb_title":"English High Court Dismisses S. 68 Challenge to ICC Award Based on Tribunal\u2019s Procedural Orders","fb_description":"The English High Court in Contour Global v. 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The s.68 challenge related to the majority of the Tribunal\u2019s decision on quantum (the Majority<\/strong>). GOK<\/a> maintained that CKL had failed to substantiate any of the development costs it claimed, despite CKL adducing a series of quarterly summaries and invoices. <\/p>\n\n\n\n Following the hearing, the Tribunal issued a procedural order providing that:<\/p>\n\n\n\n \u201cThe Tribunal has not decided issues of liability and may not reach damages issues [sic.]. Should it do so, however, the Tribunal considers that analysis and organisation of the existing record regarding [CKL\u2019s] development costs, and the costs of GOK studies is not sufficiently complete, and it may decide to appoint an expert to investigate and report on those matters pursuant to Article 25(3).\u201d<\/p>\n\n\n\n The Tribunal reiterated this point in a subsequent procedural order (collectively, the Procedural Orders<\/strong>).<\/p>\n\n\n\n In its final award, the Majority awarded the development costs to CKL without appointing an expert (the Award<\/strong><\/a>). On quantum, the Majority found that the quarterly summaries and invoices showed an \u201cindicia of regularity\u201d sufficient to substantiate the development costs. <\/p>\n\n\n\n Dissatisfied with the outcome, GOK<\/a> challenged the Award. It alleged that the Procedural Orders created a \u201creasonable expectation\u201d that the evidence adduced by CKL was insufficient. According to GOK, this meant that the Tribunal should have:<\/p>\n\n\n\n The Majority did none of these things. <\/p>\n\n\n\n GOK<\/a> also argued that the Award contradicted the Tribunal\u2019s prima facie evidential findings as set out in the Procedural Orders. The Majority did not provide an explanation for its apparent change in position, nor did it give GOK an opportunity to make further submissions. GOK alleged that the Majority had therefore failed in its duty to act fairly and impartially under s. 33(1)(a) of the Arbitration Act. This, GOK argued, constituted a serious irregularity under s. 68(2)(a) of the Arbitration Act.<\/p>\n\n\n\n In the first instance, the High Court set out the applicable principles for a s. 68(2)(a) challenge which are well-established and were not disputed. To succeed, the applicant must prove that the tribunal\u2019s failure to act fairly and impartially:<\/p>\n\n\n\n This test imposes a high threshold. It reflects a legislative aim to minimise curial intervention, such that relief under s. 68 will only be granted where the tribunal\u2019s conduct is \u201cso far removed from what could reasonably be expected from the arbitral process that justice calls out for it to be corrected\u201d. Moreover, the court will generally grant a good deal of latitude to a tribunal in how it conducts an arbitration and will be slow to find that its conduct amounts to a breach of its due process duties under s. 33.<\/p>\n\n\n\n English courts also tend to construe arbitral awards and procedural orders in a reasonable and commercial way, in light of \u201cwhat a reasonable person, reading that paragraph in its relevant context, would have concluded the Tribunal was saying\u201d. This aligns with the courts\u2019 default preference not to approach awards \u201cwith a meticulous legal eye endeavouring to pick holes, inconsistencies, and faults\u201d.<\/p>\n\n\n\n Applying these principles, the High Court found that the Procedural Orders did not suggest that the Tribunal had predisposed of CKL\u2019s quantum case. The reference to the existing record \u201cnot being sufficiently complete\u201d simply acknowledged a comment made by the dissenting arbitrator during the hearing that CKL had left the Tribunal to make its own assessment of the evidence. This comment led to the suggestion that the Tribunal might consider appointing an expert to assist it with that analysis. There was nothing in the Procedural Orders capable of generating a \u201creasonable expectation\u201d that the Tribunal should not determine the quantum issue without further evidence or submissions.<\/p>\n\n\n\n The High Court also rejected GOK<\/a>\u2019s argument that there were only three options available to the Tribunal due to its (alleged) findings in the Procedural Orders. To do so would put the horse before the cart, by dismissing CKL\u2019s case on quantum before properly considering it. Nor did the Procedural Orders impair the Tribunal\u2019s ability to assess the evidence provided by CKL independently. Rather, the Tribunal only alluded to the possibility of appointing an expert accountant to assist it with its analysis. The Tribunal was perfectly entitled to render the Award without doing so. <\/p>\n\n\n\n It was therefore \u201cnext to impossible\u201d for the High Court to conclude that an \u201cenormously experienced international Arbitral Tribunal\u201d had predetermined the entirety of CKL\u2019s quantum case based on a single paragraph in a procedural order. If this had been the Tribunal\u2019s intention, then it would have said so in an award.<\/p>\n\n\n\n Indeed, to read the Procedural Orders in the way suggested by GOK<\/a> would go against the \u201creasonable and commercial\u201d construction of arbitral awards preferred by the courts. GOK\u2019s \u201cafter-the-event\u201d position relied on \u201ctechnical inconsistencies and faults precisely as [the] case law warns against\u201d. In reality, the Majority\u2019s conduct was not \u201cso far removed from what could reasonably be expected\u201d in the ordinary course.<\/p>\n\n\n\n Even though no serious irregularity was found, the High Court also made some obiter observations about the \u201csubstantial injustice\u201d test. To establish substantial injustice, GOK<\/a> needed to show that \u201chad the Tribunal acted as [GOK] contends it should have, the outcome might well have been different\u201d. It is not a requirement to show that the result would necessarily (or even probably) have been different.<\/p>\n\n\n\n On this issue, the High Court found that GOK had made no attempt (whether by adducing its own expert report or otherwise) to show the court that it would have advanced new evidence or made further submissions discrediting CKL\u2019s quantum case had it been given the opportunity to do so. Without any new evidence, it was \u201centirely unreal\u201d that the Tribunal would have dismissed CKL\u2019s claim had it asked the parties to make further submissions.<\/p>\n\n\n\n This decision serves as a helpful reminder of the high threshold that English law imposes on parties seeking to bring a s. 68 challenge. Although the language in the Procedural Orders appeared to indicate (at least at face value) that the Tribunal considered the evidentiary record on the quantum issue to be insufficient, the High Court chose not to delve into the procedural minutiae of the underlying arbitration. Instead, it focused on interpreting the actions of the Tribunal in a pragmatic way.<\/p>\n\n\n\n This, in turn, reflects a broader principle. In striving to uphold arbitral awards, the courts will seek to afford tribunals some latitude. Section 68 merely functions as a \u201clongstop in extreme cases\u201d and cannot be used to \u201cappeal\u201d an award simply because a party is dissatisfied with the outcome.<\/p>\n\n\n\n The High Court also touched on the type of evidence required to satisfy the \u201csubstantial injustice\u201d test. In principle, the applicant must show the court that:<\/p>\n\n\n\n If the outcome of the arbitration would have been the same regardless of any irregularity, then no substantial injustice would have occurred.<\/p>\n\n\n\n ABOUT THE AUTHORS<\/strong><\/p>\n\n\n\n Sze Hian Ng<\/strong><\/a> is an associate focussing on international arbitration. His experience covers international commercial and investment treaty arbitrations under LCIA<\/a>, HKIAC<\/a>, SIAC<\/a>, and ICSID<\/a> Rules. He has also assisted with enforcement and setting aside proceedings before the English and Singapore courts.<\/p>\n\n\n\n Luke Adams<\/strong><\/a> is an associate in the London International Arbitration team at A&O Shearman<\/strong><\/a>.<\/strong> He advises on international commercial and investment treaty arbitrations under the rules of various institutions (including the LCIA<\/a>, HKIAC<\/a>, and SIAC<\/a>).<\/p>\n\n\n\n *The views and opinions expressed by authors are theirs and do not necessarily reflect those of their organizations, employers, or Daily Jus, Jus Mundi, or Jus Connect.<\/em><\/em><\/p>\n","protected":false},"excerpt":{"rendered":" The English High Court in Contour Global v. Kosovo dismissed a s. 68 challenge to an ICC award, affirming the high bar for proving serious irregularity and substantial injustice.<\/p>\n","protected":false},"author":4,"featured_media":283088,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jnews-multi-image_gallery":[],"jnews_single_post":{"subtitle":"","format":"standard","video":"","gallery":"","source_name":"","source_url":"","via_name":"","via_url":"","override_template":"0","override":[{"template":"custom","single_blog_custom":"274736","parallax":"1","fullscreen":"1","layout":"right-sidebar","sidebar":"author","second_sidebar":"default-sidebar","sticky_sidebar":"1","share_position":"hide","share_float_style":"share-monocrhome","show_share_counter":"0","show_view_counter":"0","show_featured":"1","show_post_meta":"1","show_post_author":"0","show_post_author_image":"0","show_post_date":"1","post_date_format":"default","post_date_format_custom":"Y\/m\/d","show_post_category":"0","show_post_reading_time":"0","post_reading_time_wpm":"300","show_zoom_button":"0","zoom_button_out_step":"2","zoom_button_in_step":"3","show_post_tag":"0","show_prev_next_post":"0","show_popup_post":"0","number_popup_post":"1","show_author_box":"0","show_post_related":"0","show_inline_post_related":"0"}],"override_image_size":"0","image_override":[{"single_post_thumbnail_size":"crop-500","single_post_gallery_size":"crop-500"}],"trending_post":"0","trending_post_position":"meta","trending_post_label":"Trending","sponsored_post":"0","sponsored_post_label":"Sponsored by","sponsored_post_name":"","sponsored_post_url":"","sponsored_post_logo_enable":"0","sponsored_post_logo":"","sponsored_post_desc":"","disable_ad":"0"},"jnews_primary_category":{"id":"168","hide":""},"jnews_social_meta":{"fb_title":"English High Court Dismisses S. 68 Challenge to ICC Award Based on Tribunal\u2019s Procedural Orders","fb_description":"The English High Court in Contour Global v. 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\n
No Serious Irregularity<\/strong><\/h2>\n\n\n\n
\n
No Substantial Injustice<\/strong><\/h2>\n\n\n\n
Commentary<\/strong><\/h2>\n\n\n\n
\n
\n\n\n\n
\n\n\n<\/figure>\n<\/div>\n\n\n