England and Wales Court of Appeal (Civil Division) Decisions

IN THE SUPREME COURT OF JUDICATURE
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT
QUEEN'S BENCH DIVISION
(TECHNOLOGY AND CONSTRUCTION COURT)
(HIS HONOUR JUDGE ANTHONY THORNTON QC)

		Royal Courts of Justice Strand London, WC2A 2LL
		Wednesday, 29 October 2003

1. LORD JUSTICE MUMMERY: Lord Justice Tuckey will give the first judgment.
2. LORD JUSTICE TUCKEY: This is a renewed application for permission to appeal from part of the decision of His Honour Judge Thornton QC, made on an appeal to the Technology and Construction Court under section 69 of the Arbitration Act 1996. That section gives the court jurisdiction to hear an appeal on a question of law arising out of an arbitration award.
3. The complaint by the claimants in the arbitration, Wright & Fuller Ltd, is that the judge redefined the questions of law which he had to decide and decided them on the basis of findings of fact not made by the arbitrator and arguments not advanced to him on the appeal. It is therefore contended that the judge acted in excess of his jurisdiction.
4. In the arbitration, Wright & Fuller ("the applicant") claimed about £75,000 for work which they had carried out to the respondent's nursing home under what they contended was a valid final certificate issued under clause 30 of the JCT contract conditions. The respondents disputed the validity of the certificate. The arbitrator, with the agreement of the parties, decided preliminary issues as to whether the certificate was validly issued in accordance with clause 30.8 (issue 1) and whether it was a final certificate for the purpose of clause 30.9 (issue 2). By his award, the arbitrator answered both questions in favour of the applicant.
5. The contract gave either party the right to appeal on questions of law. The respondents, now acting in person, did so. Their arbitration application did not spell out the questions of law for the court, although they were obviously challenging the arbitrator's conclusions on both issues.
6. The appeal was first argued before the judge for half a day. The respondents appeared in person and the applicant was represented by counsel, Mr Darryl Royce. Following the hearing the judge produced a draft judgment answering both questions in favour of the respondents, but inviting the parties to "address further argument as to any error of law procedure or fact or any procedural inaccuracies at a further hearing" which he fixed.
7. At that hearing Mr Royce objected that, in support of his conclusion, the judge had given three reasons which had not been the subject of argument before him, that he had made findings of fact which had not been made by the arbitrator and that he had widened the ambit of the appeal. In so doing he had acted in excess of the jurisdiction conferred on him by section 69 of the 1996 Act. During that hearing, which lasted a day, Mr Royce developed his arguments about excessive jurisdiction but chose not to take the opportunity, which the judge's invitation had obviously given him, to address those parts of the judge's findings on the merits to which he had objected.
8. The judge then produced a revised judgment in which between paragraph 63 and 78 he dealt with Mr Royce's complaint that he had exceeded his jurisdiction. The order drawn up following this hearing was:

"The Questions of Law arising out of the award that are the subject of the appeal brought by the claimants are as follows:

1. Were the arbitrator's answers to the questions on issues 1 and 2 correct in law?

2. If not what are the correct answers to issues 1 and 2?"

The order then answers those questions in favour of the respondents and varies the award accordingly. The applicant's application for permission to appeal the merits of the judge's decision under section 69(8) of the award was adjourned but the judge refused permission to appeal on the grounds his order was made in excess of jurisdiction. No appeal on the merits of a first instance judge's decision lies to this court without his leave, which is only to be given if he considers that the question is of general importance or is one which this court should consider for some other special reason: see section 69(8) of the Act and this court's decision in Henry Boot Construction v Malmaison Hotel (Manchester) Ltd [2001] QB 388. In North Range Shipping Corpn v Seatrans Shipping Corpn, 'The Western Triumph' [2002] 1WLR 2397; [2002] EWCA Civ 405, this court had to consider whether section 69(8) was a bar to appeal where the complaint was one of procedural unfairness by the judge. In paragraphs 12 to 14 of the judgment, we decided that it was not. In an exceptional case, this court had the jurisdiction to set aside a decision made under section 69 where there was something akin to misconduct by the judge. The route into that conclusion was Article 6 of the Convention.

9. Mr Royce sought to put the matter in another more complicated way in his skeleton argument. But, I think that the way in which we dealt with the matter in The Western Triumph deals adequately with those cases where there has been something akin to misconduct; some serious procedural unfairness.
10. Is this such a case? I am quite satisfied that it is not. The broad questions of law which the judge had to decide had always been defined as issues 1 and 2. It was these questions and no others which the judge answered in the order which he made. In answering these questions, the judge was not confined to the parties' submissions but was able to look at all the material which was before the arbitrator and before him by agreement of both parties. No evidence had been called before the arbitrator, so the judge was in exactly the same position as the arbitrator in deciding the issues of law having regard to all the surrounding circumstances which were before him. Such findings of fact as the judge made were not, as Mr Royce accepted, contrary to any findings made by the arbitrator. The judge obviously made such additional findings as he felt were necessary in order to answer fully the questions of law posed for him. It is not suggested that the material before the judge precluded him from making such findings. They were obviously open to him.
11. As the judge explained, his task was made more difficult by the fact that the issues before the arbitrator had been broadly defined, no leave to appeal to the court was required and the respondents were acting in person. In paragraphs 74 and 75 of his judgment the judge said:

"74. In answering the questions of law that arise on this appeal, I must apply the normal principles applicable to the construction of commercial contracts and documents, particularly since the Conditions [the JCT conditions] themselves require that the Conditions should be read as a whole. I must therefore undertake my own construction of all relevant Conditions and the disputed certificate and cannot rely on any failure to refer to particular relevant Conditions by either party. I must also take into account any assistance to be derived from the factual matrix known to both parties at the date of the contract or, in the case of the certificate, at the date it was issued.

75. I must undertake this exercise as part of my task of answering the same questions of law that the arbitrator was asked to answer, namely whether the certificate complied with clauses 30.8 and 30.9 of the Conditions."

12. I do not think this approach can be faulted. It certainly does not come within measurable distance of the type of procedural unfairness which would justify intervention by this court.
13. For those reasons, I would refuse permission to appeal.
14. LORD JUSTICE MUMMERY: I agree.

Order: Permission to appeal refused.