Is it possible to appeal an arbitral award?

Under the old Commercial Arbitration legislation an appeal was available as a right on, amongst other things, an error of law.

Under the new UNCITRAL Commercial Arbitration framework an appeal is now only available on very limited grounds.

In that regard see by way of example Commercial Arbitration Act 2010 (NSW) s16(9), Commercial Arbitration Act (NSW) 2010 s34 and Commercial Arbitration Act 2010 (NSW) s34A.

For a leading case under UNCITRAL Commercial Arbitration framework in relation to an appeal with respect to jurisdiction please see

• April 1, 2011 - Larkden Pty Limited -v- Lloyd Energy Systems Pty Limited [2011] NSWSC 268

Please note that our Mr White was the arbitrator in that dispute.

• Commercial Arbitration Act 2010 (NSW)
  • s16 Competence of arbitral tribunal to rule on its jurisdiction
  • s17H Recognition and enforcement
  • s17I Grounds for refusing recognition or enforcement
  • s35 Recognition and enforcement
  • s36 Grounds for refusing recognition or enforcement
• Arbitration Act 1996 (NZ), Second Schedule, s5(1)(c)

• Blanalko Pty Ltd v Lysaght Building Solutions Pty Ltd¹⁾

• Amasya Enterprises Pty Ltd v Asta Developments (Aust) Pty Ltd ²⁾

• Cameron Australasia Pty Ltd v AED Oil Ltd ³⁾
• Colin Joss & Co Pty Ltd v Cube Furniture Pty Ltd ⁴⁾
• Novawest Contracting v Brimbank City Council ⁵⁾

• Re 700 Form Holdings Pty Ltd ⁶⁾
• Seagate Technology LLC v Western Digital Corporation, et al ⁷⁾

• Limin James Chen & Anor v Kevin McNamara & Son Pty Ltd & Anor ⁸⁾
• MRI Trading AG v Erdenet Mining Corporation LLC ⁹⁾
• Ringwood Agricultural Company Pty Ltd v Grain Link (NSW) Pty Limited¹⁰⁾

• Doohan v North Shore Transport Pty Ltd ¹¹⁾
• Sugar Australia Pty Limited v Mackay Sugar Ltd¹²⁾
• State of Victoria v Grawin Pty Ltd¹³⁾
• VIH Aviation Group Ltd. v. CHC Helicopter LLC¹⁴⁾
• Dunnes Stores -v- Holtgen Ltd¹⁵⁾
• Ashjal Pty Ltd v Elders Toepfer Grain Pty Ltd¹⁶⁾
  • Contract - whether written contracts between the parties contains an implied term amounting to an agreement under s34A(1) of the Commercial Arbitration Act 2010 (NSW) - implied term contended for does not meet established tests
• Ashjal Pty Ltd v Alfred Toepfer International (Australia) Pty Ltd¹⁷⁾
  • The enactment of s5, s34, s35 and s36 of the Commercial Arbitration Act 2010 was not beyond the legislative power of the New South Wales Parliament

• December 2011, 16 - Larkden Pty Limited -v- Lloyd Energy Systems Pty Limited¹⁸⁾
  • Our Mr White was the arbitrator in this matter.
  • Commercial Arbitration Act s33B(1)
  • His costs awards of approximately $1m were upheld.
• November 2, 1011 - Larkden Pty Limited -v- Lloyd Energy Systems Pty Limited ¹⁹⁾
  • Our Mr White was the arbitrator in this matter.
  • Commercial Arbitration Act 2010 (NSW), ss 35 and 36 - Award by arbitrator declaring a constructive trust, ordering specific performance of a Licencing Agreement and requiring the defendant to take steps - recognition and enforcement opposed on the basis that part of the Award dealt with the dispute not contemplated by or falling within the terms of arbitration and that recognition and enforcement of parts of the Award would be contrary to the public policy of this State - orders for recognition and enforcement made
  • For third party commentary about this leading decision please visit the following links:
    • Mr Warrick Rothnie, Leading IP/IT Counsel (formerly partner Mallesons Stephens Jaques)
• October 5, 2011 - Larkden Pty Limited -v- Lloyd Energy Systems Pty Limited ²⁰⁾
  • Our Mr White was the arbitrator in this matter.
  • Corporations Act 2001 (Cth), s440D - an application for leave to bring and continue proceedings against a company in voluntary administration for recognition and enforcement of an arbitral award pursuant to Commercial Arbitration Act 2010 (NSW) s35 - nature of discretion to be exercised - relevant circumstances - leave granted
• Yesodei Hatorah College Inc v Trustees of the Elwood Talmud Torah Congregation ²¹⁾
• Westport Insurance Corporation v Gordian Runoff Limited²²⁾ French CJ, Gummow, Crennan and Bell JJ
• Perth Freightlines Pty Ltd & Ors v BM2008 Pty Ltd (in liq) & Ors ²³⁾
  • This is an application for leave to appeal out of time against a decision of Hargrave J enforcing an arbitral award pursuant to s 33 of the Commercial Arbitration Act 1984.
  • The applicants sought leave to appeal the interim and final awards, whilst the respondents sought leave to enforce the final award pursuant to s 33 of the Commercial Arbitration Act 1984, which provides as follows: An award made under an arbitration agreement may, by leave of the Court, be enforced in the same manner as a judgment or order of the Court to the same effect, and where leave is so given, judgment may be entered in terms of the award.
  • The matter was heard and determined by Hargrave J on 18 November 2009 (see below).
  • His Honour refused the application for leave to appeal and granted the respondents leave to enforce the final award.
  • There is no basis for an order granting the applicants an extension of time within which to appeal against Hargrave J’s decision. I would refuse the application.

• Cargill International SA v Peabody Australia Mining Ltd²⁴⁾
• Leveraged Equities Pty Ltd v Huxley ²⁵⁾
  • In this case the Court found that the margin lending agreements which provided that the parties
  • “will first try to settle any dispute they have by arbitration”
  • did not provide for an arbitration that would be a mere dress rehearsal before litigation.
• Telstraclear Ltd v Kordia Ltd²⁶⁾
  • This case looked at some of the factors relevant to enforcing a domestic arbitration in New Zealand.

• Perth Freightlines Pty Ltd & Ors v BM2008 Pty Ltd & Ors ²⁷⁾, Hargrave J (upheld on appeal)
  • The applicable law is not in doubt.
  • Section 38(4) of the Act provides that an appeal against an arbitral award may only be made with consent or with the leave of this Court.
  • Under sub-s (5) this Court must not grant leave unless it considers that two matters have been established:
    • that, having regard to all of the circumstances, the determination of the question of law concerned could substantially affect the rights of one or more parties to the arbitration agreement; and
    • that there is a manifest error of law on the face of the award.
  • It is clear that leave to appeal will only be granted in respect of an error of law which appears on the face of the relevant award.
  • The relevant principles have been discussed in a number of cases and there is no dispute about them. In Anaconda Operations v. Fluor Australia Pty Ltd,[1] Dodds-Streeton J, as she then was, summarised the relevant principles in the following way:
    • It is well established that the legitimate role of the Court in applications for leave to appeal under s.38(5) of the Act is very circumscribed.
    • The legislation restricts the court's jurisdiction to review arbitral awards in recognition of the importance of speedy finality in that context.
    • Nevertheless, the power to review is enlivened by an obvious departure from settled principles of law.
    • The basic principles relevant to the determination of an application for leave to appeal pursuant to s.38(5) of the Act were conveniently summarised by Debelle J in Leighton Contractors Pty Ltd v South Australian Superannuation Fund Investment Trust as follows -
      • there is no appeal from an arbitrator on a question of fact;
      • while s.38 provides that an appeal shall be from the award of an arbitrator on a question of law, leave must nevertheless be obtained unless both parties consent to the appeal;
      • leave will only be granted in circumstances prescribed in s.38(5);
      • the applicant for leave must satisfy both para(a) and para(b) of 38(5);
      • the epithet `manifest' in the expression `manifest error of law' is used to indicate an error which is evident or obvious rather than one which is arguable;
      • if the court determines that there is no manifest error of law, an application based on this ground fails;
      • if the court is satisfied that a manifest error of law exists, a question arises whether the court should, in the exercise of its discretion, grant leave; and
      • assuming that there is not a manifest error of law on the face of the award, it may be argued that there is strong evidence that the arbitrator made an error of law and the determination of the question may add, or may be likely to add, substantially to the certainty of commercial law.
      • This requirement indicates that the question should be one of wider and greater importance than, for example, the construction of a one-off clause in the context of the particular agreement between the parties.
  • Notwithstanding that there are arguable technical breaches of the warranties, leave to appeal should not be given unless a finding of breach could substantially affect the rights of the parties.
  • In my view, that is not the case.
  • In his interim award, the arbitrator made it plain that, even if a breach of warranty was established, he would nevertheless have found in favour of the vendor.
  • This is because the damages case put forward by the purchaser was not established on any view of the facts.
  • In that regard, the arbitrator said in paragraph 78 of the interim award, in my view correctly, that:
    • The loss that would naturally flow, and this is a contractual claim, from the fact that money had to be injected into the business for a period of months, would be the cost of obtaining the added finance over the relevant period.
    • Despite the arbitrator making reference to this as the most likely loss early in the arbitration, at no stage was any exercise carried out to demonstrate the cost of providing the extra income.
    • On any view, it would not be a large sum of money.
    • But a greater loss is claimed.
    • Reasons were then given by the arbitrator as to why the greater loss claimed was not proved.
    • There is nothing evidently or obviously wrong about those reasons which, in any event, involve wholly or substantially questions of fact and not law.
    • The purchaser elected to pursue a particular damages claim in the face of strong indications by the arbitrator that the natural loss flowing from any breach of warranty was of a more limited amount.
    • The arbitrator found, as a matter of fact, that no basis of damage was proved, including as to the more limited amount.
    • In these circumstances, notwithstanding my view that there were arguable (albeit technical) breaches of the warranties, leave to appeal should be refused, and the defendants should be given leave to enforce the final award.

• Gold and Resource Developments (NZ) Ltd v Doug Hood Ltd²⁸⁾

• Kidman v Commonwealth²⁹⁾ Isaacs J.
  • Lord Dunedin, for the Judicial Committee, in Champsey Bhara & Co. v. Jivraj Balloo Spinning and Weaving Co.³⁰⁾ said:
    • The law on the subject has never been more clearly stated than by Williams J. in the case of Hodgkinson v. Fernier ³¹⁾
      • The law has for many years been settled, and remains so at this day, that, where a cause or matters in difference are referred to an arbitrator, whether a lawyer or a layman, he is constituted the sole and final judge of all questions both of law and of fact. …
  • The only exceptions to that rule, are, cases where the award is the result of corruption or fraud, and one other, which though it is to be regretted, is now, I think, firmly established, namely, where the question of law necessarily arises on the face of the award, or upon some paper accompanying and forming part of the award.
  • Though the propriety of this latter may very well be doubted, I think it may be considered as established.
  • This view has been adhered to in many subsequent cases, and in particular in the House of Lords in British Westinghouse Co. v. Underground Electric Railways Co.5 ³²⁾