page_title: Arbitration Act 1979
section_title: Section 1
hierarchical_section_title: Arbitration Act 1979 / Act / Section 1
caption_attribution_description: The neo-medieval pile of the Royal Courts of Justice on G.E. Street, The Strand, London.royal courts of justice
context_page_description: The Arbitration Act 1979 was an Act of the Parliament of the United Kingdom that reformed arbitration law in England and Wales. Prior to 1979, arbitration law was based on the Arbitration Act 1950, which allowed use of the "Case Stated" procedure and other methods of judicial intervention, which marked English arbitration law as significantly different from that of other jurisdictions. The prior law significantly increased the cost and time required for arbitration, which made England an unpopular jurisdiction to conduct such negotiations in. As a result, while London maintained its traditional position as a centre for arbitration in insurance, admiralty and commodities trading, it failed to attract more modern forms of trade. Following pressure from industry groups, the Lord Chancellor introduced the Arbitration Bill into Parliament, having it passed hours before the dissolution of James Callaghan's government. It was given the Royal Assent on 4 April 1979, and commenced working on 1 August 1979.
context_section_description: The primary reforms are found in Section 1 of the Act. Section 1(1) repeals Section 21 of the 1950 Act, abolishing the Case Stated procedure in arbitration matters, and states that the courts cannot set aside a decision based on an error in law or fact that is blatantly obvious, effectively repealing Section 22(1). Instead, Sections 1(2) and 1(3) provide that an appeal may be made "on any question of law arising out of an award made on an arbitration agreement", if either the High Court agrees the appeal is valid, or if both parties to the arbitration request it. In Petraco (Bermuda) Ltd v Petromed International, the Court of Appeal was asked to explain what guidelines should be applied by a High Court judge when deciding whether or not to grant an appeal. The High Court had refused leave to appeal, because a point was raised which had not been mentioned during arbitration. Staughton LJ, with the rest of the Court in agreement, explained that:
  the judge should give such weight as he thinks fit to the failure to argue the point before the arbitrator. In particular, he should have regard to whether the new point is similar to points that were argued, perhaps a variant of one of those points or a different way of putting it on the one hand, or whether it is a totally new and different point on the other.
  The conditions for leave to appeal are laid out in Section 1(4). No conditions attach to an appeal where all parties consent, but when the permission of the High Court is sought, the judge may only grant leave if he "considers that...the question of law concerned could substantially affect the rights of one or more parties to the arbitration agreement". Under Sections 1(5) and 1(6), the High Court may ask for additional reasons as to why the arbitrator reached the decision that he did, but only if one of the parties gave notice to the arbitrator that reasons would be required, or there was "some special reason why such a notice was not given". In Universal Petroleum Co v Handels und Transport GmbH, the Court of Appeal interpreted the meaning of Sections 1(4) and 1(5). The dispute came from a highly detailed "Schedule of Further Reasons" ordered by the High Court because the judge felt that there was an ambiguous element in the reasons given. The appellate judges found that Section 1(5) required judges to order further reasons only to deal with points of law arising from the award. Material ambiguity was "inadmissible and irrelevant for the purpose of the exercise of any jurisdiction under section 1 of the Act".
  If the High Court refuses to hear an appeal, the case cannot proceed further; similarly, with one exception, once the High Court has heard a case, no decision may be reviewed by the Court of Appeal. The one exception is laid out in Section 1(7), and provides that leave to appeal is only valid if either the High Court or Court of Appeal certifies it as such, and the High Court confirms that the case concerns a point of law which merits consideration. In National Westminster Bank Plc v Arthur Young McClelland Moores & Co (No.1), the Court of Appeal confirmed that, once the High Court has decided not to allow an appeal, the registrar of the Court of Appeal cannot intervene and otherwise validate such a request.
caption: The High Court of Justice, the principal body that deals with arbitration appeals
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