Aden Refinery Company Ltd v Ugland Management Company Ltd
| Jurisdiction | England & Wales |
| Judge | THE MASTER OF THE ROLLS,LORD JUSTICE MUSTILL,LORD JUSTICE NOURSE |
| Judgment Date | 31 July 1986 |
| Judgment citation (vLex) | [1986] EWCA Civ J0731-4 |
| Docket Number | 86/0709 |
| Court | Court of Appeal (Civil Division) |
| Date | 31 July 1986 |
[1986] EWCA Civ J0731-4
The Master of the Rolls
(Sir John Donaldson)
Lord Justice Mustill
and
Lord Justice Nourse
86/0709
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION (COMMERCIAL COURT)
(MR. JUSTICE LEGGATT)
Royal Courts of Justice.
MR. BERNARD EDER (instructed by Messrs. Holman Fenwick & Willan) appeared on behalf of the Applicants.
MR. D. KENDRICK (instructed by Messrs. Sinclair Roche & Temperley) appeared on behalf of the Respondents.
In July 1978 the Commercial Court Committee published a report (Cmd. 7284) recommending radical reforms in the law relating to arbitration. These recommendations included the abolition of the right of appeal by way of an award in the form of a special case, which had spawned a vast number of appeals and wholly unacceptable delays in resolving commercial disputes, and of the power to set aside an award for error of fact or law upon its face. Instead it recommended a system of judicial review based upon reasoned awards, such review being subject to first obtaining the leave of the High Court and any appeal from the High Court to the Court of Appeal being subject to further restrictions. Thus the need for speed and finality, which is so essential in commerce and which arbitration is traditionally intended to provide, could be married to the equally essential continued development of English commercial law. Parliament approved in principle and the result is the Arbitration Act 1979.
With some prescience the committee foresaw that there would be a need for successive amendments to the law of arbitration. The rules and procedures governing arbitration are a living thing which inevitably require statutory amendment from time to time in the light of experience and changing conditions. Accordingly the committee recommended the establishment of an "Arbitration Rules Committee" with a view to relieving Parliament of the need frequently to consider detailed amendments to the current Arbitration Acts. Unfortunately this recommendation was rejected on the grounds that it was constitutionally improper for subordinate legislation to be used to amend primary legislation. If this is indeed a constitutional principle, the presence of the Hallmarking Act 1973 on the statute book is somewhat surprising. This empowers the Secretary of State by statutory instrument to apply the Act to metals other than gold, silver and platinum and in so doing to include provisions "applying, extending, excluding or amending, or repealing or revoking, with or without savings, any provisions of this Act or an instrument under this Act." An analogous power in the 1979 Act might have obviated the need for a great deal of judicial effort, regarded by some as more legislative than adjudicative, and the idea of a specialist body with legislative powers seems worth reviving.
The present appeal does not call for legislative effort, but it does involve a close look both at the 1979 Act, as amended by section 148 (2) of the Supreme Court Act 1981, and at the guidance given by the House of Lords in the ( Pioneer Shipping Ltd. v. B.T.P. Tioxide Ltd. Nema [1982] A.C. 725 and in the Antaios ( Antaios Compania Naviera S.A. v. Salen Rederierna A.B.) [1985] A.C. 191.
The background is concisely stated in the introductory paragraphs to a reasoned award dated the 17th May, 1985 by three very well known and vastly experienced maritime arbitrators, namely Mr. Basil Eckersley, of counsel, Mr. Donald Davies and Mr. Michael Mabbs:
"1. In this case the Claimants ('Owners') claim the sum of U.S. 70,444.44 as demurrage or alternatively as damages for breach of charterparty. There is no dispute about the figure, as such, but the Respondents ('Charterers') deny that they are under any liability at all.
2. The Owners' contention is that their claim for demurrage is plainly established by the principles enunciated by the House of Lords in The 'Laura Prima' (1982) 1 Lloyd's Rep. 1 (a case decided on the Exxonvoy form which is in all material respects identical to the present Asbatankvoy form). That contention is squarely challenged by the Charterers; they say that the Owners seek to extract from the speech of Lord Roskill (which set out the unanimous view of their Lordships) a proposition of wider generality than, on a true reading, is jsutified.
3. In a nutshell, the issue between the parties is whether, in a case where a vessel is prevented from berthing following her arrival at the loading port as a result of adverse weather conditions, the Charterers are entitled to the benefit of the protection afforded by the last sentence of clause 6 of the charterparty, viz.'…where delay is caused to the vessel getting into berth after giving notice of readiness for any reason over which Charterer has no control, such delay shall not count as used laytime.'
4. That issue is one of considerable practical importance and it raises a question upon which it is well-known that there is a division of view between London maritime arbitrators—a division which has manifested itself in the instant case. It is highly desirable that the question should be submitted to judicial decision and this dispute would appear to offer an ideal opportunity for the position to be resolved by such decision."
I would add that the reasons of the majority (Messrs. Eckersley and Mabbs) extended to nine pages of close reasoning and the dissenting reasons of Mr. Davies to 18 pages, which were no less closely reasoned.
With this encouragement, the charterers, who had been held liable to the owners, applied to Mr. Justice Leggatt for leave to appeal to the High Court on the question of law arising out of the award. Such leave is required under section 1 (3) of the 1979 Act and the only statutory guidance as to the circumstances in which it should be granted is to be found in section 1 (4), which provides that "The High Court shall not grant leave under subsection (3) (b) above unless it considers that, having regard to all the circumstances, the determination of the question of law concerned could substantially affect the rights of one or more of the parties to the arbitration agreement." This subsection is, as is apparent, intended to prevent appeals on academic questions of law, which were a feature of the old special case procedure. It is not suggested that the subsection had any application in the circumstances of the instant case. If the charterers were correct in their contentions, their rights would be affected to the tune of U.S. 70,000, not to mention further sums in respect of interest and costs.
Mr. Justice Leggatt refused the application, saying: "Despite Mr. Eder's usual persuasiveness and skill in attempting to convince me that there is a strong prima facie case that the majority of the arbitrators were wrong, I am satisfied that there is a strong prima facie case that the arbitrators were right and accordingly I dismiss this application."
The charterers wish to appeal to this court against that refusal. Section 1(6A) of the 1979 Act provides that, "Unless the High Court gives leave, no appeal shall lie to the Court of Appeal from a decision of the High Court - (a) to grant or refuse leave under subsection (3) (b)…" They therefore applied for such leave, but were refused, Mr. Justice Leggatt saying:
"In accordance with the principles laid down in the ANTAIOS I feel compelled to refuse leave to appeal."
The charterers now seek to appeal to this court without leave from (a) the refusal of leave to appeal to the High Court under section 1 (3), and (b) the refusal of leave to appeal to this court against that refusal.
Mr. Eder accepts, as he must, that prima facie section 1 (6A) of the 1979 Act deprives this court of jurisdiction to entertain any appeal against the refusal of leave to appeal to the High Court under section 1 (3) without the leave of that court. However, he submits that the apparent width of the ouster of our jurisdiction is subject to a concealed exception which comes into play if the learned judge failed to exercise his discretion judicially.
When it comes to the appeal from the learned judge's decision refusing leave to appeal to this court, Mr. Eder is confronted not with a statutory ouster of jurisdiction, but with a decision of the House of Lords in Lane v. Esdaile [1891] A.C. 210. There the House of Lords declined jurisdiction when Mr. Lane sought in December 1888 to appeal against a decision of the Court of Appeal refusing special leave to appeal out of time against a judgment of Mr. Justice Kay given in July 1885. The relevant rule requiring such special leave was Order 58 rule 15 of the Rules of the Supreme Court which read: "No appeal to the Court of Appeal from any interlocutory order…shall, except by special leave of the Court of Appeal, be brought after the expiration of twenty-one days, and no other appeal shall, except by such leave, be brought after the expiration of one year…"
Lord Halsbury L.C. said at page 211:
"But when I look not only at the language used, but at the substance and meaning of the provision, it seems to me that to give an appeal in this case would defeat the whole object and purview of the order or rule itself, because it is obvious that what was there intended by the Legislature was that there should be in some form or other a power to stop an appeal—that there should not be an appeal unless some particular body pointed out by the statute (I will see in a moment what that body is), should permit that an appeal should be given. Now just let us...
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