Haven Insurance Company Ltd v Eui Ltd (T/A Elephant Insurance)
| Jurisdiction | England & Wales |
| Judge | Lord Justice Haddon-Cave,Sir Ernest Ryder,Lady Justice Nicola Davies |
| Judgment Date | 08 November 2018 |
| Neutral Citation | [2018] EWCA Civ 2494 |
| Date | 08 November 2018 |
| Court | Court of Appeal (Civil Division) |
| Docket Number | Case No: A3/2018/0397 |
[2018] EWCA Civ 2494
IN THE COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
BUSINESS AND PROPERTY COURTS OF ENGLAND AND WALES
QUEEN'S BENCH DIVISION
COMMERCIAL COURT
MR JUSTICE KNOWLES
[2018] EWHC 143 (QB)
Royal Courts of Justice Strand, London, WC2A 2LL
THE SENIOR PRESIDENT OF TRIBUNALS
Sir Ernest Ryder
Lord Justice Haddon-Cave
and
Lady Justice Nicola Davies
Case No: A3/2018/0397
Mr Andreas Gledhill QC and Mr Alexander Wright (instructed by Flint Bishop LLP) for the Appellant
Mr Sa'ad Hossain QC and Ms Joyce Arnold (instructed by Horwich Farrelly Solicitors) for the Respondent
Hearing date: Tuesday 16 th October 2018
Approved Judgment
Introduction
This appeal concerns an application to extend time for bringing arbitral proceedings under s.12(3)(a) of the Arbitration Act 1996 (“AA 1996”) and the relevant test to be applied.
The Parties
The Appellant (“Haven”) and the Respondent (“Elephant”) are both motor insurers, and members of the Motor Insurers Bureau (“MIB”). MIB is the fund of ‘last resort’ and was established to satisfy claims required to be covered by contracts of insurance pursuant to part VI of the Road Traffic Act 1988.
By virtue of s.33 of the Companies Act 2006, MIB's Articles of Association (“Articles”) have contractual force as between MIB's members. Article 75 of the Articles provides for disputes between members to be resolved in the first instance by a Technical Committee of “ claims managers or persons with similar experience” (see Article 67 below).
The Facts
The following summary of the facts is taken from the Appellant's skeleton argument and is largely common ground.
At a meeting on 13 th February 2015, the Technical Committee determined a dispute between Haven and Elephant regarding who was liable to indemnify the victim of a road traffic accident which occurred on 8 th April 2006. Representatives of both Haven and Elephant were present at the Technical Committee's meeting to argue their respective corners. The matter was resolved against Elephant and in favour of Haven. The details of the dispute and the traffic accident in question are immaterial for the purposes of this appeal.
MIB's Articles provide that a member can appeal a decision of the Technical Committee to an arbitrator, if the member gives written notice of appeal within 30 days of “ being notified of the decision of the Technical Committee” (see Article 75(6)(a) below).
On 30 th April 2015, Elephant gave written notice of appeal against the Technical Committee's said determination. A time-bar dispute arose which is the subject matter of this appeal. Haven contended that Elephant's appeal was out of time because Elephant had been “ notified of the decision of the Technical Committee” in accordance with Article 75 more than 30 days before service of its written notice of appeal, either (a) by being physically present at the 13 th February 2015 meeting, or (b) as the result of a 24 th February 2015 email from MIB's secretariat to Elephant confirming in writing the decisions taken on that earlier date. Elephant contended that its appeal was in time because time for an appeal only ran from 31 st March 2015, being the date at which the final draft minutes (generally referred to as the “final minutes”) of the meeting were released to members of the Technical Committee by MIB's secretariat.
On 4 th November 2015, Christopher Hancock QC was appointed arbitrator, following a reference to the chairman of the Bar Council under Article 75(6)(e) of MIB's Articles. His appointment was without prejudice to Haven's position that he had no substantive jurisdiction to determine an appeal brought out of time, which issue the parties agreed he should decide as a preliminary point.
On 3 rd November 2016, Mr Hancock QC rejected Haven's jurisdictional challenge, holding that Elephant's appeal had been brought within time, because (as Elephant had argued) time for an appeal only ran from the date on which the final draft minutes had been circulated or posted on MIB's secure members' website.
Haven challenged the arbitrator's jurisdiction decision in the High Court under s.67 of AA 1996. Elephant thereafter cross-applied for an order under s.12 of AA 1996 extending time for commencing its arbitration, arguing that in the event the court should rule in Haven's favour on the time bar point, the “ circumstances” were such as to be “ outside the reasonable contemplation of the parties when they agreed the provision in question [ i.e. Article 75], and that it would be just to extend the time” under s.12(3). Elephant relied principally on what was said to be a settled practice by the MIB in calculating time for an Article 75(6)(a) appeal from the date the minutes of the relevant meeting were circulated.
On 31st January 2018, Knowles J handed down judgment on those issues. He allowed Haven's s.67 challenge, finding that Elephant's appeal had been out of time, but granted Elephant's s.12 application for an extension of time and remitted the matter to Mr Hancock QC for substantive determination. It is Knowles J's latter decision on the s.12 point granting Elephant an extension of time which is the subject of this appeal. There is no appeal against his finding that Elephant's appeal was lodged out of time.
Detailed chronology
The detailed chronological facts relevant to Elephant's failure to lodge its appeal in time is as follows.
At 15:15 hours on 19 th February 2015, Mark Armstrong of MIB's secretariat emailed Elephant, purporting to summarise the decisions taken by the Technical Committee at its 13 th February 2015 meeting. Elephant replied questioning the accuracy of that summary, sparking an exchange which culminated in an email from Mr Armstrong to Elephant of 15:59 hours the same day in which he suggested: “… it might be best to await the minutes”.
On 24 th February 2015, Mr Armstrong emailed Elephant again summarising the Technical Committee's decision correctly. As Knowles J held, Elephant's time for appeal ran from this date (see paragraph 26 of his judgment). On 27 th February 2015, Elephant replied to Mr Armstrong, stating: “ we intend to appeal…”. On 18 th March 2015, Elephant emailed Mr Armstrong again, reiterating that it was likely to appeal.
On 26 th March 2015 ( i.e. 30 days from the 24 th February 2015 email), however, selon Knowles J, Elephant's appeal became time-barred because Elephant had failed to lodge an appeal by this time.
At 09:38 hours on 29 th April 2015, Elephant emailed Paul Ryman-Tubb (MIB's Head of Technical) asking him to confirm by when its appeal had to be filed. At 09:44 hours on the same day, Mr Ryman-Tubb sent a non-committal reply: “ You can view Article 75 on our website. If you cannot locate it, I am sure Mark [Armstrong] will be able to assist”. At 09:55 hours, Mr Armstrong (who had been copied-in on that exchange) emailed the text of Article 75(6) to Elephant, followed by this one line comment: “ …the final minutes were released on 31st March 2015”. Elephant finally lodged its appeal on the following day, 30th April 2015.
None of the correspondence summarised above was copied to, or seen at the time by, Haven, whose evidence was that its understanding throughout was that Elephant was not going to appeal, and accordingly, on 26 th March 2015, Haven released its reserve, in the (now established to be correct) belief that time for an appeal had by then expired.
On 30 th April 2015, however, Haven was notified by MIB that Elephant had in fact appealed. Thereafter, on 6 th July 2015, Haven served its response to Elephant's appeal, stating (at paragraph 5): “ Haven contends that this appeal is made out of time and should be dismissed regardless of any merits”. On 23 rd July 2015, Haven emailed Mr Armstrong, querying the circumstances in which Elephant's appeal appeared to have been admitted by MIB, and reiterating: “ Haven believes that this case has been appealed out of time”. On 27 th July 2015, Mr Armstrong replied, stating: “[I] t has always been the Technical Committee's custom and practice to allow 30 days from date of final minutes. The final minutes were released to all members on 01 April 2015, allowing 30 days from that date”.
MIB's ‘custom and practice’
On 6 th June 2013, a meeting of the Technical Committee had received a report from a working group tasked to consider revisions to Article 75 of MIB's Articles, including a recommendation that Article 75(6) be amended to “ make it clear that the time for appeal starts to run upon the date the minutes are published”.
Elephant was a member of the Technical Committee. Haven was not. In its evidence to the Judge, Elephant's representative stated that whilst he did not attend the 6 th June 2013 meeting, he “ was aware of the minutes” of it, and that the working group “ had identified that the wording of Article 75(6) was insufficiently clear to show that time for appeal starts to run upon the date when the TC minutes are published”.
On 30 th June 2015 ( i.e. after Elephant lodged its appeal in this case and Haven challenged the appeal as out of time), a general meeting of MIB resolved to amend Article 75(6)(a) of MIB's Articles by special resolution to reflect the recommendations of the working group so that Article 75(6)(a) in future read as follows:
“ Article 75(6)(a) …the Member wishing to appeal shall give to the Bureau written notice within 30 days of the issuing of the final version of the minutes of the Technical Committee making the relevant decision”.
The amendment had been circulated in draft by MIB's secretariat prior to the general meeting with the following marginal note: “ this [ i.e. time running from issue of...
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