English Court Rejects S68 Challenge Made On The Grounds Of Apparent Bias

In Rabbi Moshe Avram Dadoun v Yitzchok Biton [2019] EWHC 3441 (Ch), the High Court dismissed an appeal against an arbitral award (the “Award”) of the Beth Din of the Federation of Synagogues in London (the “Beth Din”) under s68 of the Arbitration Act (the “Act”). While there were unilateral and undisclosed communications between a member of the tribunal and an individual involved in the case, the Court decided that this did not amount to apparent bias. The decision clearly demonstrates the high hurdle for succeeding with a s68 application.

Background

The original dispute centred on the ownership of shares in a company. A Memorandum of Agreement (the "MOA") had been signed by the Claimant, the Defendant, the Defendant's brother and another individual, in relation to a "quasi-partnership" between them.

The case was heard by the Beth Din, a Jewish Rabbinical Court which can be used by Orthodox Jews to arbitrate their commercial disputes, on 2 June and 4 August 2008. The Award was not produced for over five years and was finally issued on 4 April 2014, largely finding in favour of the Defendant. The Claimant subsequently brought an application to challenge the Award under s69 of the Act, on the basis that the Award contained an error of law.

In 2017 the Claimant discovered the existence of a letter dated 23 July 2013, which referred to a unilateral meeting that had taken place around 9 months before the Award was issued, between the Defendant's brother and a member of the tribunal, the head of the Beth Din. This letter, sent by the Defendant to the tribunal member, also referred to another letter sent to the tribunal member by the Defendant's brother on 18 July 2013. This second letter was never found and there was no evidence of any reply by the Beth Din.

The Claimant amended his application to challenge the Award to include an application under s68 of the Act, on the basis that there was a serious irregularity affecting the Award. The initial application under s69 was then stayed.

Application under s68

The Claimant sought to challenge the Award under s68 of the Act, on the grounds that the discussion was "highly suspicious", with the unilateral communications leading to apparent bias on the part of the relevant tribunal member. This challenge was possible because awards of the Beth Din are English-seated arbitration awards and therefore subject to the supervisory jurisdiction of the English court.

The Claimant contended that:

The discussion...