What Can You Do If Your Umpire Or Adjudicator Fails To Provide Adequate Reasons In His Decision? Will The Court Assist?

Where an adjudicator or an umpire appointed to carry out an expert determination fails to provide adequate reasoning for their decision is there anything that can be done? This was something Mr Justice Cresswell had to consider in the recent case of Halifax Life Limited v The Equitable Life Assurance Society [2007] EWHC 503.

Expert Determination

In the case before Mr Justice Cresswell, the Halifax brought proceedings seeking a declaration that an expert determination was not final and binding because the expert had materially departed from his terms of reference and had failed to provide adequate reasons.

The Halifax said the Expert had failed to provide reasons which explained why he rejected their principle contentions and that he had failed to provide reasons which explained what he had learned from private meetings with the Defendant's representatives, what documents he had been shown and how this information influenced him in deciding how to deal with the concerns expressed by the Halifax. Hence, the Expert had materially departed from his instructions and his decision contained a manifest error. There was no allegation of fraud or partiality.

The Judge referred to the case of Bernhard Schulte & Others v Knarl Holdings Ltd where Cooke J said that an expert, subject to the express provisions of his remit, is entitled to carry out his own investigations, form his own opinion and come to his own conclusion regardless of any submission of evidence adduced by the parties themselves. Here, the Expert was appointed to resolve defined issues in accordance with the contract. The parties had to provide to him such information or documentation as he reasonably required and to make available to be questioned any person whom he considered to be able to supply relevant information. In coming to his decision, the Expert was entitled to consider only the matters in dispute and only to take into account such evidence and information as the parties put before him.

The Judge noted that if an expert makes a mistake while carrying out his instructions, the parties are bound by it for the reasons that they have agreed to be bound by his decision. However where the expert departs from instructions in a material respect, the parties have not agreed to be bound. This is because the expert has not done what he was appointed to do. Where the contract provides that a decision should be final and binding save for manifest error, any departure from instructions...