Arbitrator Impartiality – When Can It Be Challenged?

Recent High Court decisions and statutory reforms in the United Kingdom have given detailed guidance on an arbitrators’ duties of disclosure and what must be shown to establish apparent bias.

These developments will be of particular interest to users of London Arbitration, especially under LMAA Terms, and will interest parties who query what safeguards exist to ensure that a tribunal does not favour one side over the other. 

In V and another v K¹

In this case, K (the Seller) entered into a memorandum of agreement dated 14 July 2022 to sell a vessel to V or their guaranteed Nominee, N (together, the Buyers) for the amount of US$ 13.1 million (the MOA). 

On 19 July 2022, the Seller and V entered into an escrow agreement with the Seller’s solicitors. This provided for a deposit in the amount of 15% of the purchase price for the vessel US $1.965 million (the Deposit) and the balance of the purchase price of US $11,350,000 to be paid into the Seller’s solicitors client account.²

Following the imposition of sanctions on V in September 2022, the Seller terminated the MOA and sought release of the deposit held in escrow by the Seller’s solicitors. The Seller commenced LMAA arbitration in London. The two arbitrators appointed by the parties were senior KCs, and in due course, another senior KC was appointed as Tribunal Chair. For a period of time, the Buyers refused to participate any further, and claimed the arbitration was conducted without impartiality and was tainted by apparent bias. 

The Buyers took particular issue with the conduct of the Seller’s party appointed arbitrator (Mr H) who was an experienced Barrister. Amongst other things, the Buyers’ solicitors asked Mr H to confirm the extent of his past professional relationship with the Sellers’ solicitors. They also alleged that Mr H sought to protect the reputation of the law firm that had appointed him. 

In one instance, the Buyers’ own party-appointed arbitrator intervened, and said:

Mr H advised the relevant law firm appointed him on eight occasions since 2008 (only two of those progressed to an award where total fees amounted to around £41,000) and once as Barrister in 2014 (total fees earned were £3,900). 

That being said, the Tribunal decided there was no substance to the allegations of bias and these were rejected. The Buyers appealed to the High Court in London to advance the serious accusation that the Tribunal was guilty of apparent bias on six grounds. At the hearing, the Buyers abandoned all but one of these grounds.

The remaining ground of challenge was that Mr H’s repeated lack of candour misrepresented the nature and extent of his relationships with the solicitors appointed by each side. In particular, Mr H downplayed or concealed his connection with himself and the law firm which appointed him. 

The Buyers brought that appeal under section 68(2)(a) of the Arbitration Act 1996 (the 1996 Act). It states:

The High Court said the starting point was the common law principles laid down in Supreme Court’s decision in Halliburton v Chubb⁵:

• The test for apparent bias was: “…whether the fair-minded and informed observer, having considered the facts, would conclude that there was a real possibility that the tribunal was biased.”⁶
• In this regard, context forms an important part of the material which the fair-minded observer must consider before judgment.⁷ The objective observer, the Supreme Court said, “will appreciate that there are differences between, on the one hand, arbitrations, in which there is an established expectation that a person before accepting an offer of appointment in a reference will disclose earlier relevant appointments to the parties and is expected similarly to disclose subsequent appointments occurring in the course of a reference, and, on the other hand, arbitrations in which, as a result of relevant custom and practice in an industry, those expectations would not normally arise“.⁸ For instance, in GAFTA and LMAA arbitrations, it is well known that arbitrators acted in multiple arbitrations, which may arise from the same events. This is in contrast to other arbitral associations, such as ICC arbitrations, where disclosure of multiple appointments is required at the date of appointment. 
• A failure to disclose does not necessarily lead to the removal of the arbitrator, but it is a factor that the fair-minded and informed observer would consider in order to decide whether there is a real possibility of bias.

On this basis, the Buyers argued that a fair-minded and informed observer would think there was a real possibility of bias because Mr H failed to disclose his previous connection with the law firm which appointed him, and because of the way he answered their questions about that connection.⁹

With Halliburton v Chubb in mind, the court repeated it was a common feature of LMAA arbitrations that law firms often appoint arbitrators in unrelated references, and disclosure is not required unless there are particular circumstances that make it necessary. 

Given that, the court reasoned a fair-minded and informed observer would not conclude that there was a real possibility of bias in this case.¹⁰ The Tribunal’s procedural decisions were unanimous and fair, and the appointments in question made up a very small fraction of the arbitrator’s overall appointments and income within the relevant period. Buyers’ suggestion to the contrary was purely tactical, had no merit whatsoever and should never have been made.¹¹

The Buyers’ appeal failed on its merits. 

Aiteo Eastern E&P v Shell Western Supply

Justice Calver in V and another v K, said it was noteworthy that his judgment contrasts with Aiteo Eastern E&P v Shell Western Supply [2024]¹². 

In Aiteo, disputes were to be resolved by ICC arbitration in London. The Respondents appointed a retired judge as arbitrator. The judge had received seven other appointments by that law firm in the previous five years as well as some expert instructions. At the time of the appointment, the judge stated that she had been party- appointed in two other unrelated arbitrations in the last few years by that law firm. 

The Claimant appealed to the High Court under section 68 of the 1996 Act to set aside the arbitration awards in the reference on the grounds of the judge’s apparent bias by reason of her professional links with the law firm which appointed her. Furthermore, it was alleged she failed to disclose those links in a timely fashion. The Claimant argued the breach of section 68 gave rise to substantial injustice.

There were factors in play, Justice Calver said, which distinguished Aiteo from V and another v K.

• Firstly, it was an arbitration under ICC rules (Article 11) which required disclosure of: “any facts or circumstances which might be of such a nature as to call into question the arbitrator’s independence in the eyes of the parties, as well as any circumstances that could give rise to reasonable doubts as to the arbitrator’s impartiality”. This stood in contrast to the relevant guidance in the LMAA Advice on Ethics, which states: “there is a custom or practice for parties or their representatives to frequently appoint the same arbitrator in different cases…. However, it remains the case in maritime arbitration that the pool of arbitrators and the number of specialised law firms and other representatives who appoint arbitrators is not large and it is accepted as inevitable that such circumstances will arise. This is not considered to be a matter for disclosure although an arbitrator should always be satisfied as to the other matters referred to in these notes”.¹³
• Secondly, a successful challenge was brought before the ICC Court, the authority responsible for handling challenges to arbitrator appointments pursuant to article 14 of the rules which govern ICC arbitrations. The informed observer would appreciate that the decision to remove the arbitrator was a rare example of a challenge that succeeded, and the decision could serve as a useful cross-check on the observer’s own conclusions based on these facts.

In Aiteo, the fair-minded and informed observer would conclude that there was a real possibility the arbitrator was biased on the facts of that case. 

Analysis and commentary

In February 2025, the Arbitration Act 2025 (AA25) entered into force in full on 1 August 2025. The AA25 codifies the duty of disclosure established by the UK Supreme Court in Halliburton v Chubb, and the subsequent cases discussed above, and requires arbitrators to disclose circumstances that would or might give rise to doubts as to their impartiality. This obligation extends to circumstances that an arbitrator is actually aware of or ought reasonably to be aware of.

The 2025 Act creates a clear framework that should cut down disputes over an arbitrator’s duty of disclosure and reduce the scope for parties to raise tactical arguments aimed only at delay. Even so, an arbitrator’s duty to disclose prior appointments will still turn on the rules of the relevant association and the arbitrator’s own experience. Courts in the United Kingdom will not welcome opportunistic challenges and will continue to set a high bar for claims of bias. Parties should look hard at their own approach and decide whether disclosure is in fact needed in the circumstances of their case.

Crucially, the AA25 does not outline which specific circumstances must be disclosed; this is deliberate and allows the retention of some flexibility. As Mr Justice Calver explained at length in V and another v K, arbitration is used in a wide range of sectors, and the matters which may give rise to justifiable doubts as to the impartiality of an arbitrator will vary.

The arbitrator in Aiteo was held to have breached her duty of disclosure, even though she had arguably been more proactive in raising potential conflicts than the arbitrator in V and another v K. An important factor was that the ICC Rules applied in Aiteo, which impose a more exacting standard of disclosure than the LMAA Rules. The Court’s finding illustrates that the applicable institutional rules can materially affect the scope of an arbitrator’s disclosure obligations, and that what may be acceptable under one association can amount to a breach under another.

Footnotes:

1. [2025] EWHC 1523 (Comm).
2. For further details see: Virgo Marine Inc and Nixie Marine v. Reed Smith LLP and Barclays Bank PLC [2025] EWHC 1157 (Comm).
3. [2025] EWHC 1523 (Comm), para 89.
4. Under section 33 of the Arbitration Act 1996 an arbitrator is under statutory duties to act fairly and impartially. Those statutory duties give rise to an implied term in the contract between the arbitrator and the parties that the arbitrator will so act. 
5. [2021] AC 1083.
6. Porter v Magill [2001] UKHL 67, para 103.
7. https://www.hfw.com/insights/optics-and-context-in-arbitral-appointments-a-review-of-the-uk-supreme-court-judgment-in-halliburton-company-v-chubb-bermuda-insurance-ltd/.
8. [2021] AC 1083 paras 127-128.
9. [2025] EWHC 1523 (Comm), para 48.
10. Ibid. para 141.
11. Ibid. para 47.
12. EWHC 1993 (Comm).
13. https://lmaa.london/advice-on-ethics/.