The High Court has refused an insurer’s application to set aside an arbitrator’s ruling on whether a company could continue an insurance arbitration in its own name. The court held that the ruling was procedural, not an arbitral award that could be challenged under Article 34 of the UNCITRAL Model Law.
The judgment was delivered by Mr Justice Brian J. McGovern on 20 January 2016. F.B.D. Insurance Public Limited Company brought the application against Samwari Limited, trading as Munster Air Compressors. Arbitrator Simon Murphy was named as a notice party.
The dispute arose from a fire on 17 December 2014 at insured premises in Kilbarry Industrial Estate, Dublin Hill, Cork. The fire damaged the premises and destroyed stock. The judgment said a garda investigation into the fire had not been completed.
The insurer sought to set aside an interim determination dated 21 September 2015 concerning the status of the claimant company in the arbitration. It argued that the company could not continue the claim after passing a resolution for a creditors’ voluntary winding up and summoning a creditors’ meeting. The insurer also maintained that the company lacked an insurable interest and that any decision to arbitrate belonged to a liquidator.
The court said Article 34 does not allow an award to be reviewed simply because an arbitrator may have made an error of law or fact. For Article 34 to apply, the decision must be on the merits and meet the formal requirements for an award. Procedural orders and rulings made during an arbitration cannot be challenged under that provision.
The judge noted that the parties had agreed to earlier directions stating that no preliminary issues were to be determined and no interim award was then envisaged. The later determination about the company’s status addressed whether it could maintain the arbitration in its own name or whether a liquidator would have to pursue it. The court found it was a procedural ruling, not an interim or final award.
The court therefore did not decide whether the arbitrator was right about the company’s status. It added that the evidence had not established that the company was in liquidation and noted that no liquidator had been appointed. It made no finding about possible irregularities in company records or the cancellation of the creditors’ meeting.
The judge also said that, had it been necessary to consider the company’s status, evidence from chartered accountant Derek Ryan would not have been admissible because it had not been raised before the arbitrator and there appeared to be no good reason it could not have been presented at the preliminary hearing. The application failed, and the court refused the relief sought.