We would all like to think that any person sitting in judgment on a dispute won’t have a predisposition to decide for one party rather than the other before he’s even heard the evidence. However, adjudication sets the bar lower than other sorts of dispute in terms of how much apparent risk of bias there can be before the courts are prepared to overturn the decision.
Partly there’s no real surprise in that because the decision of an adjudicator is always only temporary anyway and the aggrieved party can go off to court or an arbitrator if he’s not happy.
The only hitch is that there will of course been good money spent in getting to the point where the adjudicator reached his decision. It won’t be a great deal of comfort to a party to know that he can go on and spend yet more money on taking the dispute further, particularly if he has a feeling that the odds were always stacked against him because the adjudicator had some sort of connection with the other party.
Generally that concern is magnified if it comes out that, however innocently, there appears to have been some sort of cover up of the link between the party and the decision-maker. In Fileturn vs Royal Garden Hotel Ltd, decided in the Technology and Construction Court on 13 July, all these factors cropped up.
In this case the adjudicator had been a partner some years before in a small firm with the representative of one of the parties. His firm had also appointed the ex-partner as adjudicator in other disputes.
The case reminded us that the proper test is whether the informed and fair-minded observer, having considered the relevant facts, would conclude that there was a real possibility that the adjudicator was biased.
The problem is that where someone chooses to argue about bias by using it as a defence to an application to enforce the adjudicator’s decision, the unhappy party has a real uphill struggle. The courts start from the position that overturning the adjudicator’s decision will cause lots of extra costs to be incurred for no good purpose. It is only where the party who was successful in the adjudication can be shown to have “no real prospect of making its case good at trial” that the adjudicator’s decision will be overturned on the basis of bias.
This means that unless the adjudicator was so biased that his decision was patently wrong anyone challenging enforcement of his decision on the basis of apparent bias is basically wasting their time and money.
What they really need to do is swallow their distaste about how and why the decision appears to have been reached. They need to look at the decision itself and decide whether that itself is wrong and concentrate their energies on the upcoming arbitration or litigation if they decide it’s actually worth pursuing at all.
That won’t help with the fact that they are likely to have to pay the costs of the lost adjudication but it will at least stop them throwing more good money away on venting their feelings about the adjudicator and his links with the other party.