The whole topic of bias is rooted in the crucial ingredient of adjudicator independence, writes Tony Bingham

Perceived bias of adjudicators and arbitrators remains a hot topic, or rather hot target. The dispute referee, whether judge, arbitrator or adjudicator will invariably be labelled as biased by the losing side. This has just cropped up in Bellway Homes Ltd vs Surgo Construction Ltd. It’s not an accusation of actual bias. No, no, it’s perceived bias. It’s all in that word “perceived”. If made out, the tribunal’s decision is ineffective.

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Tony Bingham is a barrister and arbitrator at 3 Paper Buildings, Temple

I like the example of bias in the long goodbye of Jurgen Klopp, from Liverpool FC. His league cup opponent, Chelsea manager Mauricio Pochettino, asked the FA referees’ department to remind the chosen referee not to be influenced by Liverpool’s loss of probably the best manager in the world. Klopp wanted his legacy to go out on a crop of silver – but, said Pochettino, not with a leg-up from the referee. Pochettino will get a thick ear for his implied criticism – but I suspect you see his point.

Bellway Homes’ homemade subcontract document has a tailor-made adjudication clause. It compiled a mini list of adjudicators and, in any dispute, Bellway will choose a name from its own list. Surgo’s challenge of bias was thrown out because that provision was in the contract at the outset and deemed to be agreed by the subcontractor. Surgo had perceived (that word again) the list as enough to unwittingly subconsciously influence those adjudicators on the list to (how shall we say?) keep on the Bellway list. That’s the problem with “perception”. One man’s perception is another man’s utter tosh.

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Seven judges perceived a distinguished High Court judge as biased – not actually biased but ostensibly or apparently biased – in the case of Almazeedi vs Penner. Here was a judge of utmost integrity who, in law, lacked independence, it was said. Seemingly he was hearing a case in the Cayman Islands where a party was also a minister in the Qatar judicial appointments office 8,000 miles away. It so happens that the judge was on a fee-paying appointments panel in Qatar and was a possible appointee. He had never received a single appointment via this party in Qatar, but circumstances gave a risk of bias – a perceived risk. So he was removed from the litigation in the sunny Cayman Islands.

If you want to understand bias, here is the basic approach for what I call unwitting or apparent bias. Consider this remark by Lord Chief Justice Hewart in the famous case of R vs Sussex Justices, ex parte McCarthy (1924): “It is not merely of some importance but is of fundamental importance that justice should not only be done, but should manifestly and undoubtedly be seen to be done […] Nothing is to be done which creates even a suspicion that there has been an improper interference with the course of justice.”

You might see in Bellway Homes vs Surgo that running a private in-house list of adjudicators can at least cause the opponent to blink

The legal test is “whether the fair-minded and informed observer having considered the facts would conclude that there was a real possibility that the tribunal was biased”. This fair-minded and informed observer is not unduly sensitive nor unduly suspicious but neither is complacent. It is what we call an objective test by way of an intense focus on the essential facts of the case.

You might see in Bellway Homes vs Surgo that running a private in-house list of adjudicators can at least cause the opponent to blink. You design a contract clause that has just a few bods ready and willing to do the business. But are they somehow beholden to the list compiler? These adjudicators earn their living from picking up appointments. Is there an unwitting psychology at play, which causes the adjudicator to unwittingly trim and tailor the award to avoid slipping out of the list?

Put it this way: Is the relationship with the enterprise who has the power to appoint open to abuse? Let me explain that. Appointing an adjudicator or similar is supposed to be, has to be, at arm’s length or agreed between the parties (that is: actual consent). Some folks do try to get consent. The truth is that it is the kiss of death for X to urge his opponent Y to agree Joe Soap as tribunal. So the fallback is to use the appointing body identified in the contract or, if none is identified, it is open to go to any enterprise that holds itself out to be an ANB (adjudicator nominating body). So X applies to this ANB. And the ANB gets a fee; £400 is not unusual.

It’s an administration charge. Some say that the ANB forms an unhealthy relationship with its regular “customers”. Some say that folk such as X and others are able to pull strings to get the adjudicator that X prefers; his opponent doesn’t know what’s going on behind the veil. It’s not as brutal as that. More likely, X is happy to use a particular ANB because he is confident in the knowledge and experience of the adjudicators on that list. Confident too that the chosen adjudicator is competent given the type and complexity of the dispute in the notice of adjudication. There is nevertheless lobbying by X; it has to stop. The correct approach is to require the ANB to operate appointments by cab rank rule. The whole topic of bias is rooted in the crucial ingredient of adjudicator independence.

By the way, Chelsea lost to Liverpool by one goal. I don’t know whether Mauricio Pochettino complained about the ref.

Tony Bingham is a barrister and arbitrator at 3 Paper Buildings, Temple