Summary procedure
The Act introduces a new power1 which allows an arbitral tribunal, following the application of a party, to make an award if a claim or issue (or a defence to a claim or issue) has no “real prospect of succeeding”. The arbitral tribunal is required to give the parties a “reasonable opportunity to make representations” with respect to any such award.
Previously, a key difference between English courts and English-seated arbitrations was that the courts could (and regularly would) dismiss meritless claims at an early stage, whereas such an approach was much rarer in arbitration.
Before the Act, arbitrators already had a statutory duty to adopt procedures to avoid unnecessary delay and expense2 and, depending on the applicable institutional rules, also had summary disposal powers, but they did not have the same express powers to dismiss meritless claims as those that were spelled out in the courts’ procedural rules.
In practice this meant that prior to the introduction of the new power under the Act, even legally hopeless claims could sometimes be the subject of drawn-out arbitration, in the hope that an opponent might opt for settlement rather than spend time and money taking an arbitration through to the final merits hearing.
The practical impact of this change is significant and should not be underestimated because it fundamentally shifts how businesses involved in, or planning to use, London-seated arbitrations should approach arbitration planning and strategy.
Practical impact
It is foreseeable that summary disposal applications will become a common feature of English-seated arbitration and will be deployed in a highly strategic fashion.
- Summary disposal will not be available in all types of case. English case law does not view summary disposal as appropriate for all kinds of cases. Summary disposal is rare where factual evidence is required to determine an issue because such cases by their nature require a tribunal to hear evidence at trial. This will include, for example, situations where one side alleges that a contract has been orally formed or varied, or that a term has been orally waived. Similarly, summary disposal is generally not suitable where a case turns on complex technical issues (such as delay or disruption cases in the construction or engineering industry, or cases dealing with defects), which often require expert evidence. Summary disposal may also not be suitable in certain professional negligence cases because of the requirement for expert evidence regarding the appropriate standards expected of the profession in question.
- Time bars. Arguments about the meaning and effect of contractual time bars will be front-loaded and take on additional importance (especially given the difficulties mentioned above with regard to securing summary disposal where there are complex factual or technical issues). Time bars that are expressed in clear, unambiguous terms as acting to prevent otherwise meritorious claims are enforceable in English law and could therefore potentially form the basis of an application for summary disposal, depending on the particular circumstances of the matter. Such provisions are particularly common in, for example, standard form construction contracts requiring notice of claims to be given within specified periods. Expect also to see an increased focus on issues around whether a party had de facto or constructive notice of events, with factual evidence playing a key role in frustrating attempts to summarily dispose of issues without a full trial.
- Be careful about alleging fraud. The English courts (and potentially, by extension, English-seated arbitral tribunals) are reluctant to make a finding of dishonesty without allowing the defendant the opportunity to address the allegations. That means that a party must be careful when pitching its arguments about an opponent’s alleged misconduct because if summary disposal is strategically desirable, then alleging fraudulent conduct may backfire later because a tribunal might be reluctant to deprive the opposing party of the opportunity to rebut the allegations. This is arguably less of an issue in terms of protection of reputation in confidential arbitration than in public litigation before the courts, but one can still foresee similar arguments being made before arbitral tribunals.
- Enforceability. Historically, the differing approach to summary disposal between the English courts and English-seated arbitrations was in part due to the fact that arbitrators are under a statutory duty to give each party a reasonable opportunity to put their case, and if they failed to do so, their award could be challenged before the domestic courts and recognition and enforcement of an award could also be refused by foreign courts. The question remains whether, even with the inclusion of an express power of summary disposal, a foreign court would refuse enforcement on the basis that the losing party was afforded insufficient opportunity to put its case. It follows that if an arbitral claimant is worried about enforcing a summary award on this basis in a particular jurisdiction, then it may make sense for them to avoid applying for summary disposal.
- Timing of applications: expert evidence and discovery. Expect to see arguments that summary disposal should only be available after discovery of documents and/or after expert evidence has been exchanged. Case law suggests that summary disposal will only be ordered in cases that revolve around expert evidence after the exchange of experts’ reports. Arbitral tribunals will not want to endorse “fishing expeditions” for documents, but equally they will not be inclined to summarily dispose of a claim if a party can show that would be premature before it has had the opportunity to consider the other side’s document production.
- Choice of arbitral rules and drafting of arbitration clauses. The choice of specific institutional rules and the way they interplay with the new statutory summary disposal power will be important. Some institutional rules already envisage summary disposal, whilst others do not, and the relationship between such rules (or the absence of them) and the Act may give rise to arguments as to what the parties have already agreed with respect to summary disposal. If parties are against the idea of summary disposal, then it would make sense for that to be stated expressly in the arbitration agreement.
In summary, although many practitioners welcome the introduction of an express power to summarily dispose of issues in English-seated arbitration, this raises important practical and strategic considerations that arbitration users should have at the forefront of their minds when arbitrating in England & Wales and Northern Ireland, including using lawyers familiar with the “no real prospect of succeeding” test.
Our next article in this series will address the changes introduced by the Arbitration Act 2025 regarding the law governing the arbitration agreement.
View the The Arbitration Act 2025 reshapes London-seated arbitration article – the biggest statutory changes to arbitration law in England, Wales and Northern Ireland for a generation.
1. Arbitration Act 1996, section 39A.
2. Arbitration Act 1996, section 33(1)(b).
Client Alert 2025-077
