HOUSE OF LORDS
Originally published in the Law Reports as:  1 A.C. 562
Posted in its entirety here as a public-interest document for the use of U.S. parties to the Lloyds cases, and for academic and scholarly purposes (See 17 U.S.C. § 107)
COUNSEL: Jonathan Sumption Q.C. and Christopher Butcher for the respondent.
Anthony Coleman Q.C., Jonathan Gillman Q.C. and John Lockey for the claimant. (at the Court of Appeal and in the House of Lords).
SOLICITORS: Elborne Mitchell; Fishburn Boxer (at the Court of Appeal and in the House of Lords).
JUDGES: Lord Donaldson of Lymington M.R., McCowan and Leggatt L.JJ.
Lord Mackay of Clashfern L.C., Lord Keith of Kinkel, Lord Brandon of Oakbrook, Lord Ackner and Lord Oliver of Aylmerton
DATES: 1991 Feb. 25, 26; March 11; July 8, 9, 10; 24
ArbitrationAwardApplication for leave to appealArbitration agreement under English law for arbitration to take place in LondonAward signed and dated by arbitrator in FranceWhere madeWhether New York Convention on Recognition and Enforcement of Foreign Arbitral Awards applicableApplications for leave to appeal, further reasons and remissionWhether English courts supervisory jurisdiction excludedArbitration Act 1975 (c. 3), ss. 3(2), 5(2)(f)(5), 7(1)
By an agreement under English law the parties, members of two Lloyds syndicates, referred their dispute to arbitration to take place in London. The arbitration was conducted by stages, each stage concluding in an award signed and dated by the arbitrator, his signature being witnessed by his secretary, and expressed by him to be Dated at Paris, France, at a particular address. The award on the second stage, made in August 1990, was by declaration and was in draft to enable the parties to make further representations on its form. In correspondence the parties solicitors canvassed between them the timing of future applications to the court for leave to appeal. On 20 November 1990 the arbitrator made his final interim award, concluding it in the same manner as before. The award was collected from the arbitrators London chambers shortly afterwards. On the claimants applications for leave to appeal under section 1(3) of the Arbitration Act 1979, for a statement of further reasons under section 1(5) of that Act and for remission under section 22 of the Arbitration Act 1950, the judge, on a preliminary issue, rejected the contention of the respondent to the arbitration that the award had been made in Paris so as to be a Convention award within the meaning of section 7(1) of the Arbitration Act 1975,1 which Act gave effect to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, and that he could therefore rely on section 3(2) of that Act to defeat any application under the Acts of 1950 and 1979 for supervision by the English court as the competent authority. The judge held that an award was made at the central seat of arbitration, which had been in London, that the award was therefore not a Convention award to which the provisions of the Act of 1975
1 Arbitration Act 1975, s. 3(2): see post, p. 578E-F.
S. 5(2)(f)(5): see post, pp. 578G-579A.
S. 7(1): see post, p. 568E. [*563]
applied. He indicated that, in any event, he would have held that section 5(2)(f) and (5) of the Act of 1975 enabled the English court to determine the claimants applications before considering whether or not to give effect to the award under section 3(2), and that the respondent was estopped from raising the objection. On appeal by the respondent, the Court of Appeal held that the award was made in Paris, and was thus by definition a Convention award and that (Lord Donaldson of Lymington M.R. dissenting) the High Court was thereby deprived of jurisdiction to entertain the claimants applications. But the appeal was dismissed (Leggatt L.J. dissenting) on the ground that in the circumstances the respondent was estopped from objecting to the jurisdiction of the High Court.
On appeal by the respondent to the arbitration:–
Held, dismissing the appeal, that by virtue of the place of signature the award was made in Paris and was therefore a Convention award; that, albeit it was a Convention award, on a purposive construction of section 5(2)(f) and (5) of the Arbitration Act 1975 the High Court continued to have the power of enforcing its curial jurisdiction over the arbitration and of adjourning, if necessary, any decision on the enforceability of the award until the pending proceedings for review had been determined (post, pp. 590E-G, 594C, H-595B, 597G-598B, F-599A).
Brooke v. Mitchell (1840) 6 M. & W. 473 considered.
Decison of the Court of Appeal, post, pp. 566A et seq.;  2 W.L.R. 1321;  3 All E.R. 124 affirmed on different grounds.
The following cases are referred to in the opinion of Lord Oliver of Aylmerton:
Brooke v. Mitchell (1840) 6 M. & W. 473
Hiscox v. Outhwaite (No. 2)  1 W.L.R. 545;  3 All E.R. 143, C.A.
The following additional cases were cited in argument in the House of Lords:
Compagnie Européene de Céréals S.A. v. Tradax Export S.A.  2 Lloyds Rep. 301
European Grain and Shipping Ltd. v. Johnston  Q.B. 520;  2 W.L.R. 241;  3 All E.R. 989, C.A.
Fothergill v. Monarch Airlines Ltd.  A.C. 251;  3 W.L.R. 209;  2 All E.R. 696, H.L.(E.)
Mordue v. Palmer (1870) L.R. 6 Ch.App. 22
Naviera Amazonica Peruana S.A. v. Compania Internacional de Seguros del Peru  1 Lloyds Rep. 116, C.A.
The following cases are referred to in the judgments of the Court of Appeal:
Amalgamated Investment & Property Co. Ltd. v. Texas Commerce International Bank Ltd.  Q.B. 84;  3 W.L.R. 565;  3 All E.R. 577, C.A.
Brooke v. Mitchell (1840) 6 M. & W. 473
Hamel-Smith v. Pycroft Jetsave Ltd. (unreported), 5 February 1987, Peter Gibson J. [*564]
Norwegian American Cruises A/S (formerly Norwegian American Lines A/S) v. Paul Mundy Ltd.  2 Lloyds Rep. 343, C.A.
Wilkinson v. Barking Corporation  1 K.B. 721;  1 All E.R. 564, C.A.
The following additional cases were cited in argument in the Court of Appeal:
Bremer Vulkan Schiffbau und Maschinenfabrik v. South India Shipping Corporation Ltd.  A.C. 909;  2 W.L.R. 141;  1 All E.R. 289, H.L.(E.)
Bulk Transport Corporation v. Sissy Steamship Co. Ltd.  2 Lloyds Rep. 289
Dalmia Dairy Industries Ltd. v. National Bank of Pakistan  2 Lloyds Rep. 223, Kerr J. and C.A.
Union Nationale des Co-operatives Agricoles de Céréales v. Robert Catterall & Co. Ltd.  2 Q.B. 44;  2 W.L.R. 532;  1 All E.R. 721, C.A.
The following additional cases, although not cited, were referred to in the skeleton arguments in the Court of Appeal:
Bank Mellat v. Helliniki Techniki S.A.  Q.B. 291;  3 W.L.R. 783;  3 All E.R. 428, C.A.
Black-Clawson International Ltd. v. Papierwerke Waldhof-Aschaffenburg A.G.  A.C. 591;  2 W.L.R. 513;  1 All E.R. 810, H.L.(E.)
Black Clawson International Ltd. v. Papierwerke Waldhof-Aschaffenburg A.G.  2 Lloyds Rep. 446
Dalmia Cement Ltd. v. National Bank of Pakistan  Q.B. 9;  3 W.L.R. 138;  3 All E.R. 189
Fothergill v. Monarch Airlines Ltd.  A.C. 251;  3 W.L.R. 209;  2 All E.R. 696, H.L.(E.)
Lokumal (K.) & Sons (London) Ltd. v. Lotte Shipping Co. Pte. Ltd.  2 Lloyds Rep. 28, C.A.
Whitworth Street Estates (Manchester) Ltd. v. James Miller & Partners Ltd.  A.C. 583;  2 W.L.R. 728;  1 All E.R. 796, H.L.(E.)
INTERLOCUTORY APPEAL from Hirst J.
By applications dated 10 December 1990 the claimant, Robert Ralph Scrymgeour Hiscox, applied on his own behalf and on behalf of the members of Syndicate 33 at Lloyd's, for (1) leave to appeal to the High Court pursuant to section 1(3)(b) of the Arbitration Act 1979 on questions of law arising out of an interim award dated 20 November 1990 made by the sole arbitrator, Mr. Robert MacCrindle Q.C., in respect of a dispute referred to arbitration between the claimants syndicate and the respondent, Richard Henry Moffit Outhwaite, on behalf of himself and all other members of Syndicate 661 at Lloyd's, who were party to the contract of reinsurance, the subject matter of the dispute; (2) an order directing the arbitrator to state further reasons pursuant to section 1(5) of the Act of 1979; and (3) an order remitting the award to the arbitrator under section 22 of the Arbitration Act 1950. On 19 February 1990 Hirst J. held that the arbitrators award had been made in London and that the High Court had jurisdiction to hear and determine the applications. [*565]
By a notice of appeal dated 20 February 1990 the respondent appealed with leave of the judge on the grounds that the judge (1) had erred in law in holding that the award had been made in London; he ought to have found that it had been made in Paris as was stated therein which was the place where the arbitrator had signed and dated the award; (2) had erred in law in holding that for the purposes of the Arbitration Act 1975 an award was made where the central point of the arbitration proceedings was located and not where the award stated it was made and/or where the arbitrator signed and dated it; (3) had erred in law in failing to find that the award was a Convention award within the meaning of the Arbitration Act 1975; (4) had erred in finding that the construction of the Act of 1975 asserted by the respondent produced absurd results whereas that of the claimant did not; he should have preferred that of the respondent which gave the plain and natural meaning to the words of the statute; (5) should have found that section 22 of the Act of 1950 and the Act of 1979 were by implication restricted to awards within the jurisdiction of the court; (6) should therefore have found that the High Court lacked jurisdiction either to entertain the claimants applications under the Acts of 1950 and 1979, and should have treated the award as binding for all purposes between the parties under section 3(2) of the Act 1975; (7) had been wrong in forming provisional conclusions that section 5(2)(f) of the Act of 1975 supported the contention that the award was subject to any remedies under the Acts of 1950 or 1979, or that the respondent was estopped from asserting that the High Court had no jurisdiction to grant the relief sought by the claimant: he should have found that there was no common assumption that the High Court had such jurisdiction; (8) had erred in holding that no question of jurisdiction arose, and that the respondents contentions were simply a defence under the Act of 1975; and (9) should have held that no act of the parties could create in the High Court a jurisdiction which it did not have.
The facts are stated in the judgment of Lord Donaldson of Lymington M.R.
Jonathan Sumption Q.C. and Christopher Butcher for the respondent.
Anthony Coleman Q.C., Jonathan Gillman Q.C. and John Lockey for the claimant.
The argument addressed to the Court of Appeal on the issues (a) where the award was made and (b) whether if it was made in France the English courts supervisory jurisdiction under the Arbitration Act 1950 and 1979 was excluded, is substantially the same as that addressed to the House of Lords, post, pp. 585E-587F, 588A-589E, G-590C. On the issue whether the respondent in the arbitration was estopped from relying on any such exclusion the argument advanced to the Court of Appeal was addressed to the factual circumstances of the case and does not call for report.
Cur. adv. vult.
11 March. The following judgments were handed down. [*566]
LORD DONALDSON OF LYMINGTON M.R.
This appeal from a decision of Hirst J. raises two interesting and novel points of arbitration law: (1) where is an arbitration award made for the purposes of section 7(1) of the Arbitration Act 1975 which defines a Convention award as meaning an award made in pursuance of an arbitration agreement in the territory of a state, other than the United Kingdom, which is a party to the New York Convention, (2) to what extent, if at all, do the Arbitration Acts 1950 and 1979 apply to a Convention award where the procedural law of the arbitration is English?
There is an additional issue, which is of less general importance, namely whether the respondent in the arbitration, Mr. Outhwaite, is estopped by his conduct from raising either point.
The dispute which was referred to arbitration concerned liabilities under a reinsurance contract, both parties being members of Lloyd's. The original agreement to refer contemplated the appointment of two arbitrators and an umpire, but this was varied by the agreement of the parties to an agreement to refer to the arbitrament of Mr. R. A. MacCrindle Q.C. as sole arbitrator. The original arbitration agreement provided that the arbitration shall take place in London and this was unaffected by the variation. Both this agreement and the reinsurance contract were governed by English law.
The arbitration was conducted by stages. The first stage concerned a contention on the part of Mr. Outhwaite that he was entitled to avoid the contract of reinsurance ab initio by reason of non-disclosure or alternatively of misrepresentation and . . . that by a letter dated 2 September 1987 he had validly avoided or rescinded it. By an award dated 30 June 1989 Mr. MacCrindle rejected this contention. The award concluded:
The second stage, by agreement between the parties, was limited to a determination by way of preliminary issue of such issues of principle relating to the quantum of the claims payable by the respondent as might be pleaded by the parties.
Hearings took place in April and May 1990 and in August 1990 Mr. MacCrindle made an award in the form of a declaration. The award was in draft because all concerned contemplated that in so complicated a [*567] matter the declarations might require clarification. Accordingly the award provided:
8. If within six weeks of the date hereof I shall have been notified in writing by either party that it desires to make representations to me as to the form which my interim award herein shall take, having regard to my reasons, the foregoing shall be treated as a draft only and the final form will be determined following a further hearing for that purpose or as may be otherwise agreed by the parties. Unless I shall have been so notified within such six weeks the foregoing shall stand as my interim award.
The award concluded in the same form as that on liability, save that it was dated 6 August 1990. In fact it appears to have reached the parties on 2 August 1990.
On 3 August 1990 Fishburn Boxer, solicitors acting on behalf of the claimant, Mr. Hiscox, wrote to Elborne Mitchell, solicitors acting on behalf of Mr. Outhwaite:
We take the view, and we would be obliged if you would confirm that you agree, that if either party is contemplating making an application for leave to appeal to the court on any aspect of the award, time does not run until at the earliest six weeks from 6 August 1990.
On 6 August 1990 Elborne Mitchell replied:
It is our understanding of point 8 of the arbitrators award that if either party within six weeks of 6 August 1990 notifies the arbitrator in writing that it desires to make representations as to the form of the arbitrators award, then this award dated 6 August 1990 shall be treated as a draft only and the final form will be determined following the further hearing and that the time for appeal will commence running from the date of this final form. If, however, neither party notifies the arbitrator in writing within six weeks of 6 August 1990 that it desires to make representations, then the award dated 6 August 1990 will be treated as the arbitrators interim award and that the time for appeal will commence running at six weeks from 6 August 1990, as you have stated in the second paragraph of your letter of 3 August 1990.
In the event one or other or both parties notified Mr. MacCrindle that they required a further hearing and the award of 6 August took effect as a draft only. That further hearing took place on 6 November 1990. Thereafter Mr. MacCrindle signed a final interim award. This was dated 20 November 1990 and concluded in the same way as the previous awards save that the address was 12 Rue d'Astorg, 75008 Paris, France.
When Mr. MacCrindle was in practice at the English Bar, he was in chambers at 4, Essex Court, Temple, London and he remains a door tenant of those chambers and, as such, has the services of their clerk. On 20 November 1990 Mr. Hiscoxs solicitors were informed by the clerk by fax that the award could be taken up at those chambers on [*568] payment of the balance of the charges due and shortly thereafter they collected the award.
On 10 December 1990, Mr. Hiscox initiated the following proceedings: (1) an originating summons for leave to appeal to the High Court under section 1(3)(b) of the Arbitration Act 1979; (2) an originating summons for an order directing Mr. MacCrindle to state further reasons for his award, pursuant to section 1(5) of the Arbitration Act 1979; (3) an originating motion seeking remission of the award pursuant to section 22 of the Arbitration Act 1950.
We are not concerned with the merits of those proceedings, which at present stand adjourned. Our concern is with Hirst J.s decision on a preliminary objection taken by Mr. Outhwaite that this was a Convention award and, under the terms of the Arbitration Act 1975, the High Court was disabled from adjudicating upon those proceedings. In summary, Hirst J. held that this was not a Convention award because, although dated in Paris, it was made in London for the purposes of the Act of 1975. He also said that he was inclined to accept Mr. Hiscoxs contention that even if it was a Convention award he had the necessary jurisdiction to adjudicate upon those proceedings which he had initiated. Finally he held that, had it been necessary to do so, he would have acepted Mr. Hiscoxs contention that Mr. Outhwaite was estopped from asserting that this award was not subject to the Arbitration Acts 1950 and 1979.
Was this a Convention award?
The Arbitration Act 1975 is, as its long title proclaims, An Act to give effect to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards. The definition of a Convention award is contained in section 7(1) of the Act and is in the following terms:
Convention award means an award made in pursuance of an arbitration agreement in the territory of a state, other than the United Kingdom, which is a party to the New York Convention.
France and some 50 other countries including the United Kingdom are parties to the Convention.
Whether or not this was a Convention award depends solely upon whether it was made in France. Hirst J. was greatly impressed by an article by Dr. F. A. Mann, in the quarterly journal Arbitration International in April 1985. Dr. Mann expressed the view that:
An award is made at the place at which the arbitration is held, i.e. at the arbitral seat. It is by no means necessarily identical with the place or places where hearings are being held or where the parties or the arbitrators reside. It is rather the place fixed in the contract or the submission or the minutes of the hearing or is found to be the central point of the arbitral proceedings. It is the place which in the case of institutional arbitration will always be certain, which otherwise will only in the rarest of cases be open to doubt, and which in no reported case seems ever to have been questionable, for, as experience shows, where there could be any doubt, the arbitrators will almost invariably determine the place by agreement [*569] with the parties or if necessary by their own ruling recorded in the minutes. This is the place which is independent of the place of meetings of the arbitrators, hearings with the parties, or of the actual signature or publication of the award. If a place other than the seat is held to be decisive, unacceptable consequences could ensue. An arbitration which in every possible sense is an English one could suddenly become foreign, merely because the arbitrator has gone to Paris and signed and, perhaps, dispatched the award there. If there are three arbitrators who hold an arbitration in London, but meet in Paris to consider their award, and sign it at their respective residences, viz., New York, Geneva and Tokyo, the award should be treated as made' in London, even if each arbitrator has indicated the place where he has signed it. The award, it is submitted, is no more than a part, the final and vital part of a procedure which must have a territorial, central point or seat. It would be very odd if, possibly without the knowledge of the parties or even unwittingly, the arbitrators had the power to sever that part from the preceding procedure and thus give a totally different character to the whole.
It will be seen that Dr. Mann foresaw precisely the problem which has arisen here. Hirst J. accepted this view and held that this award was made in London, that being the central point of the present arbitration proceedings.
I accept the problems which may arise if there is more than one arbitrator but, as Mr. Jonathan Sumption, who has appeared for Mr. Outhwaite in this court, pointed out, the award cannot be made unless and until the last arbitrator has assented to the award by signing it. This is the earliest time when the award can be said to be made and may determine where it is made. Accordingly I do not think that it could be argued in such a case that the award could be made in three different countries. I also accept that if the place of signature, or of the last signature, on the award is the crucial test, an award may become, or fail to become, a Convention award almost by caprice and contrary to the expectations and, it may be, the wishes of the parties.
However, with regret, I am unable to accept Dr. Manns and Hirst J.s view that an award is made at the seat or central point of the arbitration. Where the court is concerned with a statute avowedly designed to give effect to an international Convention, in the event of ambiguity it is permissible to have regard to the travaux préparatoires in order to ascertain the mischief at which the Convention was directed. Those travaux, which we have seen, make it clear that the mischief was a tendency for countries to categorise awards as foreign or domestic for enforcement purposes by reference not to where the arbitration was held or the award was made, but by reference to such considerations as the nationality of the parties involved or the law governing the arbitral procedure.
Eight states wished to continue with this system, but it is reasonably clear that this view did not prevail and that the intention was to make the application of the Convention depend upon a universally applicable [*570] objective criterion, namely where the award was made regardless of what was the procedural law which governed the arbitration.
This conclusion leaves open the possibility that it is not the act of signing the award which constitutes making it, although it may do so, but the delivery of the award to the parties or a notification to them that it is ready for delivery. In the instant case the award was signed in Paris, but the parties were notified that it was ready for collection from 4, Essex Court in the Temple in London and delivery of it was taken from that address.
In Brooke v. Mitchell (1840) 6 M. & W. 473 the plaintiff began an action in trespass. At that time such a cause of action terminated with the death of the aggrieved party. The plaintiffs claim was referred to arbitration on terms that in the event of the arbitrators disagreeing, as they did, the umpire should make and publish his umpirage in writing, ready to be delivered to the parties, or such of them as should require the same, on or before 13 July 1839. On 11 July 1839 the umpire made and executed his award, in the presence of and attested by two witnesses to whom it was fully made known and declared at the time of its execution. At 10 a.m. on 12 July the plaintiff died, but this fact was unknown to the umpire and the attorneys of the parties when during the afternoon of that day they received a letter from the umpire inviting them to attend at his office at 5.30 p.m. This they did and he read over to them and declared his award.
It will be seen that on these facts there were three possible moments when it could be said that the award was made and published, namely upon the signature before witnesses to whom it was fully made known, upon the sending of the letter to the attorneys saying that the umpire was about to make his award and when the umpire met the attorneys and read over to them and declared his award.
The case is of considerable interest and relevance, but is not decisive for two reasons. The first is that it was a decision of the Court of Exchequer and so is not binding upon this court. The second is that the Convention and the Act giving effect to it do not fall to be construed in the light of the English law of arbitration, in so far as it may have its own peculiarities. Nevertheless the ratio decidendi seems to me to be sound and applicable. It was put this way:
I am of opinion that this award was sufficiently published, for the purpose of making it valid, in the lifetime of the plaintiff. For that purpose it is only necessary that the act should be complete, so far as the arbitrator is concerned; that he should have done some act whereby he became functus officio and has declared his final mind: per Parke B., at p. 476.
I apprehend that the meaning of the publication, in the rule which regulates the time for an application to set aside an award, is not the publication of the award itself, but, by analogy to the statute, publication to the parties, i.e. when they have notice of its contents, and are therefore in a situation to move to set it aside. But on the terms of this submission, the award is made and published, when the arbitrator, by some act, has expressed his final [*571] determination on the matters referred to him: per Alderson B., at p. 478.
After the execution of the award, and its having been read over to the witnesses, there was as complete a publication of it as could be; the umpire could not afterwards revoke or alter it; and it was then ready to be delivered: per Gurney B., at p. 478.
It may be said that the court was there concerned with the double condition of made and published, whereas we are only concerned with made. Nevertheless I would accept that what we have to look for is the first point of time at which the arbitrators award could not be revoked or altered (perGurney B.), the arbitrator has expressed his final determination (per Alderson B.) and is functus officio: per Parke B. On the facts of that case the ceremony which involved the execution of the award in the presence of two witnesses to whom it was fully made known and declared served the double purpose of showing that the umpire regarded himself as functus officio and publishing the award. We only have to determine when Mr. MacCrindle could reasonably be regarded as having become functus officio, as being no longer able to revoke or vary his award and as having expressed his final determination.
I regard it as so unlikely that Mr. MacCrindle fully made known his award and declared it to his secretaryshe would have been bored to tearsthat I should require evidence that this took place. Clearly what she was doing was witnessing his signature. Thereafter the award was in the custody of Mr. MacCrindle, or the Post Office or his clerk until it was delivered to one of the parties. I accept that he could not have revoked or varied his award once his clerk had notified the parties that it was ready for collection, but quite clearly he could have done so at any earlier time.
One of the mysteries of this case is why Mr. MacCrindle ever included a statement in the award that it was dated in Paris. He had only to sign it and the problem would never have arisen. But he did. So I have to balance the fact that since he did not in fact revoke or vary the award once he had signed and dated it in Paris against the fact that he only became functus officio when he put it out of his power to do so by issuing a notification in London informing the parties that the award was ready for collection.
With very considerable doubts I have concluded that where an award states that it is dated or signed in a particular place, that is the place where it had been made. If no such statement is included, it should be taken to be made in the place where it is made available to the parties or from which it is sent to the parties. In no circumstances should it be necessary, and it cannot have been contemplated by the Convention, that there should be a factual inquiry by the enforcing court as to where an award was signed if this does not appear on the face of the award.
I therefore conclude that this was a Convention award.
It is an interesting, but irrelevant, thought that for an arbitrator to make an award in Paris when the terms of reference require that the arbitration, which must include the award, shall take place in London may very well constitute technical misconduct which would justify setting [*572] it aside under section 23 of the Arbitration Act 1950 or a procedural mishap justifying remission under section 22. In saying this I do not mean to suggest that the place where Mr. MacCrindle was when he appended his signature to the award has any significance. He may in fact have been on a aeroplane in mid-Atlantic. I mentioned in argument that I signified my concurrence as Master of the Rolls to the Solicitors Indemnity Rules 1984 by signing a copy in Anchorage, Alaska, but advisedly refrained from recording this fact lest it raise jurisdictional problems. It was the fact that Mr. MacCrindle declared in the award itself that it was dated in Paris which is significant and which alone could turn it into a Convention award as contrasted with an English domestic award. This transformation was something to which the parties never agreed and probably never contemplated.
I say that this thought is irrelevant for two reasons. First because if the English court is still free to exercise its supervisory jurisdiction, which falls to be considered hereafter, there is no need to set the award aside in order that a new domestic award may be made and if the English court is not free to exercise that jurisdiction, it cannot set it aside anyway. Second because it has not been contended on behalf of Mr. Hiscox that the award should not be enforced, giving that word the extended meaning contemplated by section 3(2) of the Act of 1975, because the arbitral procedure was not in accordance with the agreement of the parties: see section 5(2)(e).
Can the applications under the Arbitration Acts 1950 and 1979 be entertained?
Mr. Sumption says No and his argument goes like this. (1) Under section 3(1) of the Act of 1975, a Convention award shall, subject to the following provisions of this Act, be enforceable. (2) Under section 3(2):
Any Convention award which would be enforceable under this Act shall be treated as binding for all purposes on the persons as between whom it was made, and may accordingly be relied on by any of those persons by way of defence, set-off or otherwise in any legal proceedings in the United Kingdom; and any reference in this Act to enforcing a Convention award shall be construed as including references to relying on such an award. (My emphasis.)
(3) Under section 5(1) Enforcement of a Convention award shall not be refused except in the cases mentioned in this section and since enforcement includes reliance, subject to the exceptions contained in section 5, a Convention award is a defence to any claim to relief, other than enforcement, in legal proceedings under the Arbitration Acts 1950 and 1979. (4) Under section 5(2)(f) it is a ground for refusing to enforce a Convention award:
that the award has not yet become binding on the parties, or has been set aside or suspended by a competent authority of the country in which, or under the law of which, it was made. (My emphasis.) [*573]
The award became binding at the latest as soon as it was notified to the parties and before Mr. Hiscox initiated his proceedings. It has not been set aside or suspended by any competent authority either in this county (under whose law the arbitration was conducted and the award made) or in France if, by the laws of France, the French courts are a competent authority in respect of an award made in France. (5) Under section 5(5):
where an application for the setting aside or suspension of a Convention award has been made to such a competent authority as is mentioned in subsection (2)(f) of this section, the court before which enforcement of the award is sought [or in which the award is relied upon (see section 3(2))] may, if it thinks fit, adjourn the proceedings . . . .
(6) The only options open to Hirst J. were to adjourn the Acts of 1950 and 1979 proceedings indefinitely, since the position would never change, or dismiss the proceedings.
As is so often the case with Mr. Sumptions superbly crafted arguments, its simplicity and apparently irresistible logic amount to forensic prestidigitation. My admiration for the performance is unqualified, but I resolutely refuse to be beguiled by it.
Where enforcement is sought in one Convention country and an application is made to the competent authority in another Convention country to set the award aside or to suspend it, there is an obvious risk that the enforcing court may overtake the competent authority in their respective dealings with the award. Hence section 5(5) of the Act (and article VI of the Convention) which empowers the enforcing court to stay its hand in order to enable the competent authority to discharge its duties in relation to the award.
If in this case enforcement had been sought in Germany, there would have been no problem so far as the German court was concerned. It would have been faced with an award in respect of which applications had been to the English courts, as the competent authority, to set aside or suspend the award. It would then have had to consider adjourning the enforcement proceedings under the equivalent in German law of section 5(5). In saying this I appreciate that none of the three applications made by Mr. Hiscox mentions setting aside or suspension. If the Convention had been tailored to meet the particular terminology of any one country, and in particular of this country, it may be that different terminology would have been used in section 5(2)(f) and article V(1)(e). But in the context of an international Convention and an Act giving effect to it, what matters is not the technical terminology used in a national court, but the nature of the relief for which application has been made.
In the case of an application for leave to appeal, what is being sought is an appeal leading to a variation, setting aside or remission of the award: see section 1(2) of the Act of 1979. A variation involves a partial setting aside. A remission involves a total setting aside, because the award remitted has no validity unless and until it is confirmed by the [*574] arbitrator at a later date and so becomes to that extent a different award. In most cases he will make a new award in different terms.
In the case of an application for further reasons, the basis is that these are required for the purposes of an appeal (see section 1(5)(b) of the Act of 1979) and will not be entertained in any other circumstances. It is ancillary to an appeal and similar considerations apply.
In the case of remission under section 22, as in the case of remission on an appeal, the award is set aside.
In all three cases the making of the application itself produces a de facto suspension of a non-Convention award, because the court will not allow an award to be enforced under section 26 or by action on the award whilst such applications are pending. Under other systems of law, it may well be necessary to couple an application to the competent authority for the exercise of its jurisdiction to make a final order suspending or setting the award aside with an application to suspend the award meanwhile, but that is not necessary in this jurisdiction.
On the argument as it was advanced by Mr. Sumption in this appeal, a problem only arises where, as in this case, the competent authority is also the enforcing court. But if Mr. Sumptions submissions are correct, no competent authority in any Convention country could ever set aside or suspend a Convention award, even if the award were being enforced in the normal sense of the word in another Convention country, e.g. Germany. As soon as an application was made for this purpose to the competent authority in another Convention country, e.g. France or the United Kingdom, that application would be met with the answer that the court was also an enforcing court in the sense that it was required to allow the award to be relied upon in any proceedings including those proceedings (see section 3(2) giving effect to article III of the Convention or the local equivalent of that subsection) and accordingly could only adjourn the application. This makes nonsense of the role of the competent authority as contemplated by the Convention and leaves the award and arbitration entirely unsupervised.
The answer lies in treating a court which is, or is sought to be treated as, both the competent authority and an enforcing court as two separate courts with the judges wearing two different hats, or wigs. The Convention then works as it was intended to do. I accept that this may be stigmatised as giving the Act of 1975 a purposive construction, but this is permissible and indeed necessary when construing a statute giving effect to an international Convention intended to be applied consistently in different jurisdictions. Put in another way, I do not accept that the authors of the Convention or Parliament could or did intend to achieve the result which flows from Mr. Sumptions submission and I do not think that the wording of the Act compels us to achieve it.
In Amalgamated Investment & Property Co. Ltd. v. Texas Commerce International Bank Ltd.  Q.B. 84, 122, Lord Denning M.R. summarised the modern law on estoppel by convention as follows:
The doctrine of estoppel is one of the most flexible and useful in the armoury of the law. But it has become overloaded with cases. [*575]
That is why I have not gone through them all in this judgment. It has evolved during the last 150 years in a sequence of separate developments: proprietary estoppel, estoppel by representation of fact, estoppel by acquiescence, and promissory estoppel. At the same time it has been sought to be limited by a series of maxims: estoppel is only a rule of evidence, estoppel cannot give rise to a cause of action, estoppel cannot do away with the need for consideration, and so forth. All these can now be seen to merge into one general principle shorn of limitations. When the parties to a transaction proceed on the basis of an underlying assumptioneither of fact or of lawwhether due to misrepresentation or mistake makes no differenceon which they have conducted the dealings between themneither of them will be allowed to go back on that assumption when it would be unfair or unjust to allow him to do so. If one of them does seek to go back on it, the courts will give the other such remedy as the equity of the case demands.
In the same case Eveleigh L.J., at p. 126, and Brandon L.J., at pp. 130-131, approved the following passage from Spencer Bower and Turner, Estoppel by Representation, 3rd ed. (1977), at p. 157:
This form of estoppel is founded, not on a representation of fact made by a representor and believed by a representee, but on an agreed statement of facts the truth of which has been assumed, by the convention of the parties, as the basis of a transaction into which they are about to enter. When the parties have acted in their transaction upon the agreed assumption that a given state of facts is to be accepted between them as true, then as regards that transaction each will be estopped against the other from questioning the truth from the statement of facts so assumed.
In Norwegian American Cruises A/S v. Paul Mundy Ltd.  2 Lloyds Rep. 343, Bingham L.J., with the agreement of Taylor L.J., approved a passage in a judgment of Peter Gibson J. in Hamel-Smith v. Pycroft Jetsave Ltd. (unreported), 5 February 1987, from which he quoted at length: see pp. 351-352. In so doing he was approving criticisms of this passage in Spencer Bower and Turner, Estoppel by Representation, 3rd ed., p. 157. For present purposes all that need be said is that his judgment is authority for the proposition that estoppel by convention is not confined to an agreed assumption as to fact, but may be as to law (see p. 351), that the court will give effect to the agreed assumption only if it would be unconscionable not to do so and that, once a common assumption is revealed to be erroneous, the estoppel will not apply to future dealings.
In this case the exchange of letters between solicitors on 3 and 6 August 1990 in relation to the draft award shows quite clearly that both parties assumed that the fact that an award was Dated at Paris was no obstacle to the exercise by the English courts of their supervisory jurisdiction under the Arbitration Acts 1950 and 1979. Furthermore, as [*576] Mr. Klimt of Messrs. Fishburn Boxer pointed out in an affidavit sworn on 15 February 1991, and as is indeed obvious:
If following receipt of Mr. MacCrindles initial draft award on 6 August 1990also signed in Parisit had in any way been suggested by the respondent that it might not be subject to the 1950 Act or 1979 Act supervising jurisdiction of the English courts, my firm would have advised the claimant to request Mr. MacCrindle to re-issue his award signed in London. Certainly if this had not been done and the respondent had then or at any later time indicated that a jurisdiction point was to be taken the applicant would have been advised to have that issue resolved by the court as a preliminary issue before incurring further expense in further preparing the applications now about to be heard.
The assumption was never questioned at the time when the present award was still only in draft form and an amendment could easily have been made. Indeed it was not questioned until after a date had been fixed for the hearing of Mr. Hiscoxs applications. This was not due to any lack of candour on the part of Mr. Outhwaite or his advisers, but arose simply from the fact that the argument which is now advanced on his behalf would be most unlikely to occur to anyone familiar with the law of arbitration, such as the authors of Mustill & Boyd, Commercial Arbitration, 2nd ed. (1989), who do not seem to have thought of it either: see pp. 89-91. The authors are, if I may say so, no slouches when it comes to uncovering new aspects of the law of arbitration. It was their discovery of an undetected loophole in section 10 of the Act of 1950 (the power of the court in certain cases to appoint an arbitrator or umpire) and the attention which they drew to it in the first edition which created a situation in which the Act had to be amended as a matter of urgency: see section 58 of the Administration of Justice Act 1985. The only cause for surprise is that it has been thought of at all. On the basis of this common assumption Mr. Hiscox incurred costs in preparing for the hearing of his applications under the Acts of 1950 and 1979 before he learnt that his right to make this was being challenged.
Mr. Sumptions answer to this reliance upon an estoppel is in two parts. It begins with the proposition that the parties cannot confer on the court by estoppel a jurisdiction which the court does not have by statute and whose exercise would be contrary to the mandatory provisions of the Act of 1975: see Wilkinson v. Barking Corporation  1 K.B. 721, 725, per Asquith L.J. and Halsburys Laws of England, 4th ed., vol. 10 (1975), p. 326, para. 718, vol. 16 (1976), p. 1008, para. 1501, n. 3. So be it, but the court has the jurisdiction under the Acts of 1950 and 1979 and the only question is whether the provisions of the Act of 1975 prevent it exercising that jurisdiction. If, contrary to my view, it does so, this is only because the award, like the award on liability and the draft award, was made in Paris and is a Convention award having that consequence. It was quite clearly the assumption of the parties that either this was not in fact or law a Convention award or that, if it was, there was no impediment under the [*577] Act of 1975 or otherwise to the exercise of the courts jurisdiction under the Act of 1950 and 1979.
Mr. Sumptions second answer was that if, as Hirst J. had held, no question of jurisdiction was involved but what was being put forward was a blanket defence to the claims under the Acts of 1950 and 1979, the common assumption that the applications could be made within a particular time scale was not inconsistent with there being such a defence and that no party is under any legal or equitable obligation to give advance notice of any defence which they intend to advance.
Whilst it is quite true that in general there is no obligation to disclose defences, this is not the case where there has been a common assumption that the defence is not available and one or other or both parties have acted on that assumption. In my judgment it would be unconscionable now to allow Mr. Outhwaite to renege from the common assumption which extended not only to the fact that applications under the Acts of 1950 and 1979 could be made within a specified time, but by necessary implication that in respect of an award which stated on its face that it was Dated at Paris such applications could and would be heard and determined on their merits. In relation to any future awards the position will, of course, be different.
I would dismiss the appeal.
McCOWAN L.J. The Arbitration Act 1975 is an Act to give effect to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards. By section 7(1) of the Act a Convention award is defined as:
an award made in pursuance of an arbitration agreement in the territory of a state, other than the United Kingdom, which is a party to the New York Convention.
In the present case Hirst J. held that the award was not made in Paris, where the arbitrator signed it, but in England, which was, he said, the central point of the arbitration proceedings. To hold otherwise, he said, would lead to absurd results.
The Act being designed to give effect to the Convention, and there being ambiguity as to where an award is made, our attention has properly been drawn to the travaux préparatoires. From these it is plain that a great deal of thought and debate was devoted to this issue and a conscious and deliberate decision was reached, after weighing the arguments for and against, in favour of defining a Convention award in terms of where the award was made as opposed to anywhere else, including where the arbitration took place. They recognised that that might work capriciously, but they felt that this disadvantage was outweighed by the advantages of simplicity and consistency.
That view having been reached by the Convention, and the Act of 1975 being an Act to give effect to the Convention, it is not for our courts to overturn it on the ground that it produces absurd results. It is to be noted, moreover, that the draftsman of the Act (no doubt to give effect to the Convention) made a clear distinction between where the arbitration took place (section 5(2)(e)) and in which . . . it [the [*578] award] was made: section 5(2)(f). He was, therefore, capable of saying where the arbitration took place when he chose, but in fact chose not to in section 5(2)(f).
A further argument is, however, advanced by Mr. Coleman for the claimant that the award was made, not in Paris where the arbitrator signed it, but in London where the award was published to the parties. Till that moment, submits Mr. Coleman, he could have changed his mind and hence was not functus officio.
I am unable to accept this argument. In Brooke v. Mitchell, 6 M. & W. 473, 476, Parke B. said:
it is only necessary that the act should be complete, so far as the arbitrator is concerned; that he should have done some act whereby he becomes functus officio, and has declared his final mind.
I see nothing to suggest in the present case that the arbitrator had not declared his final mind from the moment he put his conclusions in a formal document and signed it in front of a witness. Publication to the parties was not necessary to the validity of the award. Indeed, as Mr. Sumption pointed out, the place where the parties were notified of the award could be even more capricious than where the award was signed: suppose for example, the arbitrator sent notice to one party in the United States and to another in Italy, where would the award be made?
Accordingly, I am of the view that this was a Convention award within the terms of section 7(1) of the Act. The effect of this is set out in section 3:
(1) A Convention award shall, subject to the following provisions of this Act, be enforceable(a) in England and Wales, either by action or in the same manner as the award of an arbitrator is enforceable by virtue of section 26 of the Arbitration Act 1950; . . . (2) Any Convention award which would be enforceable under this Act shall be treated as binding for all purposes on the persons as between whom it was made, and may accordingly be relied on by any of those persons by way of defence, set off or otherwise in any legal proceedings in the United Kingdom; and any reference in this Act to enforcing a Convention award shall be construed as including references to relying on such an award.
Section 5 deals with refusal of enforcement as follows:
(1) Enforcement of a Convention award shall not be refused except in the cases mentioned in this section. (2) Enforcement of a Convention award may be refused if the person against whom it is invoked proves. . . (f) that the award has not yet become binding on the parties, or has been set aside or suspended by a competent authority of the country in which, or under the law of which, it was made. . . . (5) Where an application for the setting aside or suspension of a Convention award has been made to such a competent authority as is mentioned in subsection (2)(f) of this section, the court before which enforcement of the award is sought may, if it thinks fit, adjourn the proceedings and may, on the [*579] application of the party seeking to enforce the award, order the other party to give security.
The proceedings before Hirst J. were brought by the claimant and consisted of: (a) a summons for leave to appeal under section 1(3)(b) of the Arbitration Act 1979; (b) an originating summons for an order directing the arbitrator to state further reasons pursuant to section 1(5) of the Arbitration Act 1979; (c) a notice of originating motion seeking the remission of the award to the arbitrator under section 22 of the Arbitration Act 1950.
The respondent to the arbitration argues that the courts of this country cannot entertain these applications. It is the respondent, therefore, who is relying on the Convention award by way of a defence, and the claimant who is obliged to rely on section 5(2)(f) in order to defeat that reliance. There are three ways under that subsection in which he might do that. He might show: (1) that the award has not yet become binding on the parties; or (2) that the award has been set aside by a competent authority of the country in which, or under the law of which, it was made; or (3) that the award has been suspended by such a competent authority.
By section 3(2) of the Act, however, the award has to be treated as binding for all purposes on the persons as between whom it was made; and as a matter of fact the award has not been set aside or suspended. In consequence, in my judgment, the claimant is unable to bring himself within section 5(2)(f).
Mr. Coleman next argues, however, that the claimant can rely on section 5(5). Mr. Coleman submits that Hirst J. would be entitled under this subsection to adjourn the respondents defence, which Mr. Coleman terms the proceedings, while allowing the claimants proceedings to continue. I cannot, I am afraid, accept this as a possible interpretation of the subsection. What is meant by the proceedings is, in my judgment, those which were brought by the claimant. But in any event the proceedings can only be adjourned where an application has been made for the setting aside or suspension of the award, and in this case no such application has been made. I agree with Mr. Sumptions submission that section 5(5) is subsidiary to section 5(2)(f), and that its purpose is to enable the competent authority to catch up.
For all these reasons I conclude that the plain words of the Act of 1975 lead to the conclusion that the respondents arguments on this aspect of the case must succeed. The results may be unsatisfactory and regrettable, but short of further legislation there is nothing, in my judgment, which the courts can do about it.
On the issue of estoppel by convention, however I find myself in complete agreement with Lord Donaldson of Lymington M.R. and cannot usefully add anything to what he has said. On this ground, therefore, I would dismiss the appeal.
The nature of the award
Section 7(1) of the Arbitration Act 1975 defines Convention award as meaning for purposes of the Act an award made in [*580] pursuance of an arbitration agreement in the territory of a state, other than the United Kingdom, which is a party to the New York Convention. Mr. Coleman submits that the award was not made in Paris: it was made in London where(i) all the hearings took place and where the parties were domiciled; (ii) it was published to the parties; (iii) the seat or centre of gravity of the arbitration was located. Hirst J. accepted this submission saying:
In my judgment, in construing the vital words of the Act of 1975, it is crucial to bear in mind that an award is not an isolated event, but rather the culminating stage in a process of arbitration which has passed through a number of earlier phases, from which in my judgment it cannot properly be divorced.
He considered that it would be highly unreasonable if an award could be capriciously transferred simply and solely as a result of the fortuitous circumstance of the place of signature of the award. He adopted as cogent and persuasive the article by Dr. Mann, which Lord Donaldson of Lymington M.R. has cited, and held that in order to decide where an award is made, one must look at the arbitration as a whole, and not just at the place of signature, and the proper criterion is the central point of the arbitration proceedings. The judge accordingly rejected as absurd the result that the award was made in France.
In an article in Pace Law Review, vol. 6 (1985), p. 45, Dr. van den Berg has asserted:
The place of arbitration in the legal sense (also called seat of arbitration') means that the arbitration law of the country where the arbitration takes place governs the arbitration [and that it is that place] which must be mentioned in the arbitral award as the place where the award is made.
No support is quoted for this theory, and the very fact that an arbitrator so experienced as Mr. MacCrindle elected to state that the award was made where he signed or executed it shows that Dr. van den Bergs theory is, to say the least, not universally applied. To me the term made simply does not mean created at the arbitral seat: it means effected, or executed. The term signed may have been eschewed because, although an award may have to be signed by each of three arbitrators, it is not complete until the last of them affixes his signature.
In Brooke v. Mitchell, 6 M. & W. 473 the court held that an award is made and published,' when the arbitrator, by some act, has expressed his final determination on the matters referred to him, per Alderson B., at p. 478; and that the instrument was complete as an award, and the umpire could make no alteration in it, after the execution of it; he was then functus officio, having declared his final mind, per Parke B., at p. 477. That happened here when the arbitrator signed in Paris the award, of which copies were afterwards made available to the parties.
I do not understand what the judge had in mind when he said an award is not an isolated event, but rather the culminating stage in a [*581] process of arbitration . . . from which . . . it cannot properly be divorced. An award is not an event: it is only a culminating stage in the sense that it could not be produced without reference to and through the medium of evidence previously tendered. Of course it cannot be divorced from the arbitration because it represents the conclusion of it. But it is with the making, not the evolution, of the award that the Act is concerned, and that has nothing to do with where the arbitration takes place. In section 5(2) of the Act the two contrasting formulae are used: the law of the country where the award was made (paragraph (b)) and the law of the country where the arbitration took place: paragraph (e). It is obvious that the one may be different from the other.
From the moment of execution of an award it has all the legal attributes of an award; and it has them irrespective of the knowledge of the parties. The travaux préparatoires support the construction for which Mr. Sumption contendsthat although the test is mechanical, it was adopted as being precise, and not susceptible to any real difference of approach between the courts of different countries. The test of where the award was made was chosen as affording what the United Kingdom delegate called an objective and easily applicable criterion. I accept Mr. Sumptions submission that the disadvantages of an occasional capricious solution are outweighed by the advantages of simplicity and consistency.
In this case the award was executed in France. The arbitrator began by saying: Now I . . . do hereby make and publish this my interim award. In my judgment that correctly describes what happened. It therefore is a Convention award.
The effect of the award
Article III of the Convention provides, so far as material:
Each contracting state shall recognise arbitral awards as binding and enforce them in accordance with the rules of procedure of the territory where the award is relied upon under the conditions laid down in the following articles. . . .
Translated into the Act, the formula used in section 3(2) is exactly the same as in section 36(2) of the Arbitration Act 1950 in relation to a foreign award:
Any Convention award which would be enforceable under this Act shall be treated as binding for all purposes on the persons as between whom it was made, and may accordingly be relied on by any of those persons by way of defence, set off or otherwise in any legal proceedings in the United Kingdom; and any reference in this Act to enforcing a Convention award shall be construed as including references to relying on such an award.
It is the phrase any legal proceedings that enables Mr. Sumption to argue that the award can be relied on by way of defence to applications made by Mr. Hiscox in respect of the award. But for this, the dichotomy would have been clear between enforcement proceedings [*582] and other legal proceedings. Sections 3 to 6 of the Act are expressed by section 2 to have effect with respect to the enforcement of Convention awards. It would, I suppose, be possible to argue (though Mr. Coleman did not do so) that section 3(2) should therefore be confined in its application to the enforcement of Convention awards; but that is difficult to reconcile with the phrases for all purposes and in any legal proceedings. It is plain that sections 4 to 6 have no purpose except to control enforcement proceedings. Section 5(2)(f) envisages that before enforcement is attempted the courts of the country in which, or under the law of which, the award was made may suspend it or set it aside. Section 5(5) gives power to the enforcing court to adjourn pending proceedings for the setting aside or suspension of the award. These latter subsections contemplate that in the present case the courts of France and England respectively will or may have power to set aside or suspend; that that power may have been exercised before enforcement proceedings are brought here; and that if they are brought here they may be adjourned.
Mr. Sumption argues that by force of the words has been in section 5(2)(f) the English courts task is confined to granting or withholding enforcement, once the award has been classified as a Convention award. Section 5(2) is concerned with the legal status of the award as issued or the agreement or procedure which led to it: none of the paragraphs in the subsection is concerned with re-opening the award on its merits. According to Mr. Sumptions argument, since section 5 does not confer any jurisdiction, as soon as it has been ascertained that the award has become binding (as it clearly has), and has not been set aside or suspended (as it clearly has not), the court has no power to adjourn enforcement proceedings. Section 5(5) does not apply to a case where an English court is both the enforcing court and the court to which an application is made to adjourn the award or set it aside. The subsection is merely ancillary to section 5(2)(f), which assumes that when the matter is first before an English court there has already been an order suspending it or setting it aside.
Mr. Sumption remarks that if the English court could apply its own curial law, it would be exercising the right to do what was proposed by the eight-power amendment to the Convention, and rejected. That would have applied the Convention to the enforcement of awards other than those considered as domestic in the country in which they are relied upon.
Mr. Sumptions construction precludes the curial court from intervening if it is itself the enforcing court. He argues that it is appropriate that, whether its rights are limited or not, the curial court should not be able to exercise any supervisory jurisdiction in relation to a Convention award. In such a case, the Act is designed to limit the objections to enforcement to those specified in the Act itself. Because the award was not made here, it is the decisions of a foreign court that the enforcing court is empowered to consider. This produces the result, according to Mr. Sumption, that the English court can only exercise jurisdiction in relation to an award of a country outside the [*583] Convention. It is, however, not necessarily under the law of a foreign country that the award was made.
Lord Donaldson of Lymington M.R. has described how he would reconcile the enforcing and supervisory jurisdictions of the English court. It would be a sensible solution. But unfortunately he gives no indication of how this result could be achieved by way of interpretation of the Act.
The result of the rival arguments is either that the English court cannot do anything to a Convention award except enforce it or that the English court retains all its powers to interfere with such an award before considering enforcement. The latter result is achieved by adopting what is termed a purposive approach. It involves treating any legal proceedings in section 3(2) as meaning any enforcement proceedings.
Having anxiously considered this dilemma I do not feel able to construe the Act so as to preserve a locus for the English court when acting in its supervisory capacity. By definition a Convention award means an arbitration award made abroad. The Act does not envisage that the award will be subject to the supervisory jurisdiction of the English court. It follows that section 5(2)(f) is worded as one would expect it to be, not contemplating that the English court will be the competent authority. It only could be the competent authority if the award, though made abroad, were made under English law. In practice an adjournment under section 5(5) of enforcement proceedings would be of no avail, because no application to the English court for the setting aside or suspension of a Convention award could be successful in face of section 3(2), if that subsection means what it says. For the purposive argument to succeed, in section 3(2) any legal proceedings would have to be construed as meaning either any legal proceedings other than proceedings to set aside or suspend or any proceedings for the enforcement of a Convention award. As to the former, no such limitation is warranted by the language used. As to the latter, the provision about reliance is needed not merely in the context of enforcement but for the protection, for example, of a defendant who is sued here on a cause of action already determined in his favour by means of a Convention award.
Because the language of section 3(2) is wide and unconfined, I see no escape from the conclusion that it can be relied on outside the realm of enforcement to meet all proceedings, including proceedings to set aside or suspend the award.
Mr. Coleman argued that Mr. Outhwaite is estopped from contending that Mr. Hiscox cannot pursue his applications because the award is a Convention award. Hirst J. held that Mr. Coleman was in all respects correct in submitting that this was a classic case of estoppel by convention. It was common ground throughout that the award was subject to the English Arbitration Acts; Mr. Outhwaite knew that Mr. Hiscox thought that it was; and Mr. Hiscox relied on this common assumption, with the result that it would be unconscionable to [*584] allow Mr. Outhwaite to claim that the Acts do not apply. That nobody had thought of the point now relied on by Mr. Outhwaite until shortly before the hearing before Hirst J. is obvious from the affidavit of Mr. Hiscoxs solicitor, Mr. Klimt, and is accepted by Mr. Sumption.
The relevant law is conveniently summarised in the passages cited by Lord Donaldson of Lymington M.R. from Amalgamated Investment & Property Co. Ltd. v. Texas Commerce International Bank Ltd.  Q.B. 84, 122. In that case Lord Denning M.R. also said, at p. 121:
If parties to a contract, by their course of dealing, put a particular interpretation on the terms of iton the faith of which each of themto the knowledge of the otheracts and conducts their mutual affairsthey are bound by that interpretation just as much as if they had written it down as being a variation of the contract. There is no need to inquire whether their particular interpretation is correct or notor whether they were mistaken or notor whether they had in mind the original terms or not. Suffice it that they have, by the course of dealing, put their own interpretation on their contract, and cannot be allowed to go back on it.
And he added:
They are bound by the conventional basis on which they conducted their affairs. The reason is because it would be altogether unjust to allow either party to insist on the strict interpretation of the original terms of the contractwhen it would be inequitable to do so, having regard to dealings which have taken place between the parties.
Mr. Sumption submits that there was no representation by Mr. Outhwaite on which Mr. Hiscox can be said to have acted. True it is that both parties assumed that English law applied as the curial law, but that told nothing about what law would apply if the award were not signed in this country. The plea that the award was a Convention award may be regarded as matter of defence: if so, Mr. Outhwaite never undertook not to take advantage of it. Alternatively, if it be regarded as going to jurisdiction, the parties cannot have achieved the result that the award is not a Convention award merely by assuming that it would not be executed in Paris.
There can have been no question of the parties assuming that the award was not a Convention award, because the fact that it is, or might be said to be, had not crossed their minds. By the same token it cannot sensibly be suggested that it was common ground that because the arbitration was a domestic arbitration the courts supervisory jurisdiction would be unimpaired. Mr. Outhwaite and his advisers never encouraged Mr. Hiscox or his advisers to pursue a remedy in the English courts or to believe that if he did so no jurisdictional objection would be taken. Still less did they represent that the fact that the award was expressed to be Dated at Paris [*585] would have, or would not have, any particular effect on the courts jurisdiction to entertain Mr. Hiscoxs applications. Neither party took any view, or formed any apprehension, about the effect on the award of its having been made in Paris. There was therefore no basis for the establishment of a convention between them about the consequences of the fact that it was so made. By analogy, I cannot see how the fact that parties fail to realise that a defendant can in the circumstances avail himself of a limitation defence, will preclude the defendant from doing so in due time. In short, there was here no common assumption about the effect of the award having been made in France: there was a mutual failure to appreciate that that fact was material and why it was. I therefore do not consider that Mr. Hiscox can by raising an estoppel prevent the award from having effect as a Convention award.
I would allow the appeal.
Appeal dismissed with costs.
Leave to appeal.
APPEAL from the Court of Appeal.
By leave of the Court of Appeal the appellant, Richard Henry Moffit Outhwaite (the respondent to the arbitration proceedings), on behalf of himself and all other members of syndicate 661 at Lloyds, appealed.
The facts are stated in the opinion of Lord Oliver of Aylmerton.
[LORD MACKAY OF CLASHFERN L.C. On all the issues save that of estoppel the respondent in fact is the appellant and therefore the respondent is invited to open the appeal.]
Anthony Coleman Q.C., Jonathan Gillman Q.C. and John Lockey for the respondent. On the issue whether the award was made in Paris or in London, the respondent relies on two alternative propositions. (i) An award is made in the country in which the arbitration has its legal seat: the legal seat of this award was England. (ii) If it is impermissible to have regard to the legal seat of the award, the award is made in the place where the arbitrator finally puts it out of his power to revoke it, namely England, where it was tendered to the parties.
In the absence of some express provision to the contrary in the agreement to arbitrate, it is the law of the legal seat of the arbitration (the curial law) which governs the conduct of an arbitration prior to the award: Naviera Amazonica Peruana S.A. v. Compania Internacional de Seguros del Peru  1 Lloyds Rep. 116, 119, per Kerr L.J.
The mere signature of an award in a country other than that of the curial law cannot mean that the award is not made in accordance with that law. Where an award is made is irrelevant. The curial law of the present arbitration was plainly English law, and the powers of the [*586] Commercial Court pursuant to the Arbitration Acts 1950 and 1979 in relation to the conduct of the pending reference was thus exercisable throughout the duration of the reference, at least until the making of the award. [Reference was made to sections 2, 3, 5, 7 of the Arbitration Act 1975 and section 3 of the Arbitration Act 1979.]
It is important to distinguish between the proper law of the arbitration and the curial law of the arbitration. In respect of a Convention award the respondent relies on the words which would be enforceable in section 3(2) of the Arbitration Act 1975. There is there a hypothesis which relates to the provisions in section 4 and section 5(1) (2) (4) and (5). In the Act a Convention award means an award made in the place of the legal seat of the arbitration. The legal seat of the arbitration is readily ascertainable from the outset of the arbitration and is a test already known to English arbitration law. This view is supported by the leading commentators on international arbitration: see Dr. F.A. Mann Arbitration International, vol. 1 (1985), p. 107; Dr. van den Berg, (1985) 6 Pace L.R. 25, 44-46; Arbitration International, vol. 2 (1986), pp. 191, 202; Steyn J. and Mr. Veeder Q.C. in International Handbook on Commercial Arbitration, vol. 1, supplement 9 (1988) and Redfern and Hunter, International Commercial Arbitration, 1st ed. (1986), p. 70.
The New York Convention of 1958, to which effect is given by the Act of 1975, should be construed in the light of article 31 of the Vienna Convention on the Interpretation of Treaties: see Fothergill v. Monarch Airlines Ltd.  A.C. 251, 281, 282. The object and purpose of the New York Convention was to improve the system of international recognition and enforcement of commercial arbitration awards: see, generally, the Fifth Report of the Private International Law Committee, 1961 (Cmnd. 1515).
It is of paramount importance that parties should be in a position to know from the outset of the reference to arbitration whether the award which will ultimately be made will be a Convention award subject to the special regime for international recognition and enforcement. [Reference was made to paragraphs 12 to 16 of the Fifth Report.] The result of the judgment of the Court of Appeal is to permit an award in an arbitration which has been subject to the supervision of English curial law during the entirety of the course of the proceedings to be made under an entirely different law by the unilateral act of the arbitrator (whether deliberate or fortuitous) which may ensure the awards freedom from attack under the curial law of the arbitration or which may subject the award to a greater degree of review by reference to the national law of the territory in which the award is signed. It cannot have been the purpose of the Convention to create uncertainty in relation to the law which will govern review of the award until the time when the award is made.
As to the word made, the travaux préparatoires relied on by McCowan L.J. and Lord Donaldson of Lymington M.R. are of no real assistance. If made is given the very restricted meaning contended for by the appellant it entails applying to an award a system of law with which it has no relevance. [*587]
The award was made in England because it was tendered in England by someone acting on behalf of the arbitrator. Also, an award is made at the time and place when it is no longer possible for the arbitrator to alter the award. Accordingly, the award was made in London. It is only then that the arbitrator becomes functus officio. The situation is analogous to that in Brooke v. Mitchell (1840) 6 M. & W. 473.
If the award is a Convention award, the effect of section 5(2)(f) and (5) of the Act of 1975 is to enable the court seised of applications of the present nature to determine them before considering if and to what extent the court should give effect to the award under section 3(2) of the Act. A Convention award whose curial law is English law and which is subject to such applications is not yet binding within the meaning of section 5(2)(f) of the Act of 1975 and is therefore not enforceable for the purposes of the Act and shall not be treated as binding under section 3(2) thereof. Section 5(5) deals with the position which arises here where applications are made to a competent authority under section 5(2)(f) for the setting aside or suspension of the award. The English court is in this case a competent authority because it is the court of the country under the law of which the arbitration took place. A competent authority may, if it thinks fit, adjourn the proceedings to enforce. In the present case, therefore, the English court does not treat the award as irrevocably binding by reason of section 3(2) when that court is seised of the applications to set aside or suspend the award. Section 5(2)(f) is equivalent to article V(1)(e) of the Convention. The Fifth Report of the Private International Law Committee, 1961, p. 32 expressly envisages the construction favoured by Lord Donaldson M.R.
The appellant contends that section 5(5) envisages that the court setting aside a Convention award is in a different jurisdiction to that in which the award was made. But the words has been in section 5(2)(f) on which reliance is placed refer only to the order of events and do not support the contention. On this issue the judgment of Lord Donaldson M.R., ante, pp. 573D-574F, is correct. It matters not that the court enforcing the award is a court of the same country as that in which the award was made.
If the award was a Convention award, enforcement of the award as a defence to the respondents applications should be refused because the award was not made in accordance with the agreement of the parties. Having regard to the wording of section 5(2)(e) the arbitral procedure was not in accordance with the agreement of the parties for the following reasons. (i) London was the legal seat of the arbitration. (ii) It was therefore impliedly agreed that English law should be the curial law: see Naviera Amazonica Peruana S.A. v. Compania Internacional de Seguros del Peru  1 Lloyds Rep. 116, 119. (iii) If English law is the curial law it applies to every stage of the arbitration including the production and the making of the award. (iv) The parties having agreed that English curial law should be applied to the making of the award, English Arbitration Act remedies, e.g., an appeal, should be available to any such award. (v) The making of an award by the arbitrator in such a way as to exclude the application of those remedies would be [*588] inconsistent with what the parties have agreed. [Reference was also made to Compagnie Européene de Céréals S.A. v. Tradax Export S.A.  2 Lloyds Rep. 301, 305 and Hiscox v. Outhwaite (No. 2)  1 W.L.R. 545.]
Jonathan Sumption Q.C. and Christopher Butcher for the appellant. It is not disputed that English law was the curial law of this arbitration and that nothing that the arbitrator did in Paris could alter the curial law.
Until the Arbitration Awards Act 1930 there was no English legislation dealing with arbitrations which had a foreign element. That Act was re-enacted as Part 2 of the Arbitration Act 1950 but Part 2 did not apply to foreign arbitration agreements governed by English law. The Arbitration Act 1975 superseded the Act of 1950 in most respects and the Act of 1950 has now a very limited application. The Act of 1975 postulates a dichotomy between the place where an award is made and the place where it is enforced. They are never the same place in respect of a Convention award.
The first question therefore is: was this a Convention award? Section 7 of the Arbitration Act 1975 is designed to exclude awards which are not Convention awards. An award is made at the time and place where the arbitrator commits himself irrevocably to a final decision. He does this by signing it. The main argument against this submission is that the court in deciding the matter should look to the legal seat of the arbitration. This was the course adopted by Hirst J. His approach was wrong.
An award is a legal instrument. It is not a sequence of events and therefore the making of an award is not a synonym for the entire course of the arbitration. Just as other stages of the arbitration may occur in different places, so there is no reason why the final stage should be tied to a particular place. There is no trace of a rule in either the Convention, the Act of 1975 or the common law that an award is made at the place which is the curial seat of the arbitration. There are strong reasons why under an Act passed pursuant to an international Convention there should not be a deemed place of making an award since the principles governing legal fictions will depend on municipal systems of law.
The main object of the Convention was to limit the grounds on which the courts of Convention countries could refuse to enforce foreign awards. This had to be done (i) with precision and (ii) on a basis common to more than 60 countries party to the Convention whose legal systems were liable to vary considerably. It is therefore necessary to define the class of awards to which the Convention applied by reference to considerations independent of the national law of any one Convention country. A definition which depended on considerations such as the domicile of one or more parties to the arbitration would be liable to be applied inconsistently from one Convention country to the next according to the differences between their domestic rules of conflict of laws.
The respondents alternative submission that an award is made where the parties receive it or are notified that it is available for collection is wrong in principle. The making of an award is not an act such as the making or acceptance of an offer whose legal effect is dependent upon communication. It is not a bilateral act but the unilateral act of the [*589] arbitrator. All that is required is that the arbitrator has declared his final mind. Whether in executing an instrument he has done so, depends on the construction of that instrument. [Reference was made to Hogg on Arbitration (1936), p. 124 and Mustill & Boyd, Commercial Arbitration, 2nd ed. (1989), pp. 382, 383.] If therefore the arbitrator died after executing his award and after his death the award was communicated to the parties, one would say that he had made his award before he died. It is usually the signing of the award which finalises the award: see Brooke v. Mitchell, 6 M & W. 473, 476. Such an award is therefore made in the place where it is signed.
As to when the slip rule can be used, see Mordue v. Palmer (1870) L.R. 6 Ch.App. 22, 30 and the judgment of Lord Denning M.R. in European Grain and Shipping Ltd. v. Johnston  Q.B. 520.
Once it is established that an award is a Convention award for the purposes of the Arbitration Act 1975, the court is bound to treat it as conclusive for all purposes unless it falls within one of the limited exceptions provided for in section 5 of the Act. It is first necessary to distinguish between the country where the award was made and the country where a person is endeavouring to enforce it. Section 7(1) of the Act of 1975 is in very wide terms. Section 3(2) is conclusive against any right of appeal. The words any legal proceedings in section 3(2) must include proceedings to set aside the award or to appeal the award.
As to the section 5 exceptions, the respondent relies mainly on section 5(2)(f), which, however, is inappropriate where a party seeks to rely on it in relation to the law of a country other than that in which the award was made. The arbitrators award was valid when made on 20 November in Paris. The relationship between section 3(2) and section 5(2) can only be determined by reference to the words any legal proceedings. [Reference was also made to section 5(5).]
Alternatively, the respondent relied on section 5(2)(e) and said that the arbitrators action in making the award in Paris was a breach of the arbitration agreement. This question must turn on the terms of the arbitration agreement. Neither the curial law nor the arbitration procedure was affected by part of the arbitration proceedings being conducted outside London. There was nothing to prevent the award being made outside London. The only basis for the respondents contention is a suggested implied term of the arbitration agreement that the Arbitration Act 1979 should apply to the arbitration, not the Act of 1975. There are no grounds for implying such a term into the arbitration agreement. Section 5(2)(e) is not concerned with procedural mishaps that do not go to the validity of the award. If the respondents are correct it would mean that there is a class of awards which are valid but not enforceable: see European Grain and Shipping Ltd. v. Johnston  Q.B. 520.
Coleman Q.C. in reply. Brooke v. Mitchell, 6 M. & W. 473 does not prevent the House from holding that the award was made in the place where it was tendered to the parties. [Reference was also made to European Grain and Shipping Ltd. v. Johnston  Q.B. 520.]
The key to the interrelationship of sections 3 and 5 of the Act of 1975 is to consider the sequence of events postulated by the sections. [*590]
There is nothing in section 5(5) which envisages two separate courts. There is no such policy to be found in the Convention because (i) the Convention includes in article II a provision inviting an enforcement court to investigate its own arbitral rules, and (ii) under article V an enforcement court may have to investigate its own arbitral law before proceeding further.
It was said that under section 5(2)(f) of the Act of 1975 the law under which the award was made must either be the law of a current Convention country or a Convention country which does not accept all the provisions of the Convention. This construction would lead to remarkable results. The Act would give effect to the curial law of the Convention country where the award was made but not to the curial law of other convention countries. The appellants argument is circular for it assumes that section 3(2) acts in a certain way.
On section 5(2)(e), when parties agree to a curial law it is for the purpose of making mutually available all the facilities to be found under the law of that place. Parties setting up an arbitration in London expect English legal remedies to be available to the parties. The question whether to enforce an award is discretionary, as shown by the use of the word shall in section 5(2)(e).
As to European Grain and Shipping Ltd. v. Johnston  Q.B. 520, the consequence of departing from the award is not to nullify the award.
Their Lordships took time for consideration.
24 July. LORD MACKAY OF CLASHFERN L.C. My Lords, I have had the advantage of reading in draft the speech prepared by my noble and learned friend, Lord Oliver of Aylmerton. I agree with it, and for the reasons which he gives I would dismiss the appeal.
LORD KEITH OF KINKEL. My Lords, I have had the advantage of considering in draft the speech to be delivered by my noble and learned friend, Lord Oliver of Aylmerton. I agree with it, and for the reasons which he gives I would dismiss the appeal.
LORD BRANDON OF OAKBROOK. My Lords, I have had the advantage of reading in draft the speech prepared by my noble and learned friend, Lord Oliver of Aylmerton. I agree with it, and for the reasons which he gives I would dismiss the appeal.
LORD ACKNER. My Lords, for the reasons given by my noble and learned friend, Lord Oliver of Aylmerton, I, too, would dismiss the appeal.
LORD OLIVER OF AYLMERTON. My Lords, the parties to this appeal are both Lloyds underwriters who represent all the members of the two syndicates of which they are respectively members. The dispute arose with regard to the liabilities of the syndicates under a contract of re-insurance entered into in 1982. That contract, which it is common [*591] ground is governed by the law of England, contained an arbitration clause providing for arbitration in London by two arbitrators and their umpire. In fact the agreement was varied by the parties who agreed to refer the dispute between them to Mr. R. A. MacCrindle Q.C. as sole arbitrator. The hearings took place in London and the arbitration was conducted in two stages, the first being concerned with the appellants contention that the agreement had been effectively rescinded. As regards that issue an award was made on 30 June 1989 when the contention was rejected. The second stage was, by agreement, limited to a determination of preliminary issues of principle relating to the quantum of claims payable by the respondent. Following hearings in London in April and May 1990, the arbitrator made a draft interim award on 6 August 1990 in the form of a number of declarations giving the parties a period of six weeks to make representations as to the form of the award. If no representations were made the award was to become binding. In fact a further hearing took place on 6 November 1990 and on 20 November 1990 the arbitrator signed his final interim award. The award made in June 1989, the draft award in August 1990 and the final interim award signed on 20 November 1990 were all signed by Mr. MacCrindle in Paris and each concluded with the words Dated at Paris, France followed by the date and Mr. MacCrindles signature, witnessed by his secretary and giving an address in Paris.
Before taking up residence in France, Mr. MacCrindle had been in practice in chambers in the Temple where he remained a door tenant for whom the clerk to the chambers performed services from time to time. On the day on which the award was signed the respondents solicitors were informed by the clerk by fax that the award was available to be taken up on payment of the balance of the charges due. Shortly after that the award was collected from the chambers.
On 10 December 1990 the respondent commenced three sets of proceedings in the Commercial Court, that is to say, an originating summons for leave to appeal to the High Court pursuant to section 1(3)(b) of the Arbitration Act 1979, a further originating summons for an order directing the arbitrator to state further reasons for his award pursuant to section 1(5) of the same Act and an originating motion seeking remission of the award pursuant to section 22 of the Arbitration Act 1950. On 28 January 1991 an order was made for all three proceedings to be heard together and a hearing took place on 15 February 1991 at which counsel for the appellant raised the preliminary point that the award was a Convention award within the meaning of section 7(1) of the Arbitration Act 1975, since it had been made in Paris, with the result that the High Court could not entertain any appeal or application for remission. On 19 February 1991 Hirst J. rejected the appellants contention, holding that, since the arbitration was an English arbitration the central point of which was in London, the award was made in London, although signed in Paris. Accordingly, the High Court had jurisdiction to entertain the respondents applications.
From this decision the appellant appealed to the Court of Appeal. That court was unanimous in rejecting the contention that the award was made in a place other than that in which it was signed and held, by [*592] a majority (Lord Donaldson of Lymington M.R. dissenting) that, since it was thus, by definition, a Convention award, the High Court would (subject to a contention as to estoppel which Hirst J. had indicated that he would have decided in the respondents favour had it been necessary for him to do so) have no jurisdiction to entertain the respondents applications. By a majority, however (Leggatt L.J. dissenting), the court held that the appellant was estopped in relation to these applications from objecting to the jurisdiction. The appeal was accordingly dismissed. The court, however, gave leave to appeal to your Lordships House on an undertaking being given by the appellant not to object to the matter being heard by the Commercial Court pending the hearing of the appeal.
Following that decision, Hirst J. on 19 March 1991 granted leave to appeal against the award on the respondents summons for that purpose. By an order of the Court of Appeal made on 25 March 1991 (see Hiscox v. Outhwaite (No. 2)  1 W.L.R. 545) it was ordered that that appeal be heard by another judge and that judgment on the appeal be in writing but be placed in a sealed envelope to be opened only in the event of this House determining that there is jurisdiction to entertain it. The present position, as I understand it, is that the respondents substantive appeal has been heard de bene esse by Evans J. and that publication of his judgment awaits the decison of this House.
By his written case the respondent seeks to uphold the judgment of Hirst J. and to contend that, even on the footing that the award is a Convention award, the High Court has (as Lord Donaldson M.R. held) jurisdiction to entertain the respondents applications. Your Lordships have accordingly heard argument on this part of the case first since, if either of the respondents arguments is accepted, the issue of estoppel upon which the appellant appeals becomes academic.
My Lords, the Arbitration Act 1975 was passed in order to give effect to the United Kingdoms obligations under the New York Arbitration Convention of 1958. Section 2 provides that: Sections 3 to 6 of this Act shall have effect with respect to the enforcement of Convention awards; . . . and section 3(1) provides that:
A Convention award shall, subject to the following provisions of this Act, be enforceable(a) in England and Wales, either by action or in the same manner as the award of an arbitrator is enforceable by virtue of section 26 of the Arbitration Act 1950 . . .
The expression Convention award is defined in section 7(1) as:
an award made in pursuance of an arbitration agreement in the territory of a State, other than the United Kingdom, which is a party to the New York Convention; . . .
Section 3(2) is of crucial importance having regard to the arguments addressed to the House. It provides:
Any Convention award which would be enforceable under this Act shall be treated as binding for all purposes on the persons as between whom it was made, and may accordingly be relied on by any of those persons by way of defence, set off or otherwise in any [*593] legal proceedings in the United Kingdom; and any reference in this Act to enforcing a Convention award shall be construed as including references to relying on such an award.
Section 4 reproduces provisions of article IV of the Convention and obliges the party seeking to enforce a Convention award to produce the award and the arbitration agreement in proper authenticated form. Section 5, which gives effect to article V of the Convention, provides in subsection (1) that enforcement of a Convention award shall not be refused except in the cases mentioned in the section. Subsection (2) goes on to enumerate a number of matters which, if proved, would authorise a refusal to enforce the award. It provides so far as material:
Enforcement of a Convention award may be refused if the person against whom it is invoked proves. . . (e) that the composition of the arbitral authority or the arbitral procedure was not in accordance with the agreement of the parties or, failing such agreement, with the law of the country where the arbitration took place; or (f) that the award has not yet become binding on the parties, or has been set aside or suspended by a competent authority of the country in which, or under the law of which, it was made.
Finally, subsection (5) provides:
Where an application for the setting aside or suspension of a Convention award has been made to such a competent authority as is mentioned in subsection (2)(f) of this section, the court before which enforcement of the award is sought may, if it thinks fit, adjourn the proceedings and may, on the application of the party seeking to enforce the award, order the other party to give security.
In support of their arguments for and against the proposition which found favour with Hirst J. that the arbitrators award was made in London, both counsel have made reference, as an aid to construction of the Act of 1975, to the travaux préparatoires leading up to the Convention. In so far as it can properly be said that there is any ambiguity in the Act, this is, of course, perfectly permissible as indicating the difficulty with which the Convention, and thus the Act, was seeking to contend. Speaking for myself, however, I have not found this reference of any assistance. It is evident that in the negotiations leading to the Convention there emerged divergent views between the delegates about the appropriate criterion for determining to what awards the Convention should apply and that the school of thought which favoured the simple, if arbitrary, geographical test of where the award was made ultimately won the day, but subject to a compromise addition which included also awards not considered as domestic in the enforcing state. Save to the extent, however, that these discussions indicate a general realisation that the geographical test might produce anomalous results, the travaux do not really help. In particular, they go nowhere towards indicating what satisfies the geographical test and constitutes the making of an award. Nor, in my view, is there any real ambiguity in the word made which requires to be resolved by reference to such [*594] extraneous aids. Mr. Coleman relies heavily on the views expressed by Dr. F. A. Mann in April 1985 in the quarterly journal Arbitration International, vol. 1 (1985), p. 107 and by Steyn J. and Mr. Veeder Q.C. in the International Handbook on Commercial Arbitration, vol. 1, supplement 9 (1988). Both favour, in varying degrees, the conclusion that the award is made at the place which is the curial seat of the arbitration. This would make very good sense if the inquiry were as to the place at which, from the point of view of legal convenience and, almost certainly, of the parties intentions, the award ought to be deemed to be made. The difficulty that I feel, however, is that, in common with all three members of the Court of Appeal, I cannot see how this result can be achieved by any legitimate process of construction of the Act of 1975. An award, whilst it is no doubt the final culmination of a continuing process, is not in itself a continuing process. It is simply a written instrument and I can see no context for departing from what I apprehend to be the ordinary, common and natural construction of the word made. A document is made when and where it is perfected. An award is perfected when it is signed.
The alternative submission is that an award is made when the arbitrator becomes functus officio and it is urged in the instant case that Mr. MacCrindle did not become functus officio until the parties were invited by the clerk of his chambers in London to take up the award. Up to that point of time, it is submitted, the arbitrator could have altered or withdrawn his award. Authority is of little assistance, but in so far as it exists it seems to me to be against the respondents proposition. Brooke v. Mitchell (1840) 6 M. & W. 473, was a case in which, under a court order which provided for an arbitration, the award of the umpire was to be made and published, in writing, ready to be delivered to the parties. . . . The award was executed by the umpire in the presence of two witnesses to whom its contents were made known and was to be collected on the afternoon of the following day. One of the parties having died on the morning of that day, the question arose whether it had been made and published in his lifetime. It was held that it had, Parke B. remarking, at p. 476:
it is only necessary that the act should be complete, so far as the arbitrator is concerned; that he should have done some act whereby he becomes functus officio and has declared his final mind.
Alderson B. similarly observed, at p. 478: the award is made and published, when the arbitrator, by some act, has expressed his final determination on the matters referred to him. The judgments in this case, which in any event depended upon the award being published, certainly employed the term functus officio but they in no way help the respondent. Indeed they seem to me to point strongly to the conclusion contended for by the appellant that it is the signature of the award that makes it complete so far as the arbitrator is concerned: see the interlocutory observation of Parke B., at p. 475. I do not, for my part, consider that it can be seriously open to doubt that Mr. MacCrindle had declared his final mind when he signed the award in Paris. Whilst, therefore, I find it anomalous and regrettable that the fortuitous [*595] circumstance of signature in Paris should stamp what was clearly intended to be an award subject to all the procedural regulations of an English arbitration with the character of a Convention award, I find the conclusion that it did irresistiblea conclusion which underlines the wisdom of the advice in Redfern & Hunter, International Commercial Arbitration (1986), at p. 70 that it is certainly safer (if less convenient) for the arbitrators actually to meet at the place of arbitration for the purpose of checking, signing and dating their award.
In my judgment, therefore, the Court of Appeal were right to hold that the award was a Convention award. The critical question is what is the effect of that holding. Mr. Coleman submits that, contrary to the conclusion reached both by McCowan and Leggatt L.JJ. in the Court of Appeal, this is not fatal to him but that nevertheless the English court, as both the enforcing court and the court of the seat of the arbitration, remains entitled, as it certainly would if the award had been made here, to entertain proceedings to set it aside or suspend it. The argument may be summarised as follows. It is perfectly true that section 3(1) of the Act of 1975 provides that the Convention award shall be enforceable in England but it does so subject to the following provisions of this Act (i.e. subject to sections 4 and 5). Equally it is true that sections 3(2) provides that the Convention award shall be treated as binding for all purposes, that it may be relied on . . . in any legal proceedings and that any reference in the Act to enforcing the award is to be construed also as a reference to relying upon it. Thus, since any legal proceedings is as wide a term as can readily be imagined and includes as much proceedings for leave to appeal against an award or for remission as any other proceedings, the mere recital of the fact that the award is a Convention award and thus binding for all purposes prima facie provides a complete bar to any such proceedings being successfully pursued. It has, however, to be borne in mind that subsection (2) applies only to a Convention award which would be enforceable under this Act and that throws one back to subsection (1) where the enforceability is subject to sections 4 and 5; and section 5(2)(f) contains the important provision enabling the enforcing court to refuse enforcement/reliance if it is proved that the award . . . has been set aside or suspended by a competent court of the authority . . . under the law of which the award was madewhich can conveniently be referred to as the curial country and which is, of course, in the instant case, England, it being beyond dispute that English law is the law of arbitration.
Thus, the argument proceeds, the Act of 1975 clearly contemplates that a position may arise where that which is prima facie binding and unchallengeable before the enforcing court may yet be set aside or suspended by the curial court and whilst it does not expressly deal with the improbable position which may arise where the enforcing country and the curial country are the same, there is nothing in the Act which excludes the arbitral jurisdiction of the curial court in the case where it turns out to be also the court charged with enforcing/recognising the award. [*596]
To these arguments the appellant gives three answers which to some extent overlap. First it is argued that both the Convention and the Act create a dichotomy between the country of origin of the award or the curial country and the country of enforcement. As a matter of the construction of section 5(2)(f) the country . . . under the law of which [the award] was made is as much, by definition, a country other than the enforcing country as is the country in which [the award] was made. Secondly, simply as a matter of timing subsection (2)(f) cannot apply here because it applies only where the award has been set aside or suspended at the time when the enforcement or reliance of the award comes into question. If this has not occurred at that point in time, there is nothing to set against the binding effect of the award prescribed by subsection (2) of section 3. Thirdlyand this is to some extent another way of expressing the first pointsubsection (2)(f) of section 5 can apply by definition only if there is, in the curial country, a competent authority, that is to say, an authority competent to set the award aside or suspend it. But section 3(2) has already told us that the courts of the United Kingdom are not competent to do anything but enforce the award in any legal proceedings (except as provided in section 5).
As regards the first of these arguments, I entirely see the force of the contention that the Act is framed on the assumption that the enforcing country and the curial country will be different, but I cannot see why, as a pure matter of construction of the expression the country under the law of which [the award] was made this should necessarily exclude the United Kingdom because it also happens to be the enforcing country.
The other two arguments would, to my mind, be much more formidable and, indeed, might well be unanswerable if the section finished at subsection (2). But it does not. We have to take into account the provisions of subsection (5). Now it is perfectly true that, as the appellant submits, subsection (5) is not free-standing. It does not, of itself, provide a ground for refusing enforcement/reliance but is merely concerned with providing an ancillary power of adjournment on the enforcing court in aid of the ground of refusal contained in subsection (2)(f). Nevertheless it has an important bearing on the construction of that subsection because it shows that the words has been in that subsection cannot mean literally has been at the date when the enforcement/reliance first comes into question. If that were the meaning, subsection (5) could have no possible field of operation because no adjournment could serve any useful purpose in the case of an application which was merely pending. The whole purpose of that subsection is to provide a power of adjournment in the case of pending proceedings to cover the period between the making of the application and the final ascertainment of whether the event contemplated by subsection (2)(f) is or is not going to occur. Thus one starts from the position that where the curial court is seized of an application the enforcing court is invested with power to suspend the enforcement of the award pending the outcome of those proceedings. Moreover subsection (5), as it seems to me, disposes also of the question whether the curial court is a competent court. On the appellants argument no curial court in any Convention country other than the country of the [*597] award could be a competent court, except in the remotely possible case of a country which has become party to the Convention and had not fully implemented it in its domestic legislation, for in every such country the award, as a Convention award, would be absolutely binding under section 3(2) and thus incapable of being set aside or suspended. So once again subsection (5), on this construction, would have no practical field of operation except in the case of a pending application in a non-Convention country. But it is plain that the framers of the Convention and the legislature in enacting its terms contemplated in subsection (2)(f) proceedings in a country other than the country of the award and I decline to believe that this important provision for preserving the arbitral control of the curial country was inserted for the sole purpose of covering the remote possibility of an award made in a Convention country pursuant to an arbitration conducted under the law of a non-Convention country.
In the course of his judgment, ante, pp. 573G-574B, Lord Donaldson M.R. considered the question whether in fact the respondents application for leave to appeal could be said, properly speaking, to be an application to set aside or suspend the award. He observed that in the context of an international Convention and an Act giving effect to it, what matters is not the technical terminology used in a national court, but the nature of the relief for which application has been made and he pointed out that in the case of the applications for leave to appeal and for remission under section 22 the applications, if successful, could lead to the setting aside of the award and that in all three cases the making of the application produces a de facto suspension of a non-Convention award. I agree and do not think that there is anything in this point. It does not, however, provide a complete answer for there is a further difficulty in the way of the respondents argument. The only power conferred by subsection (5) is to adjourn the proceedings. That, it is argued, must mean the proceedings referred to in section 3(2) in which the award is to be treated as binding and which include proceedings to set aside or suspend the award. Where, as here, the only proceedings on foot are the pending proceedings for the review of the award, the adjournment of those proceedingsthat is to say, the very application which gives rise to the enforcing courts power of adjournmentwould be self defeating. Clearly what is intended by the subsection is an adjournment of the proceedings for the enforcement of the award and where there are no such proceedings on foot, the appellant asks forensically, what is there to adjourn?
Lord Donaldson M.R. after pointing out that the only difficulty lay in the fortuitous identity of the enforcing and curial court found the answer to this by applying a purposive construction to the Act and treating the court, as he expressed it, ante, p. 574E-F as two separate courts with the judges wearing two different hats . . .
Without necessarily engaging in what might be regarded as a schizophrenic exercise, it does seem to me that the same result can be achieved as a matter of construction of sections 5(2) and 5(5). Both the Convention and the Act clearly contemplate that the curial court is or may be invested with and capable of exercising a supervisory power [*598] whilst leaving to the enforcing court a discretionary power (a) to permit a pending supervisory process to continue and (b) to refuse enforcement of the award if it results in the award being suspended or set aside. Subject to Mr. Sumptions point that no court in a Convention country other than that in the award country can ever be a competent authority (which, for the reasons which I have endeavoured to explain, I cannot accept) the section presents no difficulty at all where the enforcing court and the curial court are in different countries. The only difficulty lies in the limited power conferred by section 5(5) where the same court is both the curial and the enforcing court and the only proceedings consist of the application to the curial court in which, necessarily, the award is being relied upon by the other party. The plain purpose of the subsection was to enable the application to the curial court to catch up with the enforcement of the award and that purpose is achieved where there are no proceedings for enforcement on foot, by the adjournment by the enforcing court of the consideration of the issue of the enforcement of or reliance on the award. Now it is true that this may be thought to give an extended meaning to the word proceedings by applying it to what is, in fact, merely an issue in proceedings, but it gives a sensible meaning to the subsection and a meaning which, as it seems to me, is supported by the Convention. As previously mentioned, subsection (5) gives effect to article VI and article VI refers to the authority before which the award is sought to be relied upon adjourning the decision on the enforcement of the award [emphasis added].
It is argued that to apply such a purposive construction would defeat the policy of the Convention and of the Act, which is to avoid the need for the enforcing court to do more than enforce or recognise the award by excluding the application of that courts own arbitral rules and procedure. Whilst clearly that is the case where the enforcing court is in a country different from that of the country of the seat of the arbitrationwhich would be the normal situation, since the likelihood would be that the country of the award and the country having jurisdiction over the conduct of the arbitration would be the sameI can see no clear policy reason for excluding altogether the arbitral jurisdiction of the seat of the arbitration in the improbable case of the award resulting from the arbitration being made elsewhere and thus falling to be enforced in the curial country. Clearly the framers of the Convention contemplated the case of the arbitration and the resulting award occurring in different countries, and intended in article VI to provide for the possibility of the continued supervision by the courts of the curial country. Whilst it is doubtful whether they contemplated the unusual case of the curial country and the enforcing country being the same, I can see no good reason why they should have desired or sought to exclude that countrys curial jurisdiction in a case where its continuance would otherwise have been appropriate. There is nothing in the Convention that compulsively leads to the conclusion that the enforcing countrys curial jurisdiction is to be ignored in all circumstances and indeed article I itself contemplates its implication in determining whether any given award is to be considered as a domestic or non-domestic. [*599]
In agreement with the Master of the Rolls, therefore, I would hold that the High Court remains capable of exercising its curial jurisdiction over the arbitration and of adjourning, if it thinks fit, any decision on the enforceability of the award until the pending proceedings for review have been determined. Accordingly I would dismiss the appeal on this ground.
In the circumstances I have not found it necessary to express any view on Mr. Colemans further submission that, in any event, an award in Paris was contrary to the arbitration agreement so that he was enabled to rely upon section 5(2)(e)a ground not argued in the Court of Appeal but raised, by leave, before this House. It has, equally, been unnecessary to hear argument on the question of estoppel which constituted the ground upon which the majority in the Court of Appeal upheld the decision of Hirst J.
Appeal dismissed with costs.