English Court Dismisses Section 68 Challenge for Failure to Exhaust Section 57 Recourse

In <span class="news-text_italic-underline">MHA Advisory Ltd v Wynter [2025] EWHC 2497 (Comm)</span>, the Commercial Court of England and Wales dismissed an application to set aside an arbitral award on the basis of alleged serious irregularity under section 68 of the Arbitration Act 1996 (“<span class="news-text_medium">AA 1996</span>”). The Court ruled that the Applicant failed to exhaust its right to seek clarification or correction under section 57 AA 1996 before pursuing its challenge and that the complaint was misconceived and “abusive.”

The underlying dispute concerned the enforceability of restrictive covenants preventing the Respondent from engaging in certain business activities for two years after ceasing to be a member of the Limited Liability Partnership (“<span class="news-text_medium">LLP</span>”). The matter was referred to arbitration, where the sole arbitrator determined that the two-year restriction was unreasonable and therefore unenforceable.

The LLP subsequently applied to the Commercial Court under section 68, alleging that the arbitrator had failed to resolve a central evidentiary conflict, thereby breaching his general duty under section 33 of the AA 1996 to act fairly and deal with all issues put before him. The LLP argued that this amounted to a serious irregularity within the meaning of section 68(2)(a), or alternatively, the arbitrator had failed to address all issues in breach of section 68(2)(d).

Paul Mitchell KC, sitting as a Deputy High Court Judge, dismissed the application, describing it as “abusive” of the “protection of last resort” provided by section 68. The Court held:

• The challenge was barred by section 70(2)(b), as the LLP had not exhausted its remedies under section 57. The LLP had asserted that the alleged irregularities were “fundamental” and incapable of remedy through a section 57 application. The judge found this argument to be based on a misreading of the award, noting that the LLP could and should have requested the arbitrator to clarify or elaborate on his reasoning.
• Even if section 70(2)(b) did not bar the challenge, the section 68 application would have failed on its merits. The arbitrator had not refused to determine any issue. Rather, the arbitrator had briefly but clearly concluded that the LLP failed to prove the reasonableness of the two-year period and therefore did not discharge its burden of proof.
• The Court further observed that, even if the arbitrator’s reasoning were limited to a finding that the LLP had failed to establish its case, the appropriate route for challenge would have been an appeal on a point of law under section 69, not a serious irregularity challenge under section 68.

The judgment underscores that parties seeking to challenge arbitral awards must first consider their recourse under section 57 AA 1996 and fully exhaust that right before turning to the courts under section 68. The decision reaffirms the narrow and exceptional scope of serious irregularity challenges in English arbitration law.

<span class="news-text_medium">Case Reference:</span> <span class="news-text_italic-underline">MHA Advisory Ltd v Wynter [2025] EWHC 2497 (Comm) (2 October 2025)</span>, Paul Mitchell KC (sitting as a Deputy High Court Judge).