S.68 of the Arbitration Act 1996 provides that an award may be challenged on grounds of serious irregularity giving rise to substantial injustice. The grounds of serious irregularity are set out in s.68(2), and include:
- Failure by the tribunal to comply with s.33 (general duty of tribunal),
- Failure by the tribunal to deal with all the issues that were put to it.
The opportunity to reconsider whether “ignoring” evidence could amount to a serious irregularity arose in UMS Holding v Great Station Properties 
Generally, the courts have held that a failure to address or to take account of particular items of evidence in the reasons for the award will not amount to a serious irregularity: see, for example, Lesotho Highlands v Impregilo  (HL) where Lord Steyn said: “nowhere in section 68 is there any hint that a failure by the tribunal to arrive at the correct decision could afford a ground for challenge”; in World Trade v Czarnikow Sugar  Colman J said: “That the arbitrators failed to take into account evidence or a document said to be relevant to that issue is not properly to be regarded as a failure to deal with an issue. It is, in truth, a criticism which goes no further than asserting that the arbitrators made mistakes in their findings of primary fact or drew from the primary facts unsustainable inferences.” and in Sonotrach v Statoil  Flaux J said “ …section 68 is about whether there has been due process, not whether the tribunal “got it right””. He said that a complaint that the tribunal reached the wrong result is not a matter susceptible of challenge under section 68.
However, in two cases – Arduina v Celtic Resources Holdings plc  and Schwebel v Schwebel , Toulson J and Aikenhead J respectively opined (obiter) that, in principle, a failure to take account of evidence could exceptionally give rise to a s.68 challenge.
The opportunity to reconsider whether “ignoring” evidence could amount to a serious irregularity arose in UMS Holding v Great Station Properties . It concerned a dispute between the parties over a joint venture agreement and an option agreement. The claimants alleged that the respondents had diverted profits and opportunities away from the joint venture and, further, that they were entitled to exercise a put option relating to shares. They commenced arbitration proceedings and the tribunal awarded damages against the respondents.
The respondents challenged the award under s.68. The challenge comprised 16 alleged serious irregularities, said to fall within either the general duty of the tribunal or failing to deal with the issues put to it. The principal complaint was that there had been, it was said, a wholesale and exceptional failure by the tribunal to consider or address large chunks of crucial evidence on central points of the case.
Teare J first considered the question of whether s.68 permitted the court to intervene on grounds of a failure to address or take into account evidence. In his view, it did not, for four main reasons:
- The tribunal was not obliged to deal expressly in its reasons with every individual point, or to refer to all the relevant evidence.
- The assessment and evaluation of evidence was a matter exclusively for the tribunal.
- In order to determine why a tribunal had not referred to a particular piece of evidence in its reasons, the court would have to consider the entirety of the evidence before the tribunal, including the transcripts of factual and expert evidence. Such an inquiry would be impermissible.
- S.68 was concerned with due process, not with whether the tribunal has made the “right” findings of fact.
Further, having considered the authorities, he considered that he was not constrained to adopt the obiter views of Toulson and Akenhead JJ to the effect that such a failure might exceptionally fall within section 68.
Teare J further noted that:
- The fact that the tribunal consisted of former judges and an eminent lawyer did not mean that the parties were “entitled” to a higher standard of award. The court would always strive to uphold arbitration awards, whoever the arbitrators were.
- An allegation that the reasons were manifestly illogical or irrational did not of itself amount to a ground of challenge within s.68, because the mere fact that the tribunal had reached the wrong conclusion could not constitute a serious irregularity. However, illogicality or irrationality might amount to evidence that the tribunal had failed to deal with an issue.
Applying these principles to the facts, Teare J found that no serious irregularity was established. His reasons included:
- The respondents relied on a paragraph of the award that appeared to conclude that the claimants were entitled to recover in unjust enrichment – a basis of claim that neither party had addressed. However, reading the award as a whole in a reasonable and commercial way, it appeared that this did not form the basis of the tribunal’s decision to award damages.
- The respondents argued that one of the tribunal’s conclusions was based on matters first raised in the claimant’s reply submissions, and that they had not been invited to comment on the new points. But Teare J held that they had had an opportunity to do so: had they wished to address the new points, they should have asked the tribunal for an opportunity to do so. The tribunal was not under a duty to ask whether they wished to say more.
- The various allegations that the tribunal had failed to take into account, or address, items of evidence could not in law amount to serious irregularities – even if the case could be characterised as “exceptional”. In any event, there was nothing about the quantity or quality of the evidence omitted from the reasons that could be described as “exceptional” and there was no basis for inferring from the reasons that the tribunal had overlooked substantial tranches of evidence.
- Furthermore, there was no basis for “aggregating” the matters relied on. It was true that where a number of irregularities within s.68 were established, it might be possible for them to be considered together when deciding whether substantial injustice was caused to the claimant. But the starting point must be that each individual ground must independently fall within s.68.
- Finally, the fact that the tribunal dealt with the evidence less fully than a High Court judge would have done was immaterial. Even assuming that s.33 imposed a duty to give reasons, so long as the tribunal has dealt with the issues and given “the reasons for the award” (as required by s.52(4)) that would be sufficient to discharge the duty. There is no scope for objecting to the quality or content of those reasons within s.68. A tribunal was entitled to deal concisely with issues and to refer only to key evidence: s.33 does not require the tribunal to refer to every piece of evidence. As reflected in s.52, the tribunal’s duty was limited to setting out “the reasons for the award”. The practice of judges and arbitrators in this respect differed.
Teare J’s judgment includes some important and helpful guidance on the proper scope and effect of s.68. The decision clarifies that a failure to take into account or to address individual pieces of evidence will not amount to a serious irregularity. The principal reason is it would involve the court in an extensive inquiry into the evidence before the tribunal, which would amount to trespassing onto areas within the tribunal’s exclusive remit.
The decision clarifies that a failure to take into account or to address individual pieces of evidence will not amount to a serious irregularity.
It will be of comfort to arbitrators that their awards will not be picked over by the Court to find inadequate citation of evidence on the record that might indicate that that evidence had not been properly considered. With that latitude comes responsibility: whilst the Court will strive to uphold awards, increased challenges that expose potentially inadequate reasoning does nothing to further the reputation of international arbitration. Tribunals must ensure that their awards are fully and properly reasoned and deal with the evidence and submissions of the parties.
Only where the tribunal admits a failure to take into account evidence might grounds to intervene arise under s.68(2)(i) (irregularity in the conduct of the proceedings, which is admitted by the tribunal).
The decision also confirms that matters that do not, individually, constitute serious irregularities cannot be aggregated to make up a composite serious irregularity. Furthermore, the fact that the tribunal consists of former judges does not mean that the courts will expect the award to be written or reasoned in the same manner as a judgment, nor that a “higher” standard is expected. The policy of upholding awards will be applied whatever the composition of the tribunal.
 One study of s.68 challenges found that in 2012, there was a total of 7 challenges all of which were rejected; in 2013, there was (again) a total of 7 challenges of which only 1 was allowed and the remaining 6 were rejected; in 2014, there was a total of 8 challenges of which 2 were allowed and the remaining 6 were rejected.