Arbitrators, football and AI

Posted on 05 February 2019

Arbitrators, football and AI

In July 2016, League One side Fleetwood Town signed the Northern Irish footballer Dion Charles. This led to an arbitration: his previous club, AFC Fylde of the National League, complained to the Football Association that Charles was still under contract to them and Fleetwood Town had procured a breach of that contract ("tapped him up"), and had also breached FIFA rules. The arbitrator dismissed the contract claim but ruled there had been a breach of the FIFA rules, meaning that Fleetwood Town had to pay compensation to AFC Fylde.

Fleetwood Town challenged the arbitrator's decision in the High Court. One of its challenges was based on some emails that the FA had passed to it. It turned out that, after the hearing but before issuing his award, the arbitrator had contacted an in-house lawyer at the FA to ask him about the application of the FIFA rules. The FA's lawyer sent the arbitrator some information; and he remarked that he would have to reconsider the case in light of this. The arbitrator issued his award three days later without telling the parties about his communications with the FA.

In a judgment handed down on 30 November 2018, the High Court concluded that, by failing to give the parties an opportunity to comment on the information from the FA, the arbitrator had breached his duty to the parties under section 33 of the Arbitration Act 1996 to give them a reasonable opportunity of setting out their cases. The High Court remitted the award back to the arbitrator so that he could take further submissions from the parties on his communications with the FA. Fleetwood Wanderers Limited (t/a Fleetwood Town Football Club) v AFC Fylde Limited [2018] EWHC 3318.

Why is this significant? It highlights an issue which lies at the heart of new drives for efficiency in arbitration. December 2018 saw the launch of the Prague Rules on the Efficient Conduct of Proceedings in International Arbitration. The idea behind these is that arbitrators should be more proactive. Rather than relying on materials submitted by the parties, the tribunal should be able to appoint its own expert, make its own document requests, and do its own research. However, as the Prague Rules recognise, the parties must still be given an opportunity to comment on anything the tribunal takes into account when drafting its award.

This is a constraint on any drive for efficiency. Take an extreme example, which remains in the realm of science fiction at present but is not inconceivable: an AI arbitrator that can digest the information relating to a dispute and produce an answer instantly. The parties will still want an opportunity to comment on anything the AI arbitrator takes into account. That makes an instant answer impossible: there would still need to be submissions from the parties. Parties also want to know how an arbitral tribunal has reached its decision, not simply to look for ways to challenge the award, but also to understand how the dispute has ended (to give them closure, as a psychologist might say). So that is another constraint: a tribunal needs to take time to properly explain its reasoning in its award.

The arbitrator in the Fleetwood Town case may have thought he was speeding things up but in some parts of arbitration there are simply no shortcuts.

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