ASM Shipping Ltd of India v. TTMI Ltd of England

ASM Shipping Ltd of India (plaintiff) (the owners) and TTMI Ltd of England (the charterers) (defendant) entered a charterer-party. The charterer-party contained an arbitration clause providing that each party would appoint an arbitrator, and those two arbitrators would appoint a third arbitrator to serve as an umpire. A dispute arose between the parties, and ASM and TTMI each appointed an arbitrator. Those arbitrators appointed “X” as a third arbitrator. At a preliminary hearing in the arbitration, a key witness for ASM recognized X. The witness stated that X had served as the general counsel for another charterer in a court case in the English courts. The witness alleged that, during the case, the party represented by X accused the witness of a deliberate failure to disclose material documents and fraudulently falsified other documents. The witness raised concerns about X’s ability to remain impartial but continued to testify after raising these concerns. At the conclusion of the witness’s testimony, X informed the parties of his involvement in prior proceedings adverse to the witness. ASM then objected to X remaining as a presiding arbitrator, arguing X lacked the impartiality required to fully consider the witness’s testimony. Although he acknowledged he had participated in the trial involving the witness, X denied any impropriety and refused to withdraw. ASM then filed a motion in the English courts asking the court to remove X as an arbitrator. ASM argued X should have recused himself because of his prior involvement in the case against the key witness for ASM’s case. X countered that he did not recall the allegations of fraud or misrepresentation against the key witness and that he did not believe he needed to recuse himself.