Authored By: Simran Pejatta
University of Warwick
1. Case Citation and Basic Information
Halliburton Company v Chubb Bermuda Insurance Ltd (formerly Ace Bermuda Insurance Ltd) [2020] UKSC 48
Court: Supreme Court of the United Kingdom
Judgment delivered: 27 November 2020
Bench: Lord Hodge, Lord Reed, Lady Black, Lord Lloyd-Jones, Lady Arden
On appeal from: Halliburton Company v Chubb Bermuda Insurance Ltd [2018] EWCA Civ 817
2. Introduction
Halliburton v Chubb [2020] UKSC 48 arose from a challenge to an arbitrator’s impartiality after Halliburton discovered that the tribunal chair had accepted further Deepwater Horizon-related appointments involving Chubb without telling the parties. Halliburton applied under section 24 of the Arbitration Act 1996, arguing that the lack of disclosure created apparent bias. The Supreme Court had to decide whether that omission met the statutory threshold and, in doing so, set out when arbitrators must disclose overlapping appointments. The case has become an important reference point for London-seated arbitrations, particularly in specialist areas where repeat appointments are common.
3. Facts of the Case
The dispute arose from the Deepwater Horizon incident in 2010, which generated extensive civil claims in the United States. Halliburton had provided cementing and well-monitoring services and later faced significant litigation. Although the US federal court attributed only 3% of the overall liability to Halliburton, Halliburton paid approximately US$1.1 billion to settle the claims brought against it.1 It then sought indemnification from its excess liability insurer, Chubb Bermuda Insurance Ltd, under a Bermuda Form policy. Chubb declined indemnity, arguing that the settlement was unreasonable and that it had acted properly in withholding consent.2
The Bermuda Form policy required disputes to be resolved by arbitration in London before a three-member tribunal. Each party appointed one arbitrator, and the two appointees were expected to agree on a chair; if they failed to agree, the High Court would appoint one. Halliburton appointed Professor William Park, while Chubb appointed John Cole. As the party-appointed arbitrators could not agree on a chair, the High Court appointed Mr Kenneth Rokison QC.3 Before accepting the role, Mr Rokison disclosed that he had previously acted in several arbitrations involving Chubb and remained appointed in two ongoing references connected to the insurer.4
After pleadings were exchanged, Mr Rokison accepted a further appointment in an arbitration brought by Transocean, another insured party whose claim also arose from the Deepwater Horizon incident. He disclosed this appointment to Transocean but not to Halliburton.5 He later accepted an additional appointment in a related matter involving a different insurer, again without informing Halliburton.6 One of these references involved a defence closely resembling Chubb’s position in Halliburton’s arbitration.7
Halliburton learned of the additional appointments in November 2016 and raised concerns. Mr Rokison explained that he had not appreciated a duty to disclose under the IBA Guidelines, acknowledged that disclosure would have been prudent, and indicated that he would resign if both parties agreed.8 Chubb opposed his resignation, prompting Halliburton to apply under section 24(1)(a) of the Arbitration Act 1996 for his removal.9
4. Issues on Impartiality and Disclosure
The Supreme Court had to determine whether the circumstances surrounding Mr Rokison QC’s conduct gave rise to justifiable doubts about his impartiality under section 24(1)(a) of the Arbitration Act 1996.10 The Court considered how the objective test for apparent bias applies where an arbitrator holds overlapping appointments that share only one common party.11 It also examined the scope of an arbitrator’s duty of disclosure, including whether English law required Mr Rokison to inform Halliburton of his later Transocean appointments and how that duty interacts with the confidentiality of separate proceedings.12 Finally, the Court had to decide whether the non-disclosure, viewed at the relevant time, could amount to a real possibility of bias warranting removal.13
5.1 Appellant’s Arguments (Halliburton)
Halliburton argued that Mr Rokison’s acceptance of appointments in the Transocean references created circumstances giving rise to justifiable doubts about his impartiality.14 It submitted that the three arbitrations arose from the same underlying incident and involved overlapping factual and legal issues, including insurers’ challenges to the reasonableness of settlements.15 Halliburton contended that Chubb’s repeated appointment of the same arbitrator, without disclosure, created an informational imbalance and a risk that Chubb could benefit from insights gained in the other references.16
Halliburton also argued that the failure to disclose the appointments breached the duty of disclosure recognised in international arbitration practice, including the IBA Guidelines.17 It maintained that disclosure was essential to preserving confidence in the fairness of the proceedings, particularly where the arbitrator served as chair.18 Halliburton relied on Mr Rokison’s offer to resign as evidence that he recognised the seriousness of the situation and the potential appearance of bias.19 It submitted that his continued participation undermined trust in the tribunal and justified removal under section 24(1)(a) of the Arbitration Act 1996.20
5.2 Respondent’s Arguments (Chubb)
Chubb argued that the statutory threshold for removal was not met and that Mr Rokison’s appointments in the Transocean references were consistent with established practice in London-seated arbitration.21 It submitted that arbitrators frequently sit in multiple references arising from the same incident, particularly in areas such as Bermuda Form liability insurance, and that English law requires arbitrators to decide each case solely on the material presented in that reference.22
6. The Court’s Reasoning and Analysis
The Supreme Court began by reaffirming that impartiality under the Arbitration Act 1996 encompasses both actual and apparent bias, and that apparent bias is assessed from the perspective of the fair-minded and informed observer.23 This observer is assumed to understand that repeat appointments are common in international arbitration and do not, without more, undermine impartiality.24 The Court therefore examined whether the circumstances surrounding Mr Rokison’s later appointments created a real possibility of bias when viewed objectively.25
The Court rejected the argument that overlapping appointments are inherently problematic. It emphasised that English law requires arbitrators to decide each reference solely on the evidence and submissions presented in that arbitration.26 The Transocean references involved preliminary issues of policy construction, whereas the Halliburton arbitration concerned the reasonableness of Halliburton’s settlement.27 The Court considered these issues to be legally and factually distinct. It also noted that the preliminary issues in the Transocean references were resolved before the evidential hearing in Halliburton’s arbitration, which reduced any risk that Mr Rokison might rely on information unavailable to Halliburton.28 The limited overlap meant that the fair-minded observer would not infer that the later appointments compromised his ability to act impartially.29
The more complicated aspect of the appeal concerned non-disclosure. The Court held that arbitrators in English-seated international arbitrations owe a legal duty to disclose circumstances that might reasonably give rise to doubts about impartiality.30 Disclosure is essential to maintaining transparency and confidence in the arbitral process.31 Applying that principle, the Court found that Mr Rokison ought to have disclosed his later appointments to Halliburton. The references arose from the same underlying disaster, involved a common party, and were accepted after he had been appointed as chair, a role that carries heightened expectations of neutrality.32
However, the Court drew a clear distinction between a breach of the duty of disclosure and the existence of apparent bias. Non-disclosure is relevant, but it is not determinative.33 The Court accepted Mr Rokison’s explanation that he did not believe disclosure was required under the IBA Guidelines and noted that his involvement in the Transocean references was limited to short hearings on discrete issues.34 The fair-minded observer, aware of these contextual factors, would not conclude that the non-disclosure created a real possibility of bias.35 His offer to resign was treated as evidence of prudence rather than partiality.36
Assessing the circumstances cumulatively, the Supreme Court concluded that although non-disclosure was a breach of duty, it did not meet the statutory threshold for removal.37
7. Judgment and Ratio Decidendi
The Supreme Court dismissed Halliburton’s appeal and declined to remove Mr Rokison from the arbitral tribunal.38 The Court held that the statutory threshold under section 24(1)(a) of the Arbitration Act 1996 was not met, as the circumstances did not establish a real possibility of bias at the relevant time.39 Although the Court accepted that Mr Rokison ought to have disclosed his subsequent appointments in the related Transocean references, it concluded that non-disclosure alone did not justify removal.40 The Court emphasised that the assessment of apparent bias is objective and must be made by reference to the fair-minded and informed observer, considering the facts known at the time.41 The appeal was therefore dismissed, and no further orders or directions were issued.42
Ratio decidendi
An arbitrator’s failure to disclose a potentially relevant appointment does not automatically give rise to apparent bias. Removal under section 24(1)(a) is justified only where the undisclosed circumstances, viewed objectively and at the correct temporal point, create a legally sufficient appearance of bias warranting judicial intervention.43
8. Critical Analysis
The Supreme Court’s treatment of the disclosure issue in Halliburton v Chubb feels more limited than the situation called for. The Court accepted that Mr Rokison should have informed Halliburton about his later appointments, but it downplayed the significance of the shared background and the involvement of the same insurer.44 Even if the legal questions differed, Halliburton had no way of knowing that its arbitrator was dealing with related matters for the opposing party. That absence of information affects how a party views the process and whether it can trust that the tribunal is approaching its case without prior impressions. By concentrating on the technical differences between the references, the judgment does not fully acknowledge this practical concern, and the threshold under section 24(1)(a) ends up offering limited protection when disclosure does not occur.
The Court’s position also differs from what many arbitration users expect. The IBA Guidelines treat undisclosed repeat appointments involving a common party as circumstances that may raise doubts about impartiality.45 The Court recognised the Guidelines but chose not to follow them. Writers such as Born argue that disclosure is central to maintaining confidence in arbitration, especially in fields where the same arbitrators appear frequently.46 Redfern and Hunter make a similar point: parties often have limited insight into an arbitrator’s wider caseload, and undisclosed connections can unsettle them even if nothing improper has occurred.47 Lew and Mistelis add that neutrality is not only about substance but also about how the process appears to the parties.48 The judgment does not fully engage with these concerns, and the result is a standard that feels more forgiving of non-disclosure than many parties would expect.
Mr Rokison’s offer to resign shows how difficult the situation was. The Court treated the offer as a cautious gesture, but the fact that he considered stepping down suggests he recognised the seriousness of the position.49 A more open approach would have acknowledged that undisclosed overlapping appointments, particularly by a tribunal chair, can influence how the process is understood by the parties. The decision clarifies the duty of disclosure but leaves uncertainty about how far English law is willing to go to protect the appearance of neutrality.
9. Conclusion
The outcome in Halliburton v Chubb makes it clear that arbitrators should tell the parties about other appointments that might matter, but the Court took a very limited view of when non-disclosure actually affects impartiality. Even though the chair should have disclosed the overlapping references, the Court did not think the situation reached the level of apparent bias. This leaves some uncertainty for future cases, especially in specialist areas where repeat appointments are normal. The decision will probably influence how arbitrators deal with disclosure going forward, but it also shows that English law is still cautious about stepping in unless the facts are very strong.
Footnote(S):
1 In re Oil Spill by the Oil Rig “Deepwater Horizon” in the Gulf of Mexico, on April 20, 2010 (MDL 2179) (ED La 2014) (liability findings attributing 3% fault to Halliburton).
2 Halliburton Company v Chubb Bermuda Insurance Ltd [2020] UKSC 48, [10].
3 ibid [11]–[12].
4 ibid [13].
5 ibid [15]–[16].
6 ibid [17].
7 ibid [22].
8 ibid [20]–[21].
9 ibid [22]–[23].
10 ibid [10].
11 ibid [25]–[26].
12 ibid [13].
13 ibid [15]–[16].
14 ibid [17].
15 ibid [20].
16 ibid [21]–[22].
17 ibid [78]–[80].
18 ibid [81]–[82].
19 ibid [22].
20 ibid [23].
21 ibid [26]–[27].
22 ibid [26]–[27].
23 ibid [31]–[32].
24 ibid [33].
25 ibid [34]–[35].
26 ibid [52].
27 ibid [53].
28 ibid [54].
29 ibid [55].
30 ibid [78].
31 ibid [79].
32 ibid [80]–[81].
33 ibid [62].
34 ibid [63].
35 ibid [64].
36 ibid [65].
37 ibid [66].
38 ibid [41]–[44].
39 ibid [62].
40 ibid [66].
41 ibid [31]–[32].
42 ibid [68].
43 ibid [62], [66], [78].
44 ibid [41]–[44].
45 IBA Guidelines on Conflicts of Interest in International Arbitration (International Bar Association 2014), General Standard 3.
46 Gary Born, International Commercial Arbitration (3rd edn, Kluwer Law International 2021) ch 12.
47 Nigel Blackaby and others, Redfern and Hunter on International Arbitration (6th edn, OUP 2015) 212–15.
48 Julian Lew, Loukas Mistelis and Stefan Kröll, Comparative International Commercial Arbitration (Kluwer Law International 2003) 280–85.
49 Halliburton Company v Chubb Bermuda Insurance Ltd [2020] UKSC 48, [47].
Bibliography
Cases
Halliburton Company v Chubb Bermuda Insurance Ltd [2020] UKSC 48
In re Oil Spill by the Oil Rig “Deepwater Horizon” in the Gulf of Mexico, on April 20, 2010 (MDL 2179) (ED La 2014)
Legislation
Arbitration Act 1996
Guidelines
IBA Guidelines on Conflicts of Interest in International Arbitration (International Bar Association 2014)
Books
Born G, International Commercial Arbitration (3rd edn, Kluwer Law International 2021)
Lew J, Mistelis L and Kröll S, Comparative International Commercial Arbitration (Kluwer Law International 2003)
Redfern A, Hunter M, Blackaby N and Partasides C, Redfern and Hunter on International Arbitration (6th edn, Oxford University Press 2015)
