Another round in favour of sports arbitration: Court confirms boxing disciplinary appeal panel is an Arbitration

In Bruce Baker v The British Boxing Board of Control [2015] EWHC 2469 (Ch) (UKT_2015_08_36956091) the Chancery Division found the Boxing Board’s Appeal procedure was an arbitration for the purposes of the Arbitration Act and thus barred Mr Baker form bringing a claim to have the decision to suspend his license as a professional boxing promoter quashed.

Mr Baker had been subject to disciplinary proceedings by the Board following his staging various boxing events at York Hall, Bethnal Green. The Board determined that the promotions were not properly organised, lacked qualified officials and some of the boxers were not licensed or fit to box, and it charged Mr Baker with misconduct. Following disciplinary proceedings Mr Baker’s license was suspended. He then brought an appeal before the Appeal Stewards of the Board, a panel of independent lawyers of significant expertise.

In that appeal Mr Baker was represented by two counsel and solicitors and was able to cross examine witnesses and make submissions about, amongst other things, the compatibility of the Board’s Rules with European Competition law. However he ultimately lost his appeal and the decision to suspend his license was upheld.

Mr Baker then brought a claim in the Chancery Division challenging the lawfulness of the Appeal Stewards decision. The Board brought an application to strike out Mr Baker’s claim on grounds, amongst others, that he was debarred from bringing a claim in the High Court because the Appeal was an arbitration for the purposes of the Arbitration Act and there were thus only limited statutory routes for challenging it, none of which had been relied upon, and Mr Baker was now out of time to rely on the statutory routes anyway.

Master Matthews, hearing the application, had to determine the key question of whether the Board’s Appeal was an arbitration for the purposes of the Act. In doing so he applied the analysis set out by Cooke J. in the England & Wales Cricket Board v Kaneria [2013] EWHC 10474 (Comm) case, which had in turn considered factors set out by Thomas J. in Walkinshaw v Diniz [2000] 2 All ER (Comm) 237. The Master considered the 10 factors set out in those cases, all of which go to whether the procedures are agreed between the parties, provide for the final determination of their dispute and provide for a fair hearing in proceedings of a judicial nature. The Master remarked that whilst there was “an obvious danger of treating the dicta of an eminent judge and the words or eminent text-writers as if they expressed a statutory definition” which they clearly did not, they helped to “focus on the characteristics which go to make up the concept of arbitration” and were a “good place to start” (paragraph 42 of the judgment).

The Court proceeded to consider each of the 10 factors set out in Kaneria in connection with Board’s submissions on how its Appeal procedures complied with those characteristics – see paragraph 43 of the judgment for a full breakdown of each one – and concluded the Board’s Appeal procedures clearly satisfied all of those factors. The fact that Mr Baker had himself brought the appeal, and consented to the procedures, underlined the point. The Court determined that as the Appeal procedures constituted an arbitration under the Act so Mr Baker could not bring the claim and his claim was struck out.

Comment

The case, following on from Kaneria, is another instance of the Court being prepared to consider sports’ disciplinary procedures as constituting arbitrations for the purpose of the Act. Previously there was some debate on the subject, with some saying that they were only internal disciplinary procedures and the High Court still exercised a supervisory jurisdiction over them. But it is now clear, in English law at least, that to the extent such procedures have all the hallmarks of an arbitration the fact they are disciplinary does not prevent them from being arbitrations.

Baker comes shortly after another interesting decision involving boxing and arbitration. In Paul Smith & Jamie McDonnell v British Boxing Board of Control Ltd, Frank Warren & Dennis Hobson (QB, Liverpool DR, Mercantile Court 13 April 2015, unrep.) boxers tried to rely on s.24 of the Arbitration Act to remove the Board (by its Appeal Stewards) from arbitrating a dispute which involved a challenge to the Board’s own Regulations that the boxers claimed constituted a restraint of trade. Section 24(a) of the Arbitration Act allows the Court to remove an arbitrator where “circumstances exist that give rise to justifiable doubts as to his impartiality”. The argument was that the Board had an interest in its own Regulations not being invalid and could not therefore be impartial in a dispute that challenged those Regulations. The boxers’ challenge failed, for a number of reasons, not least that they had consented to the arbitral proceedings and failed to take steps, when invited to by the Board, to have the High Court determine the validity of the regulation they sought to challenge. HHJ Bird, sitting as a High Court judge remarked that the Appeal Stewards were “an experienced quasi-judicial body” and referred to the proceedings as an “arbitration”. It was an important feature of both Baker and Smith & McDonnell, as it was in the Kaneria case, that the Appeal Stewards were an impartial board of experienced lawyers independent from the Board.

As the author has pointed out in a previous article on the Kaneria case (http://sportslawbulletin.org/2013/05/13/cricket-disciplinary-appeal-is-an-arbitration/) there are a number of advantages to sports’ governing bodies in their procedures being arbitral. In addition to being able to sort out disputes within the sport in a timely manner and under its rules, as opposed to have the disputes determined in the courts, the Arbitration Act means that various orders can be sort from the court in support of the proceedings, such as witness and disclosure orders, and of course arbitral awards and costs can be enforced by the courts (it is worth noting that the costs incurred in both the Kaneria and Baker were substantial).

The English Cricket Board and the British Boxing Board of Control were both able to demonstrate their appeal procedures were Arbitration Act compliant because they had sophisticated and well drafted rules that allowed for fair hearings to take place before independent panels of experienced lawyers. Both governing bodies had been careful to instil a level of institutional independence between the arbitral body and the rest of the governing body –a feature specifically taken account by the court in the cases.

Not all sports governing bodies share such procedures. Some, like the FA’s disciplinary procedures, do not even seek to be arbitral. Even though there are probably more disputes determined by the FA’s various disciplinary bodies than any other, Regulation 1.1 of the General Provisions Relating to Inquiries, Commissions of Inquiry, Regulatory Commissions of The Association, Other Disciplinary Commissions, Appeal Boards and Safeguarding Review Panel Hearings expressly provides that: “It should be borne in mind that the bodies subject to these provisions are not courts of law and are disciplinary, rather than arbitral, bodies.”

Indeed it is unlikely the FA’s disciplinary procedures would pass the Kaneria test even if the FA wanted them to – one of the troublesome features of the those regulations is the panel of members from which the members of a Regulatory Commission are drawn is the same as the panel from which members of an Appeal Board are drawn; so although different members of the panel will sit on first instance and appeal cases, they shall and often do determine each others’ decisions. The FA does have a sophisticated and impartial Rule K arbitral procedure for non-disciplinary matters though, where the parties can themselves appoint the arbitrators who are not selected from a closed panel. But the fact that the FA’s disciplinary procedures are not arbitral means Rule K can (and has) been used to challenge the decision of an Appeal Board, following the exhaustion of a disciplinary process, where it is alleged the decision was unlawful or otherwise subject to Bradley type review. That opportunity would not exist if the FA’s own Appeal Board, for example, was properly independent from the Regulatory Commission and was an arbitral body.

In addition increasing concerns have been raised about sports having closed panels from which arbitrators are selected. These have been most sharply brought into focus by the decision of the decision of the German Federal Courts in the Pechstein case (Pressemitteilung Zivilsachen, Oberlandesgericht München, 15 January 2015) in which an award of the Court of Arbitration of Sport against the athlete was not enforced. The German court found, amongst other things, serious defects in the way in which arbitrators were appointed to the CAS, in particular because of the strong influence of sports governing bodies on the appointment of arbitrators, and the lack of transparency involved in the appointments. FIFPro, the international union of football players, has backed Ms Pechstein in her legal challenge and has called for a reform in the process of appointment of arbitrators to the CAS, so that the rights of athletes are given equal respect as the rights of the sports governing body.

This issue naturally has greater significance where disciplinary issues arise, because the parties are the sports’ governing body on the one hand and the participant on the other. Where arbitral bodies are either appointed by the sports’ governing body itself, or by a body in which governing bodies have particular weight and influence, and where a lack of transparency in appointments exist, there shall be concerns about whether such bodies are really impartial, and so also whether they comply with the Arbitration Act.

In the author’s view it is even more important, both for sports governing bodies and for participants, that care is taken to ensure appointments to arbitral bodies are not at the bequest of the governing bodies, are made transparently and are, as much as possible, made with the genuine consent of the parties to the arbitration. That would be the clearest way to ensure both fairness and confidence in the resolution of sports disciplinary disputes, and the best way for sports’ bodies to avoid challenges to their arbitral procedures.

Nick De Marco acted for the British Boxing Board of Control in Bruce Baker v The British Boxing Board of Control and in Paul Smith & Jamie McDonnell v British Boxing Board of Control Ltd, Frank Warren & Dennis Hobson and acted as junior counsel to the ECB in England & Wales Cricket Board v Kaneria.