Court rejects bid to remove top QC from high-profile arbitration

Beloff: Leading sports arbitrator

Football club Newcastle United has failed in its bid to remove a top QC from being an arbitrator in a dispute it is having with the Premier League (PL).

His Honour Judge Pelling, sitting as a High Court judge, said there was “no real risk of bias” from the appointment of Michael Beloff QC, a renowned figure in the world of sports arbitration.

The current owners of Newcastle are seeking to sell their shares to a company ultimately owned by a Saudi Arabian sovereign wealth fund.

The PL contends that the company is controlled by the government of the Kingdom of Saudi Arabia, which would become a director of the club under section A of its rules. Newcastle disagrees with this interpretation.

The dispute is going to arbitration; Newcastle appointed former Supreme Court president Lord Neuberger as one arbitrator and the Premier League former Master of the Rolls Lord Dyson as another. The two judges then selected Mr Beloff as the tribunal chair, after neither party objected.

The PL’s solicitors, Bird & Bird, then disclosed that, in the last three years, it had been involved in 12 arbitral proceedings in which Mr Beloff had been an arbitrator. The firm appointed him in three of them, two of which were after he was appointed to the PL tribunal.

Further, Mr Beloff had advised the PL four times, including in March 2017 in relation to a potential amendment to section F of its rules.

Under section F, the league can disqualify individuals and entities from acting as a director of a club, and refuse to agree a change of control, in certain defined circumstances. The league has not made any decision to do so in the Newcastle case as yet.

The club said that, had it been informed of all this before Mr Beloff’s appointment, it would not have agreed to it. It is not suggested that Lord Neuberger or Lord Dyson knew any of this before Bird & Bird disclosed it.

Mr Beloff did not recuse himself, although he accepted that he ought to have disclosed the three appointments by Bird & Bird. He said section F was not relevant to the issue to be decided.

HHJ Pelling said Newcastle was wrong to focus on the 2017 advice about section F – the arbitration was concerned with “the logically prior and separate issue” of whether the Kingdom of Saudi Arabia satisfied the test for being a director under section A.

The court could not say whether Mr Beloff considered section A as part of his advice, because the PL “has asserted privilege as it is fully entitled to do”.

But both Mr Beloff and Bird & Bird said he did not and there was nothing to suggest they were lying about it.

“The professional repercussions for each of them lying about an issue such as this would be severe,” the judge noted.

“I conclude therefore that the fair-minded and informed observer, having considered the facts, and being neither unduly sensitive or suspicious nor complacent would accept this evidence and the assurances referred to above at face value.”

The “inadvertent” failure to disclose that Mr Beloff had previously advised the PL was also insufficient, HHJ Pelling continued.

He was not appointed to the tribunal by the PL, the section F advice had been given more than three years beforehand, and “most importantly” there was no continuing relationship between the two.

Further, none of the other arbitral appointments would “of themselves cause the fair-minded and informed observer” to see a real possibility of bias.

Taking a step back, HHJ Pelling concluded that “the weight of the whole does not exceed the sum of its parts”.

He said: “The fair-minded and informed observer, having considered the facts would have reached the conclusions I have summarised above and would have concluded that there was no real risk of bias from this conduct when viewed as a whole and assessed by reference to the evidence as is stood at the date of the hearing.”

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