Losing parties routinely instruct lawyers to challenge an award and are routinely disappointed, because the grounds are far narrower than the sense of injustice that motivates the instruction. Understanding what is actually reviewable saves substantial money spent on applications that were never going to succeed.
What is actually reviewable
| Ground | In practice |
|---|---|
| Misconduct of the arbitrator | Includes procedural misconduct, not only impropriety |
| Misconduct of the proceedings | Denial of a fair opportunity to be heard |
| Award improperly procured | Fraud, concealment, corruption |
| Error apparent on the face of the award | Narrow; must appear from the award itself |
| Award beyond the reference | The tribunal decided what it was not asked to |
| Invalid or non-existent agreement | Goes to jurisdiction |
Not reviewable: that the tribunal weighed the evidence wrongly, preferred the other side's witnesses, reached a decision you consider commercially unfair, or awarded less than you hoped. These are the complaints most losing parties actually have, and none of them is a ground.
What counts as misconduct
The term is broader than it sounds and does not require dishonesty. It extends to serious procedural failures, such as:
- Refusing to hear relevant evidence a party was entitled to present.
- Deciding on material a party never saw or had a chance to answer.
- Failing to give a party a proper opportunity to present its case.
- Undisclosed conflict or apparent bias.
- Ignoring the agreed procedure in a material respect.
- Failing to decide an issue that was referred.
The unifying theme is process, not outcome. A tribunal that heard both sides properly and reached a conclusion you dislike has not misconducted itself, however strongly you disagree with it.
The deadline decides most applications
- Note the date of the award and the date it was filed or notice given.
- Establish the applicable limitation period immediately - it is short.
- Take advice within days, not weeks.
- File within time even if the grounds need refining afterwards.
- Do not wait for settlement discussions to conclude.
- Keep evidence of when you received notice.
More good challenges fail on limitation than on the merits. The period runs from a defined event and is applied strictly - a party that spent six weeks negotiating before instructing lawyers frequently finds the question of merit never arises. Diarise the date the award arrives.
How a challenge proceeds
- Application to the competent court, within time.
- Grounds set out precisely, tied to the statutory basis rather than general dissatisfaction.
- The award and record produced.
- Notice to the other side, who will usually be seeking to make the award a rule of court.
- Hearing on the challenge.
- Outcome - the award is set aside, remitted, or upheld and made a rule of court.
Note the third outcome in the last row. Remission sends the matter back to the tribunal to reconsider specific points, rather than destroying the award - it is sometimes the realistic best case where the defect is confined.
Deciding whether to challenge
| Question | Why it matters |
|---|---|
| Is there a genuine statutory ground? | Dissatisfaction is not one |
| Is it within time? | Usually decisive |
| Is the defect on the record? | Errors must generally appear from the award |
| Was the point raised at the time? | Late objections carry little weight |
| What is the cost against the exposure? | Challenges are not cheap |
| Will it merely delay enforcement? | Courts recognise tactical challenges |
Be honest about the fourth row. If your procedural complaint was never raised before the tribunal at the time it arose, a court will reasonably ask why it surfaced only after you lost. Objections should be recorded contemporaneously, in writing, when they happen.
If you are defending an award
- Check the challenge is in time - the first thing to examine.
- Press for the grounds to be particularised, not asserted generally.
- Show the process was fair - directions, opportunities given, correspondence.
- Point to the absence of contemporaneous objection.
- Move to make the award a rule of court.
- Consider asking for security where the challenge appears tactical.
The tribunal's procedural record is your best evidence. Directions orders, correspondence and hearing records showing both sides were heard properly answer most misconduct allegations directly.
Making an award a rule of court
An award does not enforce itself. Under the 1940 Act the successful party generally applies to have the award made a rule of court, at which point it becomes a decree that can be executed.
- The award is filed in the competent court.
- Notice is given to the parties.
- Objections may be filed within the prescribed period - this is where a challenge surfaces.
- The court considers any objections on the statutory grounds.
- The award is made a rule of court if no sustainable objection is made.
- Execution follows as with any decree.
This is why the two sides of this article are really one process. The winning party's application and the losing party's challenge meet at the same stage, and the timetable that binds the challenger is set by the filing.
If you have won an award, move to file it promptly rather than waiting to see whether the other side pays. Filing starts the clock on objections, and a challenge that might have been made comfortably in a leisurely timetable often is not made at all once a deadline is actually running.
Reducing the risk during the arbitration
Much of a successful challenge is set up by things that happened during the reference. As a party:
- Raise procedural objections at the time, in writing.
- Ask for anything you need - documents, time, a hearing - on the record.
- Ensure every issue you want decided is properly pleaded and argued.
- Ask the tribunal to deal with an issue it appears to have overlooked, before the award is final.
- Check the award on receipt for issues left undecided or exceeded.
- Keep the full record - it serves you either way.
See how arbitration works under the 1940 Act and arbitration vs litigation.
Frequently asked questions
On what grounds can an arbitration award be set aside in Pakistan?
Broadly misconduct of the arbitrator or the proceedings, an award improperly procured, an error apparent on the face of the award, an award beyond the reference, or an invalid arbitration agreement.
Can I challenge an award because the tribunal got the facts wrong?
No. A court will not rehear the dispute. Disagreement with how evidence was weighed, which witnesses were preferred, or the commercial fairness of the outcome is not a ground.
What does misconduct mean?
It is broader than dishonesty and covers serious procedural failures - refusing to hear relevant evidence, deciding on material a party never saw, denying a proper opportunity to present a case, undisclosed conflict, or ignoring agreed procedure.
How long do I have to challenge?
The period is short and strictly applied, running from a defined event. More good challenges fail on limitation than on the merits, so take advice within days of the award rather than weeks.
What happens if my challenge succeeds?
The award may be set aside, or remitted to the tribunal to reconsider specific points. Remission is often the realistic best outcome where the defect is confined to particular issues.
Does it matter if I did not object at the time?
Considerably. A procedural complaint never raised before the tribunal when it arose invites the question why it surfaced only after you lost. Record objections contemporaneously and in writing.
I have won an award and it is being challenged. What should I do?
Check first whether the challenge is in time, press for the grounds to be particularised, produce the procedural record showing the process was fair, and move to make the award a rule of court.
How can I reduce the risk of a challenge?
Raise procedural objections in writing at the time, make requests on the record, ensure every issue is properly pleaded, ask the tribunal to address anything overlooked before the award is final, and check the award on receipt.
How does an award become enforceable?
The successful party generally applies to have it made a rule of court, at which point it becomes a decree that can be executed. Objections are filed at that stage, which is where a challenge surfaces.
I have won an award. Should I wait to see if they pay?
No - file it promptly. Filing starts the clock on objections, and a challenge that might have been made in a leisurely timetable often is not made at all once a deadline is running.
Sources & official references
- Arbitration Act 1940 - domestic arbitration in Pakistan
- Supreme Court of Pakistan - judgments and case information
- Lahore High Court - case status, cause lists and judgments