Expert Determination: the Court of Appeal considers what constitutes a ‘manifest error’

As outlined in Geldards previous articles on the topic of Alternative Dispute Resolution (more commonly referred to as ADR), Alternative Dispute Resolution is the approach to resolving disputes without involving the Court. It still usually involves lawyers, but the parties will attempt to resolve the matters between themselves and reach a commercial outcome without the need for litigation.

One method of ADR is Expert Determination (ED), this is where the parties contractually agree to submit their dispute to an expert in the relevant field(s) and request that the expert reach a decision. The contractual agreement between the parties sets out the scope of the expert’s instructions and mandate, and it will also confirm if the decision is to be final and binding, which it usually is.

WH Holding v London Stadium

The recent case of WH Holding Ltd v London Stadium LLP [2026] focused on the calculation of a payment from one party to the other upon a share sale. There were several factors to be considered, including whether the two agreements between the parties were to be considered as one transaction, and the potential size of the payment was substantial.

The parties therefore agreed to submit the dispute to ED and agreed that the expert’s decision would be final and binding, subject to there being no manifest error. Manifest error is one of the more common conditions and exceptions parties will include in contractual agreements for ED.

The expert (who was a leading commercial King’s Counsel) found in the Defendant’s favour. This in turn led to the Claimant issuing proceedings challenging the determination on the basis of manifest error.

High Court

Before the High Court, the Judge found that the expert had indeed made a manifest error. Accordingly, the determination was set aside.

The Defendant appealed to the Court of Appeal.

The Court of Appeal

In February of this year, the Court of Appeal granted the Defendant’s appeal and, in doing so, reaffirmed the status quo in relation to expert determinations and manifest error. Namely, that such challenges are very difficult and the threshold for any successful challenge is very high.

What are the key takeaways from the Court of Appeal’s decision?

1.      Narrow Test

A manifest error is not merely an error, nor even an arguable error.

The initial test is two-pronged:

(a)   You need to determine whether there has been an error at all; and

(b)   You need to assess whether that error is ‘manifest’.

In relation to whether an error is ‘manifest’ or not:

(a)   It must be clear and obvious;

(b)   It must be identifiable after limited investigation; and

(c)    So plainly wrong that no reasonable person could disagree.

2.      Contractual Provisions – Not a Special Category

The WH Holding case related to the interpretation of contractual provisions.

When considering the arguments put before it, the Court of Appeal held that experts applying contractual formulas do not operate under a stricter error standard. Even when formulas or calculations are involved, the normal principles of contractual interpretation apply.

Where an expert is required to interpret contractual provisions as part of their determination, a mistaken interpretation will only amount to manifest error if it is obviously wrong. For example, if more than one reasonable interpretation is available, the expert’s choice between them cannot be seen as a manifest error and the determination will not be set aside.

3.      An arguable interpretation cannot be a manifest error

Here, the expert’s conclusion (namely, that the share sale and option agreement formed a single qualifying transaction) was, at the very least, arguable. On that basis alone, the conclusion could not be manifestly wrong. The Court of Appeal emphasised that it is not enough for a court to think another interpretation is preferable or that the expert may simply have been incorrect.

The Court of Appeal’s decision reinforces judicial reluctance to reopen expert determinations. It provides reassurance that, where ED is chosen as a method of ADR, disputes will generally be resolved quickly and conclusively without prolonged litigation.

What does this mean in practice?

Parties that decide to go through ED must expect the expert’s decision to be final and binding upon them, unless they can agree for that not to be the case in advance. However, such an agreement will not usually be easy to reach, as not having a final and binding opinion will likely result in the other party/parties not being willing to spend the time and money going through the ED process.

Parties must also be aware that even if they include the manifest error exception in their agreement, to be successful in such a challenge is very difficult and the threshold is very high. It is also possible to agree wider rights of challenge in the contractual agreement, but, again, this might not be easy to agree with the other side.

From a lawyer’s perspective, the case reiterates the importance of careful drafting in relation to the contractual agreement when submitting the dispute to ED, including the scope of any exceptions and rights to challenge.

If you are navigating a contractual dispute, particularly one that requires ADR or ED specifically, please do not hesitate to reach out to our specialist Commercial Dispute Resolution department, who will be happy to discuss your matter with you.