BUA INTERNATIONAL LIMITED v. SKETCHYZ CONSULTING LIMITED
(2019)LCN/12962(CA)
In The Court docket of Enchantment of Nigeria
On Friday, the 29th day of March, 2019
CA/L/1201/2017
RATIO
ARBITRATION: WHAT GOVERNS THE APPOINTMENT OF ARBITRATORS
The appointment of an Arbitrator just like the subjecting of events dispute to arbitration within the first place is ruled by the settlement of the events. The final guidelines of contract regulation subsequently applies to an arbitration settlement topic to the provisions of the Arbitration and Conciliation Act Cap 18 Legal guidelines of the Federation of Nigeria 2004. It’s settled past rivalry that events to an settlement are certain by the phrases therein and the Court docket ought to provide impact to the intention of the events thereto as deductible from the phrases therein set down.
See: JFS INVESTMENT LTD. V. BRAWAL LINE LTD.(2010) LPELR-1610(SC); OFORISHE v. NIGERIAN GAS CO. LTD (2017) LPELR-42766(SC); and UNION BANK v. INNOSON (NIG) LTD (2017) LPELR-42725(CA).PER JAMILU YAMMAMA TUKUR J.C.A.
ARBITRATION: PARTIES ARE BOUND TO FOLLOW THE RULES ON METHOD OF APPOINTMENT OF ARBITRATORS
The implication of the above is that the place events consistent with Part 7 of the Arbitration and Conciliation Act, have agreed on a sure mode of appointing an Arbitrator, then they’re certain to comply with that technique of appointment. The Act additionally gives the process to comply with the place the process for appointment is agreed upon by the events, however identical shouldn’t be adhered to, in Subsection (3) of the identical part and identical is herein reproduced thus:
(3) The place, beneath an appointment process agreed upon by the parties-
(a) a celebration fails to behave as required beneath the process; or
(b) the events or two arbitrators are unable to achieve settlement as required beneath the process; or
(c) third social gathering, together with an establishment, fails to carry out any responsibility imposed on it beneath the process, any social gathering could request the Court docket to take the required measure, except the appointment process agreed upon by the events gives different means for securing the appointment.PER JAMILU YAMMAMA TUKUR J.C.A.
ARBITRATION: POSITION AND DUTY OF ARBITRATORS
An Arbitrator or group of Arbitrators in an arbitration proceedings stand within the position of a personal Decide and as such, the regulation locations upon such an individual the responsibility to conduct the proceedings in a fashion that’s truthful, lawful and usually designed to resolve the dispute in a simply method.PER JAMILU YAMMAMA TUKUR J.C.A.
ARBITRATION: THE EFFECT OF AN ARBITRATOR FOLLOWING THE WRONG PROCEDURE
The place the Arbitrator conducts the proceedings in a fashion that’s considerably unsuitable in some respect of the regulation, which ends up in wrongful conclusion, then the award reached could also be put aside.
The above acknowledged precept of regulation finds statutory expression in Part 30(1) of the Arbitration and Conciliation Act, which states thus:
The place an arbitrator has misconducted himself, or the place the arbitral proceedings, or award, has been improperly procured, the Court docket could on software of a celebration put aside the award.
The Apex Court docket within the case of A. SAVOIA LTD v. SONUBI (2000) LPELR-7(SC), (Pp. 11-12, paras. G-F) per OGUNDARE, J.S.C., restated the rules of regulation close to the situations the place the conduct of an Arbitrator can be termed misconduct able to vitiating the award reached thus:
“What’s misconduct is, in fact, not outlined within the Regulation nor within the Act. However this Court docket has, in Taylor Woodrow (Nig.) Ltd. v. Suddentsche Etna-Werk GMBH (1993) Four NWLR 127, spelt out some conduct that may quantity to misconduct throughout the regulation. A few of these are: (1) the place the arbitrator fails to adjust to the phrases, categorical or implied, of the arbitration settlement; (2) the place, even when the arbitrator complies with the phrases of the arbitration settlement, the arbitration makes an award which on grounds of public coverage ought to not be enforced; (3) the place the arbitrator has been bribed or corrupted; (4) technical misconduct, comparable to the place the arbitrator makes a mistake as to the scope of the authority conferred by the settlement of reference. This, nonetheless, doesn’t imply that each irregularity of process quantities to misconduct; (5) the place the arbitrator or umpire fails to resolve all of the issues which have been referred to him; (6) the place the arbitrator or umpire has breached the principles of pure justice. (7) If the arbitrator or umpire has did not act pretty in direction of each events, as for instance:- (a) by listening to one social gathering however refusing to listen to the opposite; or (b) by deciding the case on a degree not put by the events.”PER JAMILU YAMMAMA TUKUR J.C.A.
JUSTICES
TOM SHAIBU YAKUBU Justice of The Court docket of Enchantment of Nigeria
ABIMBOLA OSARUGUE OBASEKI-ADEJUMO Justice of The Court docket of Enchantment of Nigeria
JAMILU YAMMAMA TUKUR Justice of The Court docket of Enchantment of Nigeria
Between
BUA INTERNATIONAL LTD Appellant(s)
AND
SKETCHYZ CONSULTING LTD Respondent(s)
JAMILU YAMMAMA TUKUR J.C.A. (Delivering the Main Judgment): That is an Enchantment in opposition to the choice of the Excessive Court docket of Lagos State in Swimsuit No. LD/ADR/605/2014 delivered on 19th January, 2017, by Honourable Justice J. Efukembi Oyefeso (Mrs) in favour of the Respondent.
The fabric information of the case culminating on this attraction are herein rendered thus:
The Respondent had instituted an motion within the decrease Court docket through a Writ of Summons dated 20th August, 2014, primarily looking for fee of the sum of N7,939,521.42 (Seven Million, 9 Hundred and Thirty 9 Thousand, 5 Hundred and Twenty One Naira, Forty Two Kobo) representing the stability of contract sums, flowing from agreements contained in two separate contracts. In response, the Appellant filed an software looking for keep of proceedings so that the matter could also be referred to arbitration as agreed by the events. Sequel to the foregoing, an Arbitrator was appointed and he subsequently made an award dated 4th January, 2016, in favour of the Respondent. The Respondent by a Movement on Discover dated 11th February, 2016, sought an order of the decrease Court docket, recognizing and
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imposing the arbitral award, whereas the Appellant opposed vide a Counter Affidavit dated 26th April, 2016. The Appellant additionally filed a Movement on Discover dated third February, 2016, looking for the setting apart of the award. The Respondent opposed this through a Counter Affidavit dated 18th February, 2016.
The Court docket heard the 2 purposes collectively and in a ruling dated 19th January, 2017, held close to Appellants software, that events confirmed acceptance of the Arbitrator and the Arbitrator didn’t misconduct itself. He held close to the Respondent?s software that the award met with the necessities of the regulation, therefore he consequently gave an order recognizing and imposing identical.
Dissatisfied with the above, the Appellant appealed to this Court docket vide a Discover of Enchantment dated 24th January, 2017 and filed on 25-1-2017 with 5 grounds of attraction. (pages 599 – 604 of the Report)
The Appellants Temporary of Argument is dated and filed on 18th Could, 2018, however deemed correctly filed on 13th February, 2019.
Appellants counsel formulated two points for willpower to wit:
1. Whether or not the Appellant validly
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challenged the Arbitrators appointment, competence or jurisdiction. (Floor 1)
2. Whether or not from the information of this case, the Arbitrator was neutral, truthful and didn’t misconduct himself within the Arbitral Continuing? (Grounds 2 and three)
Alternatively, the Respondents Temporary settled by J.W. Dong Esq., is dated and filed on 4th February, 2019, however deemed as correctly filed on 13th February, 2019.
Respondents counsel additionally formulated two points for willpower to wit:
1. Whether or not the discovered trial Decide rightly arrived on the conclusion that the Appellant having confirmed the appointment of the Arbitrator is certain by the Arbitral Award.
2. Whether or not the discovered trial decide rightly held that the Arbitrator didn’t misconduct himself.
The problems raised by counsel on either side are considerably the identical, and I subsequently proceed to find out the attraction on the problems raised by the Appellant, for the aim of comfort.
?ISSUE ONE:
WHETHER THE APPELLANT VALIDLY CHALLENGED THE ARBITRATOR?S APPOINTMENT, COMPETENCE OR JURISDICTION. (GROUND 1)
Discovered senior counsel for the Appellant argued that the
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Arbitrator, who made the award which the Respondent sought to implement on the decrease Court docket, was not validly appointed as a result of his appointment was not in consonance with the settlement of the events. Counsel sought to ascertain the foregoing by arguing that the declare of the Respondent on the trial Court docket, which led to the arbitration that culminated within the award and software for enforcement, arose out of two separate agreements: an settlement for venture 1 evidenced in Exhibit 1 and one other settlement for Undertaking 2, evidenced in Exhibit 3; and that whereas clause 35.1 of Undertaking 1 gives for appointment of Arbitrator through the events settlement failing which resort is available to the provisions of the Arbitration and Conciliation Act, clause 18 of Undertaking 2, gives for appointment of an Arbitrator via the President of the Institute of Development Business Arbitrators. Thus the Respondent?s letter dated 11th Could, 2015, which requested the President of the Nationwide Institute of Architects to make the appointment, renders the appointment so made invalid.
?Discovered counsel additionally argued that opposite to the holding of the trial Court docket, the purported
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consent of the Appellant to the Arbitrator?s appointment is simply materials to the arbitration close to Undertaking 1; and that this difficulty was raised in paragraphs 6,7,eight of the Appellant?s Counter Affidavit dated 26th April, 2016, which the Respondent didn’t deny.
He submitted that the consequence of the invalid appointment is that the proceedings was a nullity and the award must be put aside. He additionally submitted that the mere proven fact that the Appellant participated within the continuing won’t preclude it from exercising its proper to have the award put aside.
He relied on the next:
Sections 2, 12(3)(a). and 48(a) of the Arbitration and Conciliation Act; Inakoju v. Adeleke (2007) Four NWLR (Pt.1025) 423; and Kano State City Growth Board v. Fanz Development Co. Ltd (1990) Four NWLR (Pt.142) @ 33 paras D-E.
Alternatively, discovered counsel for the Respondent argued that events are certain by the choice of an Arbitrator chosen by them and because it was the Appellant who requested arbitration, which led to the order of the decrease Court docket on 14th April, 2015, that the matter be referred to arbitration in accord with
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events settlement, and the Appellant confirmed the Arbitrators appointment through letter dated 2nd November, 2015.
He cited the instances of Taylor Woodrow Nig. Ltd v. Suddeutsche Etna-werk (1993) LPELR 3139 SC; and Nwabude & Anor v. Ugodu & Ors (2011) LPELR 9173 (CA).
Discovered counsel additionally argued that opposite to the Appellant?s rivalry, the Appellant was served with the Respondents processes, absolutely participated within the proceedings, and even requested for an extension of time to serve its processes from the Arbitrator, which was granted, thus can’t be heard objecting to the arbitration, which might quantity to permitting it approbate and reprobate.
He relied on the case of Abeke v. Odunsi & Anor (2013) LPELR-20640(SC).
RESOLUTION
The appointment of an Arbitrator just like the subjecting of events dispute to arbitration within the first place is ruled by the settlement of the events. The final guidelines of contract regulation subsequently applies to an arbitration settlement topic to the provisions of the Arbitration and Conciliation Act Cap 18 Legal guidelines of the Federation of Nigeria 2004. It’s settled past rivalry that
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events to an settlement are certain by the phrases therein and the Court docket ought to provide impact to the intention of the events thereto as deductible from the phrases therein set down.
See: JFS INVESTMENT LTD. V. BRAWAL LINE LTD.(2010) LPELR-1610(SC); OFORISHE v. NIGERIAN GAS CO. LTD (2017) LPELR-42766(SC); and UNION BANK v. INNOSON (NIG) LTD (2017) LPELR-42725(CA).
The implication of the above is that the place events consistent with Part 7 of the Arbitration and Conciliation Act, have agreed on a sure mode of appointing an Arbitrator, then they’re certain to comply with that technique of appointment. The Act additionally gives the process to comply with the place the process for appointment is agreed upon by the events, however identical shouldn’t be adhered to, in Subsection (3) of the identical part and identical is herein reproduced thus:
(3) The place, beneath an appointment process agreed upon
