UCHENA
JA:
This is an appeal against
the
whole
judgment of the High Court dismissing the appellants application for
the setting aside of an arbitral award in terms of Article 34 of the
First Schedule to the Arbitration Act [Chapter
7:15]
hereinafter referred to as the Act.
FACTUAL
BACKGROUND
The
detailed facts of the case can be summarised as follows;
The
two appellants and the first respondent are Zimbabwean companies
registered in terms of the law. The second respondent is an
Arbitrator who is presiding over a dispute between the appellants
and the first respondent.
RM
Enterprises (Private) Limited (the second appellant) is a wholly
owned subsidiary of Riozim Limited (the first appellant).
On
19 January 2010 the first appellant and Maranatha Ferrochrome
(Private) Limited (the first respondent) entered into a memorandum of
Shareholders Agreement. In terms of the agreement, the first
appellant was to ensure that 40 per cent of issued shares in the
second appellant would be transferred without cost to the first
respondent so that the shareholding between the parties in the second
appellant would be as follows; Riozim 60 per cent and Maranatha
Ferrochrome 40 per cent.
On
29
January
2017, the first respondent wrote to the first appellant informing it
of its breach of the terms of the shareholder agreement. It informed
the first appellant that it had breached clause 1.1 of the agreement
as it failed to transfer chrome claims as agreed between the parties.
The
first respondent gave the first appellant notice that it would, in
terms of clause 30 of the agreement refer the dispute to an
arbitrator if the first appellant failed to fulfil its obligations
within 30 days.
The
parties agreed to refer the dispute to arbitration before the second
respondent.
At
the commencement of arbitral proceedings the first appellant raised
preliminary points objecting to the second respondent's
jurisdiction, the validity of the agreement and that the first
respondent's claim had prescribed.
The
first appellant averred that there was no arbitration agreement
between the first appellant and the first respondent (the parties to
the agreement) and the second appellant who was the subject of the
agreement. The first appellant averred that clause 30 of the
agreement sued upon by the first respondent was between it and the
first appellant and did not extend to the second appellant.
The
first appellant argued that the second respondent had no jurisdiction
to preside over the dispute.
The
first appellant averred that by the joinder of the second appellant
to the dispute, the first respondent accepted that the dispute could
not be resolved through arbitration as the arbitrator could not
exercise jurisdiction over the second appellant.
The
last point raised by the first appellant was to the effect that the
first respondent's claim had prescribed as the cause on which the
first respondent sued had arisen in 2010 and as such 3 years had
lapsed.
The
first respondent opposed the preliminary points.
In
determining the preliminary points, the second respondent ruled that
he had jurisdiction to preside over the matter as there was a valid
shareholder's agreement which the first appellant accepted to be
valid. He further found that an interpretation of the shareholders
agreement proved that clause 27 was placed in the agreement so as to
bind the second appellant impliedly and expressly to the provisions
of the agreement. The second respondent also ruled that the second
appellant being a wholly owned subsidiary of the first appellant and
the subject of the agreement, was bound by the provisions of the
agreement.
For
these reasons the second respondent dismissed the preliminary
objections on jurisdiction and the validity of the shareholder's
agreement.
On
the issue of prescription, the second respondent held that the
dispute between the parties was on whether or not there were
stipulated time limits for performance in the shareholder's
agreement to indicate when the cause of action would arise and make
the debt due.
The
second respondent held that as the shareholder's agreement was
silent on the date of performance the appellants could not be in mora
until a reasonable time for performance had lapsed after the first
respondent had made demand for performance.
He
further found that demand for performance was made by the first
respondent on 30 January 2018 and as such the debt had not
prescribed.
In
the result, the second respondent made an order dismissing the points
in
limine
raised by the appellants in proceedings before him. He ruled that he
had jurisdiction to preside over the dispute between the parties and
held that the first respondent's cause of action had not
prescribed.
Aggrieved
by the second respondent's decisions, the appellants applied to the
High Court (the court a
quo)
in terms of Article 34(2)(b)(ii) of the Model Law for an order
setting aside the second respondent's interim award.
The
first respondent opposed the application and raised two preliminary
points to the effect that the appellants could not seek the setting
aside of an interim award after a period of 30 days.
It
was argued on its behalf that in terms of Article 16(3) of the Model
Law, a party requesting the High Court to determine a matter of
jurisdiction had 30 days within which to apply for a determination on
the Arbitrator's ruling.
It
was further submitted that in this case the appellants applied to the
court a
quo
out of time, as the interim award was granted on 10 June 2019.
Therefore the appellants had up to 23 July 2019 to approach the High
Court to determine the matter in terms of Article 16(3).
The
court a
quo
upheld
the preliminary points and dismissed the appellants application on
that basis.
It
held that Article 34 of the Model Law was a procedure for the setting
aside of a final award and not an interim award.
It
further held that the award made by the second respondent was an
interim award dismissing the first appellant's special pleas and
that such an award could not be set aside as it had not terminated
the arbitral proceedings.
It
reasoned that the appellants having failed to make their application
in terms of Article 16(3) of the Model Law realised that they were
out of time and sought to resurrect their right to approach the court
by relying on Article 34(3) of the Model Law.
The
court held that the appellants conduct was dishonest and an abuse of
court process as they sought to approach the court out of time under
the guise of a wrong procedure.
In
the result, the court a
quo
upheld the first respondent's preliminary points and dismissed the
appellant's application.
On
the issue of costs it ordered that the appellants (who were the
applicants in the court a
quo)
to jointly and severally, the one paying the other to be absolved,
pay the first respondent's costs of suit.
Aggrieved
by the decision of the court a
quo,
the appellants noted an appeal to this Court on the following
grounds:
“GROUNDS
OF APPEAL
1.
The learned Judge erred in law and fact in finding that the
Appellants application under case number HC8150/19 should have been
brought in accordance with the provisions of Article 16 to the First
Schedule to the Arbitration Act [Chapter
7:15].
2.
The learned Judge erred and misdirected himself in failing to find
that the objections by the Appellants before the Second Respondent
went beyond a preliminary enquiry into the arbitrator's
jurisdiction. Consequently the Appellant could approach the High
Court in terms of Article 34 to the Arbitration Act [Chapter
7:15].
3.
The learned Judge erred in law and fact in failing to find as he
should have, that an arbitration award once handed down, becomes
final on all issues canvased therein and consequently such issues are
rendered res
judicata
in future proceedings.
4.
The learned Judge consequently erred in law and fact in finding as he
did that he had no jurisdiction over the Appellant's application in
case number HC8150/19.
5.
As regards the Second Appellant, the learned Judge erred in failing
to find as he should have, that Second Appellant, as a third party
who was not privy to the arbitration agreement between First
Respondent and First Appellant, was improperly joined before the
Second Respondent.”
SUBMISSIONS
MADE BY THE PARTIES
In
urging the court to exercise its discretion in the appellant's
favour, Mr Mpofu
counsel for the appellants, submitted that the court a
quo
erred
in dismissing the appellant's application.
He
argued that the interim award made by the arbitrator could be
challenged on the basis of Article 34 of the Model Law as the award
was final on the determination of the preliminary points raised by
the appellants.
Counsel
for the appellants further argued that international case law cited
in the appellants heads of argument establishes that an interim award
can be challenged under Article 34 of the Model Law.
Counsel
also argued that the appellants could not challenge the interim award
in two applications, one under Article 16 on the point of
jurisdiction and another under Article 34 on the point of
prescription. He contended that the correct procedure was to bring
one application under Article 34 to challenge both points and
question whether or not the award was contrary to public policy.
Per
contra,
Mr Girach
counsel for the first respondent argued that the judgment of the
court a
quo
was correct.
He
argued that the international authorities cited by the appellants
cannot be applied to the present matter as the Arbitration Acts of
India and Indonesia provide a definition for an award to include
interim awards.
Counsel
for the first respondent also argued that the wording of Article 34
of the Zimbabwean Arbitration Act does not extend to interim awards.
Counsel
further argued that the appellant ought to have challenged the
preliminary points under the procedure provided for in Article 16(3)
within 30 days and that when the appellants failed to do so they
sought to have a second bite of the cherry by employing the wrong
procedure under Article 34 of the Act.
ISSUE
FOR DETERMINATION
The
only issue to be determined in this appeal is, whether or not the
court a
quo
erred in dismissing the appellants application to set aside an
arbitral award in terms of Article 34 of the Model Law of the First
Schedule of the Arbitration Act on the basis that the application had
not been properly placed before it.
THE
LAW
Section
2(3), SCHEDULE
(Section 2)
MODEL
LAW,
Articles 16, 31(7), 32(1), 33 and 34 of the Arbitration Act are
relevant to the determination of this appeal.
Section
2(3) of the Act provides for the interpretation of the Act as
follows:
“2
Interpretation
(3)
The material to which an arbitral tribunal or a court may refer in
interpreting this Act includes the documents relating to the Model
Law and originating from the United Nations Commission on
International Trade Law, or its working group for the preparation of
the Model Law, that is to say the travaux
preparatoires
to
the Model Law, and,
in interpreting the Model Law, regard shall be had to its
international origin and to the desirability of achieving
international uniformity in its interpretation and application.”
(emphasis added)
Courts
should therefore always be conscious of the need to achieve
international uniformity when interpreting provisions of the Model
Law. This means the Model Law's interpretation by other
jurisdictions should be taken into consideration subject to the
exclusion of irrelevant interpretation of modifications by those
jurisdictions.
It
must be stated that relevant interpretations of modifications by
other jurisdictions which bring out the correct interpretation of the
Model Law can be taken into consideration.
In
the case of Courtesy
Connection (Pvt) Ltd and Another v Mupamhadzi
2006
(1) ZLR 479 (H) at 483B-C MAKARAU J (as she then was) commenting on
the international pedigree of the Model Law said:
“I
am further persuaded to hold as I do by the fact that the Act is of
international pedigree and certainty and finality of legal
proceedings were paramount in its formulation. It would destroy both
features if courts of the different countries adopting the Model Law
were to be allowed to extend the period within which an award is to
be set aside. Section 2 of the Act specifically provides that in
interpreting the Model Law, regard shall be had to its international
origin and to the desirability of achieving international uniformity
in its interpretation and application.
On
the basis of the application of the above two principles, I would
hold that the
right to
have set aside an arbitral award under Article 34 is irrevocably lost
if it is not brought within 3 months of the date of receipt by the
party intending to have it set
aside.”
(emphasis added)
See
also Mtetwa
and Anor v Mupamhadzi
2007
(1) ZLR 253 (S).
SCHEDULE
(Section 2) of the
MODEL
LAW provides for the identification of modifications of the Model Law
by our Legislature. It provides as follows:
“SCHEDULE
(Section 2) MODEL LAW
[This
Schedule contains the United Nations Commission on International
Trade Law (UNCITRAL) Model Law with modifications. The
modifications appear in italics.]”(emphasis
added)
Modifications
to the Model Law by our Legislature are italicised. Their
interpretation is guided by local precedents as they are not
internationally applicable.
In
interpreting the Model Law courts should therefore bear in mind the
distinctition between provisions which are of international
application and local modifications which are only applicable within
our jurisdiction.
Article
16 which is not italicised except for the words “High Court” and
a Latin term, and is therefore internationally applicable provides as
follows:
“ARTICLE
16
Competence
of arbitral tribunal to rule on its jurisdiction
(1)
The arbitral tribunal may
rule on its own jurisdiction,
including
any objections with respect to the existence or validity of the
arbitration agreement. For
that purpose, an arbitration clause which forms part of a contract
shall be treated as an agreement independent of the other terms of
the contract. A decision by the arbitral tribunal that the contract
is null and void shall not entail ipso
jure
the
invalidity of the arbitration clause.
(2)
A plea that the arbitral tribunal does not have jurisdiction shall be
raised not later than the submission of the statement of defence. A
party is not precluded from raising such a plea by the fact that he
has appointed, or participated in the appointment of, an arbitrator.
A plea that the arbitral tribunal is exceeding the scope of its
authority shall be raised as soon as the matter alleged to be beyond
the scope of its authority is raised during the arbitral proceedings.
The arbitral tribunal may, in either case, admit a later plea if it
considers the delay justified.
(3)
The arbitral tribunal may
rule on a plea referred to in paragraph (2) of this article either as
a preliminary question or in an award on the merits. If
the arbitral tribunal rules on such a plea as a preliminary question,
any
party may request, within thirty days after having received notice of
that ruling, the High
Court
to
decide the matter, which decision shall be subject to no appeal;
while
such a request is pending, the arbitral tribunal may
continue
the arbitral proceedings and
make an award.”
(emphasis
added)
Article
16(1) provides that an arbitral tribunal may rule on its own
jurisdiction, including any objections with respect to the existence
or validity of the arbitration agreement.
A
ruling on jurisdiction can therefore include that of any objections
with respect to the existence or validity of the arbitration
agreement.
A
reading of Article 16(1), (2) and (3) establishes that issues of the
existence or validity of an arbitral agreement can be included in a
ruling on the Arbitrator's jurisdiction.
It
must be noted that Article 16(3) consistently refers to the
arbitrator's preliminary decision on jurisdiction as a ruling and
it at the end distinguishes it from a decision made at the
termination of the proceedings which it refers to as an award.
A
party aggrieved by the arbitral tribunal's ruling can within thirty
days ask the High Court to decide the matter if the arbitral tribunal
rules on such a plea as a preliminary question.
The
arbitral tribunal can opt to determine the issue of its jurisdiction
as a preliminary issue or when it gives its award on the merits.
The
Article does not provide for a request to be made to the High Court
to decide the matter if the ruling is made in the award on the
merits.
It
is apparent from the wording of Article 16(3) that what the High
Court can decide the matter on is whether or not the arbitral
tribunal has jurisdiction and the existence or validity of the
arbitral agreement.
The
Article does not authorise it to go beyond those issues.
The
decision of the High Court on the ruling is final as it cannot be
appealed against.
The
Article makes a distinction between a ruling and an award by pointing
out that the arbitral tribunal can make the ruling to the preliminary
question or make such a ruling in its award on the merits.
It
is therefore clear that the ruling is not an award as it can be made
in the award on the merits and that while the issue of the ruling is
pending in the High Court the Arbitrator can continue with the
proceedings and make an award.
A
ruling on jurisdiction is therefore distinct and different from an
award.
Article
31(7) provides for other types of awards as follows;
“(7)
Unless otherwise agreed by the parties, an arbitral tribunal shall
have the power to make an interim, interlocutory or partial award”.
Article
31(7) is by virtue of its being italicised a local modification.
It
is however law in Zimbabwe and has to be taken into consideration in
determining the dispute between the parties in this case.
In
terms of this Article an arbitrator has power to make an interim,
interlocutory or partial award. These are types of awards which must
be accorded their appropriate status. It must be noted that the
modification does not alter the distinction between rulings and
awards.
Article
32(1) provides that arbitral proceedings are terminated by a final
award. It reads as follows:
“(1)
The arbitral proceedings are
terminated by the final award or
by an order of the arbitral tribunal in accordance with paragraph (2)
of this article”. (emphasis added)
It
is clear from a reading of Article 32(1) that a final award
terminates arbitral proceedings.
This
means reference to an award in Article 34 is generic and does not
only refer to the setting aside of final awards. If the intention was
to exclude other types of awards the framers of the Model Law would
have used the words “final award” instead of “award”.
Article
33 provides for additional, corrected or interpreted awards. It reads
as follows:
“ARTICLE
33 Correction
and interpretation of award; additional award
(1)
Within thirty days of receipt of the award, unless another period of
time has been agreed upon by the parties -
(a)
a party, with notice to the other party, may request the arbitral
tribunal to correct in the award any errors in computation, any
clerical or typographical errors or any errors of similar nature;
(b)
if so agreed by the parties, a party, with notice to the other party,
may request the arbitral tribunal to give an interpretation of a
specific point or part of the award.
If
the arbitral tribunal considers the request to be justified, it shall
make the correction or give the interpretation within thirty days of
receipt of the request. The interpretation shall form part of the
award.
(2)
The arbitral tribunal may correct any error of the type referred to
in paragraph (1)(a)
of this article on its own initiative within thirty days of the date
of the award.
(3)
Unless otherwise agreed by the parties, a party, with notice to the
other party, may request, within thirty days of receipt of the award,
the arbitral tribunal to make an additional
award as
to claims presented in the arbitral proceedings but omitted from the
award. If the arbitral tribunal considers the request to be
justified, it shall make the additional award within sixty days.
(4)
The arbitral tribunal may extend, if necessary, the period of time
within which it shall make a correction, interpretation or an
additional award under paragraph (1) or (3) of this article”.
The
reference to corrected, interpreted and additional awards in this
Article introduces other types of awards provided for in the Model
Law. These awards should be accorded their appropriate status when
interpreting Article 34's reference to an award.
Article
34 provides as follows:
“ARTICLE
34 Application
for setting aside as exclusive recourse against arbitral award
(1)
Recourse
to a court against
an arbitral award may
be made only by an application for setting aside in accordance with
paragraphs (2) and (3) of this article.
(2)
An arbitral award
may be set aside by the High
Court
only
if -
(a)
the party making the application furnishes proof that -
(i)
a party to the arbitration agreement referred to in article 7 was
under some incapacity; or the said agreement is not valid under the
law to which the parties have subjected it or, failing any indication
on that question, under the law of Zimbabwe;
or
(ii)
the party making the application was not given proper notice of the
appointment of an arbitrator or of the arbitral proceedings or was
otherwise unable to present his case; or
(iii)
the
award
deals with a dispute not contemplated by or not falling within the
terms of the submission to arbitration, or contains decisions on
matters beyond the scope of the submission to arbitration, provided
that, if the decisions on matters submitted to arbitration can be
separated from those not so submitted, only
that part of the award
which contains decisions on matters not submitted to arbitration may
be set aside; or [Subparagraph amended by Act 14/2002]
(iv)
the composition of the arbitral tribunal or the arbitral procedure
was not in accordance with the agreement of the parties, unless such
agreement was in conflict with a provision of this Model Law from
which the parties cannot derogate, or, failing such agreement, was
not in accordance with this Model Law; or [Subparagraph amended by
Act 14/2002]
(b)
the High
Court finds,
that -
(i)
the subject-matter of the dispute is not capable of settlement by
arbitration under the law of Zimbabwe;
or
(ii)
the
award
is in conflict with the public policy of Zimbabwe.
(3)
An application for setting aside may not be made after three months
have elapsed from the date on which the party making that application
had received the
award or,
if a request had been made under article 33, from the date on which
that request had been disposed of by the arbitral tribunal.
(4)
The High
Court,
when asked to set aside an award,
may, where appropriate and so requested by a party, suspend the
setting aside proceedings for a period of time determined by it in
order to give the arbitral tribunal an opportunity to resume the
arbitral proceedings or to take such other action as in the arbitral
tribunal's opinion will eliminate the grounds for setting aside.(5)
For
the avoidance of doubt, and without limiting the generality of
paragraph (2)(b)(ii)
of
this article, it is declared that an
award is
in conflict with the public policy of Zimbabwe if -
(a)
the
making of the
award was
induced or effected by fraud or corruption; or
(b)
a
breach of the rules of natural justice occurred in connection with
the making of the
award.”
A
reading of Article 34 establishes that it provides for the setting
aside of awards. It does not provide for the setting aside of rulings
by arbitral tribunals.
It
therefore seems to me clear that a party who fails to request the
High Court to decide on a preliminary ruling on jurisdiction and the
existence and validity of the arbitral agreement, within thirty days
cannot thereafter seek to set aside the ruling in terms of Article
34.
It
also seems to me clear that the word “award” having been used in
its generic sense accommodates the setting aside of all awards
specified in the Act.
Article
34 provides for the setting aside of an award for specified reasons.
Its scope is clearly wider than that of Article 16(3).
The
word “award” is in this article used in its generic sense. The
Article does not use the words “final award” used in Article
32(1) which would have restricted it to terminated arbitral
proceedings.
A
reading of Articles 16(3), 31(7), 32(1), 33, and 34 establishes that
rulings on the arbitral tribunal's jurisdiction and the existence
and validity of arbitral agreements are not awards. This is because
several Articles refer to various types of awards but none of them
was used to describe what the Model Law calls a ruling in Article
16(3).
This
means a ruling falls in its own class for which a separate and
distinct procedure is provided for challenging it.
APPLICATION
OF THE LAW TO THE FACTS
It
is common cause that the appellants seek to challenge a ruling by the
arbitral tribunal on jurisdiction,
the existence and validity of an arbitral agreement
and its decision/award on prescription.
In
challenging a ruling, the aggrieved party is entitled to approach the
High Court in terms of Article 16(3) within a period of thirty (30)
days. Failure to do so within the stipulated period leaves the party
aggrieved by the ruling without any other recourse to the courts as
Article 34 does not provide for the setting aside of the arbitrator's
rulings on jurisdiction.
The
legislature in crafting the Model Law used the term “ruling”.
It
cannot be argued that it meant an award as it went further to specify
that such a ruling can even be made in an award on the merits.
A
statute should be interpreted in a manner which gives the whole
statute and every part, section or word in it a meaning.
The
word “ruling” was persistently used in contradistinction with the
word “äward” in circumstances where the framers of the Model Law
as demonstrated by Articles 31(7), 32(1) and 33, were aware of other
types of awards but chose to refer to it as a ruling and provided a
separate procedure for challenging it.
I
am aware that Counsel for both parties referred to it as an interim
award, but that does not change the correct identity given to it by
the framers of the Model Law.
The
function of the court is to interpret a statute according to the
words used by the legislature and to call and interpret a thing by
the name given to it by the legislature.
In
the case of Keyter
v Minister of Agriculture
1908 NLR 522 at p523 it was said:
“It
is the duty of the court to give effect to every word which is used
in a statute unless necessity or absolute intractability of the
language employed compels the Court to treat the words as not
written.”
In
interpreting statutes courts are bound to interpret and give effect
to what the legislature actually said.
In
the case of R
v Kirk 1914 CPD 564
at
page 567 Kotze
J
said:
“We
cannot import words into the section not to be found therein, so as
to arrive at what we think or assume is the intention of the Act. The
Court must interpret and give effect to what the legislature actually
said, and not what it may have intended to say but did not say.
We
cannot insert words not used by the legislature to
meet what we may conceive was its real intention”. (emphasis added)
In
The
Queen v Bishop of Oxford
4
QBD 261 it was held that a statute “should be so construed that, if
it can be prevented, no clause, sentence or word shall be
superfluous, void or insignificant.”
It
is therefore my view that the word “ruling” was intentionally
used to bring out the distinction between it and an award.
What
was issued by the Arbitrator in respect of his jurisdiction is not an
award and cannot be challenged in terms of Article 34. It should have
been challenged in terms of Article 16(3).
That
opportunity was irrevocably lost and cannot be substituted by a
challenge in terms of Article 34.
In
my view, the court a
quo
did not err in finding that there was no proper application before it
in respect of the second respondent's jurisdiction and the
existence and validity of the arbitral agreement, as the appellants
could not rely on Article 34 to set aside the interim ruling when the
legislature had in terms of Article 16(3) of the Model Law clearly
provided the procedure to be followed.
The
appellant's appeal against the court a
quo's
decision on this issue cannot succeed.
The
position is however different in respect of the issue of prescription
which is not provided for by Article 16.
The
appellant also challenged the court a
quo's
decision on the dismissal of its application challenging the
abitrator's finding that the 1st
respondent's claim had not prescribed.
Mr
Mpofu
for the appellant relying on several cases from international
jurisdictions such as India, Indonesia, United States of America and
Singapore submitted that an interim award can be set aside in terms
of Article 34.
I
agree.
On
the other hand Mr Girach
for the first respondent submitted that cases from Indonesia and
Indian referred to by Mr Mpofu
should
not be followed because the decisions are based on modified Model
Laws of those jurisdictions.
While
caution should be exercised in following decisions made on the basis
of modified Model Laws, a court should first consider the
modifications made by those jurisdictions.
In
this case Mr Girach's
concern is that these jurisdictions have added to their Model Laws a
definition of an award which includes interim awards.
That
in my view is not of critical importance.
The
real issue should be are the definitions contrary to the contextual
interpretation of the word “award” as it is used in Article 34 of
the Model Law.
I
have already found that the use of the word “award” in Article 34
is generic and accommodates all types of awards. The framers of the
Model Law could have used the words “final award” which they were
aware of as they used them in Article 32(1) of the Model Law. The
choice of the word “award” in Article 34 which is repeated in
various parts of the Article instead of the restrictive words “final
award” means the intention was to allow applications for the
setting aside of other types of awards in terms of Article 34.
The
court a
quo
therefore erred when it held that only final awards can be set aside
in terms of Article 34.
It
also erred when it dismissed the whole application for that reason as
the application for the setting aside of the arbitrator's award on
prescription was properly before it.
It
is clear that the arbitrator's decision/award on prescription could
not be challenged in terms of Article 16(3) which only applies to the
arbitrator's jurisdiction and the existence and validity of
arbitral agreements.
I
am satisfied that the finding of the arbitrator on prescription can
be classified as an interlocutory, interim or partial award as
provided by Article 31(7).
The
appellants reliance on Article 34(2)(b)(ii) of the Act in respect of
the second respondent's decision on prescription is in my view
permissible because Article 16(3) does not provide a procedure
applicable to an arbitrator's decision other than that on
jurisdiction and the existence and validity of an arbitral agreement.
I
am satisfied that the appellants are entitled to be heard in respect
of their application challenging the arbitral award on prescription.
DISPOSITION
In
view of the findings already made, I am of the view that the appeal
should partially succeed in respect of the issue of prescription and
be struck off the roll in respect of the issue of jurisdiction and
the existence and validity of the arbitral agreement.
As
both parties partially succeeded each party shall bear its own costs.
It
is therefore ordered as follows:
1.
The appeal partially succeeds in respect of the Arbitrator's
decision on prescription, but is struck off the roll in respect of
the Arbitrator's jurisdiction and the existence and validity of the
arbitral agreement, with each party bearing its own costs.
2.
The judgment of the court a
quo
is set aside and is substituted by the following:
“1.1
The application for the setting aside of the arbitrator's ruling on
jurisdiction and the existence and validity of the arbitral agreement
is a nullity and is struck off the roll.
1.2
The application for the setting aside of the arbitrator's
interlocutory award on prescription shall proceed to a hearing on the
merits.”
3.
The case is remitted to the court a
quo
for it to hear and determine the application for the setting aside of
the arbitrator's interlocutory award on prescription on the merits.
MAVANGIRA
JA: I AGREE
MATHONSI
JA: I AGREE
Coghlan,
Welsh & Guest,
appellants
legal practitioners
Kantor
& Immerman,
first
respondent's legal practitioners
