Consequent upon a dispute between the Appellant and the Respondent, redress was sought at the Arbitral Tribunal. One of the terms of agreement was that Nigerian Law would govern the substantive contract. The said contract excluded the award of punitive damages. However, the tribunal awarded punitive damages. The issue that then arose was whether the Court of Appeal was right in affirming the decision of the Federal High Court setting aside the arbitral award made in favour of the appellant.
The Supreme Court affirmed the decision of the lower courts. Appeal dismissed with costs awarded to the Respondents because it lacked substance and merit. An error on the face of an award may justify its setting aside.
Parties were involved in a dispute relating to shipping transactions and subsequently submitted the dispute to Arbitration proceedings in England. The final award was made in favor of the appellant. By an exparte application, the appellant applied to the Queen’s Bench Division of the High Court of Justice, England for the award to be given the status of Judgment of the said court. The application was granted and the appellant subsequently applied to the Federal High Court to register and enforce the said judgment obtained from England.
The Arbitration and Conciliation Act provided a simpler and easier approach to the registration of foreign awards in Nigeria. Thus, subject to section 32 and 51 (2) of the said Act, an arbitral award obtained anywhere in the world can be registered and recognized by any court in Nigeria without recourse to a foreign court to first adopt same as its Judgment.
Plaintiff (Fanz) sued Defendant (KSUDB), in a Kano high court, claiming against it N6, 922,742.00 being damages for a breach of an agreement. Both parties agreed to take case to an arbitrator. Arbitrator made an award in favor of the plaintiff. Defendant made an application to set aside the award. Application rejected. Whether his decision was right or wrong is not for this court to adjudication upon since the high court is not a court of Appeal over arbitration proceedings. An award cannot set aside in an action commenced by a writ, a fortiori; it cannot be set aside on a counter claim. So the trial Judge took the Plaintiff’s application to enforce the arbitrator’s award. The defendant appealed. Appeal dismissed because no grounds of appeal in support of the appeal against the order refusing to set aside the award. The defendant has appealed to the Supreme Court against this judgment.
The proper thing counsel should have done was to have argued the appeal by reference to the issues identified and no longer by reference the grounds which are supposed to have been subsumed under one or other of the issues arising for determination. The decision of the Kano State high court staying proceedings pending the decision of the arbitration is valid rightly or wrongly. No protest of any kind as to the authority of the arbitrator to act in the matter submitted to him. So Defendant couldn’t challenge authority of the arbitrator to take the reference. The Court of Appeal was in error in holding that there were no grounds of appeal before it against the order of the trial court refusing to set aside the arbitrator’s award. An undue delay in bringing an application under section 12(2) of the law to set aside an award can never militate against the application; it was the Appellant’s ground which has been up hold.
In 1964 parties entered into an agreement of charter – party that was to require defendant to produce a cargo of groundnuts for shipment in a ship to be provided by the plaintiff. The substantive contract was to be regulated by Russian law and in the event of a dispute; such dispute would be referred to arbitration before a Moscow arbitral tribunal. The defendant defaulted and the matter was referred to a Moscow arbitral tribunal. The tribunal made an award in favor of the plaintiff. The plaintiff brought an action in the Kano State High Court for enforcement of the award. The trial court dismissed the plaintiff’s claim.
The Supreme Court in its Judgment stated that the action was not brought in accordance with section 13 of the Arbitration Law of the Northern States which requires for leave of court or judge to be obtained first in order to enforce an arbitration award in High Court. Furthermore, that the statutory period of limitation should run from the date of the date of the breach of the charter-party when the “cause of arbitration” occurred and not from the date the award was made. Except the charter-party agreement contained a Scott v Avery clause stating that arbitration shall be a condition precedent to the commencement of any action in law.
The Appellant supplied a total of 250 metric tons of cocoa beans to the 1st and 2nd respondent at an agreed fee. Rather than paying the outstanding balance they decided to procure four arbitration awards. The Appellant sought an order of court setting aside four International Arbitration Awards obtained in London on the 15th of June 2001 by the 2nd respondent. The trial Judge agreed with the appellant that the four awards were invalid as the tribunal lacked jurisdiction (due to the absence of an enforceable contract between parties). However, the Trial Judge struck out the appellant’s application.
The Court of Appeal agreed that there was no enforceable contract between parties. However disagreed with the trial Judge on his stance on the need for registration before recognition. Furthermore, an arbitral award becomes binding and recognized as soon as it is made (irrespective of the country in which the award was made). The Appeal was allowed.
The Respondents filed an application at the Lower Court, on the 27th of September, 2010, seeking the court to recognize and grant them leave to enforce in the same manner as Judgment of the Federal Court, the final arbitral award rendered in the United Kingdom in a dispute between Appellants and the Respondents.
In affirming the decision of the trial court stated that failure to attach an original copy of the Agreement does not render the application incompetent. The trial Court instead of striking out the application, exercised its discretion to enforce the award but subject to the production of an original copy of the Arbitration Agreement.
The respondent by an originating summons sought leave of the Federal High Court to recognize & enforce the Arbitral Award made in UK, of the sum of US$103,982.39 against the appellant. The latter filled a notice of preliminary objection. However the trial judge held that the action was not time barred & the sum was USD 18.671.84. Being dissatisfied with the said judgment, appellant filed an appeal. The respondent did not obtain leave of High Court of England to enforce the award. The absence of such renders the award fallen short of the standard of a judgment. The respondent suit is not statute barred. The limitation law is not restricted to actions commenced in Lagos High Court only. Plus the limitation period for an action to recognize & enforce a foreign arbitration award in Nigeria is six years not one year.
The learned trial Judge was only enforcing the award granted by the arbitration in England. Appellant should have pursued in England by way of an appeal against the arbitral award. The award is binding on the parties. Therefore appeal is devoid of merit, dismissed. The judgment of trial court is affirmed.
The Respondent and Appellant entered into a charter agreement dated 10th July 2009. The Appellant violated terms of the Agreement and the Appellant moved to settle the dispute via arbitration as stipulated in the Agreement. The matter was settled in favor of the Respondent. However, the Appellant who appeared to be dissatisfied with the decision of the trial Judge appealed to the Court of Appeal.
In the present case, the rule in audi alteram partem had not been breached by the Arbitrator and affirmed the judgment of the trial court registering the arbitral award.
Parties agreed to settle refer a dispute to arbitrator appointed by the President of the Law Society in the UK and this was done in accordance with the agreement both parties subscribed to. The arbitrator gave the award in favor of the Appellant. Neither of the Parties applied to the court in England to set aside the award.
Subsequently, the respondent filed an application at the High Court of Lagos to reverse the award by the arbitrator in the United Kingdom.
If unchallenged an arbitral award remains binding & enforceable on both parties. The lead Judgment of the judge was in favor of the Appellant. It was ordered that the ruling of the trial court be set aside and the application filed by the Defendant/Respondent be struck out.
Appellants and respondent had entered into an agreement for the supply of various forms of equipment to the Bonny Export Terminal. The total cost of the contract being the sum of US$7,778,875.00. The appellants refused to pay the respondent then the latter instituted an action at the High Court for the recovery of US$4,733,183.62 against appellants. Meanwhile appellants prayed the court that the matter be referred to arbitration. Respondent filed a motion seeking the court’s order for judgment against the appellant in the sum of US$837,725.00. The court granted appellant’s application & referred the matter to arbitration. Defendant appealed. The lower court lacks the jurisdiction of adjudicating on the sum by excluding it from arbitration. Where the appellants not only failed to object to the use by the court of the irregular procedure but participated in the proceedings in spite of the irregularity, they cannot now complain.
The appeal is meritorious & allowed. The decision of the lower court excepting the sum of 837,725 USD from the respondent’s claim referred to arbitration is hereby set aside. Instead the entire sum claimed by the respondent which remains in dispute is hereby referred to arbitration. Appellants are entitled to the cost of the appeal put as N50, 000.