ACTION NO. 440 OF 2000

ACTION NO. 67 OF 2001

ACTION NO. 68 OF 2001

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BEFORE the Honourable Abdulai Conteh, Chief Justice.

Mr. Dean Barrow S.C. with Ms. Lois Young Barrow S.C. for the Applicant.
Mrs. Roberta Magnus-Usher for the First Respondent.
Mr. Fred Lumor for the Second Respondent.

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JUDGMENT

The substantive application in this matter first came before this court on 3 November 2000. It was by way of an Originating Summons dated 5th October 2000 by which the Applicant, Cedric D. Flowers sought leave of the Court pursuant to section 13 of the Arbitration Act - Chapter 69 of the 1980 Revised Edition of the Laws of Belize, for an order to enforce an Arbitration Award made in an arbitration between him on the one hand, and the Respondents on the other hand, as a judgment or order of the Court.

On that date, the two Respondents by their attorneys represented to the Court that the Summons was only served on their clients on 24 October 2000 and would therefore request an adjournment.

When the application finally came on to be heard on 8th of February 2001, Mr. Fred Lumor the learned attorney for the Second Respondent and Mrs. Roberta Usher, the learned attorney for the First Respondent, respectively indicated that they had filed separate actions, viz Actions Nos. 67 and 68 of 2001 in which they were seeking certain declarations from the Court impugning the Award the Applicant is seeking leave to have enforced as a judgment of the Court.

After listening to the learned attorneys for both the Applicant and the two Respondents it was decided to hear the objections of the Respondents why leave should not be granted to the Applicant to enforce the Award. This judgment therefore addresses as well the several issues raised in Actions Nos. 67 and 68 by the Second and First Respondents respectively.

The initial Award in this matter was made by the Arbitrator on 30th April 2000 pursuant to a submission made in a written agreement between the Applicant and the Respondents dated 15 May 1997. However, by an order of this Court made on 6th July 2000, that award was remitted to the Arbitrator, following an application by the Applicant to have it set aside or remitted on grounds of errors on the face of the Award.

As a consequence of the order to remit, the Arbitrator eventually published a Final Award on the 1st September 2000.

It is this Award of 1st September 2000 that the Applicant is now seeking leave of this Court to have enforced as a judgment. Against this, the two Respondents have taken several objections.

These objections are more fully set out in the Respondents' Summonses in Actions Nos. 67 and 68 of 2001 and their Affidavits in support thereof. In these summonses they are described as Plaintiffs, but for the purposes of this application, we will call them 'Respondents'; and the First or Second Respondent respectively as the context requires.

What is plainly clear from the Affidavits of the Respondents in support of their Summonses is the fact that they both had notice of and were aware of the arbitration proceedings the Applicant had commenced that resulted in the initial Award. They chose then not to take part or contest those proceedings, including the appointment and or jurisdiction of the Arbitrator (See the Affidavit of Victor Espat dated 7th February 2001 particularly paragraphs 18 to 31 for the Second Respondent; and paragraphs 12 to 14 of the Affidavit of Tracy Taegar dated 7 February 2001 on behalf of the First Respondent).

This, of course, is their undoubted right. But not having utilised that right, they have now come to Court to impeach the Final Award on the several grounds stated in their summonses. This again, they are entitled to do as the law allows them to do so - Oil Producers Trading Co. Ltd. v Societe Anonym Societe de Gestion d'Enterprise Coloniales (1934) 150 LT 475.

I should also state that the Respondents had notice of and were aware of the application by the Applicant to the Court in Action No. 222 of 2000 wherein he sought to set aside or remit the initial Award (see paragraphs 32 and 33; and paragraphs 15 and 16 of the above-mentioned Affidavits for the Second and First Respondents respectively). They could have, if they chose, joined in this exercise. But they again decided not to do so.

In the light of all this, it is perhaps understandable for the Applicant to experience some feeling of exasperation by the objections taken by the Respondents to his application for leave to enforce the Final Award as a judgment of the Court.

Be that as it may, I must, perforce, examine these objections, and to these I now turn in order to determine the application for leave to enforce the Award.

The objections raised by the Respondents may be stated as follows, although some of them are overlapping and this much was conceded by their attorneys who in arguing before me combined some of them.

The First objection by the Respondents is that the Award is null and void because the agreement upon which it was founded was validly terminated.

Secondly, the Arbitrator had no jurisdiction to have embarked on the submission either because he failed to determine whether he had jurisdiction to proceed on the arbitration and that he was not appointed in accordance with section 6 of the Arbitration Act - Chapter 69.

Thirdly, the arbitrator misconducted himself and the proceedings by hearing on 16th August 2000 oral representations by the Applicant on the Final Award in the absence of the Respondents or their attorneys.

Fourthly, the Award is in any event futile and not binding on the Respondents since there was no dispute or difference arising under Clause 8 of the Agreement dated 15 May 1997 to ground the appointment of an Arbitrator.

I shall now examine the several objections put forward by the Respondents.

IS THE AWARD NULL AND VOID AND UNENFORCEABLE OR NOT BINDING ON THE RESPONDENTS?

In the main, the Respondents contend that the Award is a nullity and therefore unenforceable because the Agreement from which it flowed, that is, the Agreement dated 15 May 1997 between the parties, that is to say, Belize Tourist Board, the First Respondent herein, of the first part, the Registrar of Hotels, the Second Respondent herein, of the second part and Cedric D. Flowers, of the third part and the Applicant herein, is null and void as it is ultra vires, because the Hotels Act - Chapter 228 (as it then was) and its replacement, The Hotels and Tourist Accommodation Act - No. 12 of 1997 confers on the Registrar of Hotels, the Second Respondent, exclusively the assessment and collection of hotel taxes.

Moreover the argument runs, the Applicant's authorization under the Agreement was validly terminated by the Second Respondent, the Registrar, as he is legally entitled to do in virtue of section 3 of Act No. 12 of 1997. Consequently, the Respondents' contention continues, the revocation of the Applicant's authorization instantly put an end to the Agreement, and therefore the Arbitration clause in paragraph 8 thereof (the submission) instantly ceased to exist.

To argue otherwise, the Respondents submitted, would be to put a fetter on a statutory body by contract which would be impermissible in law.

Let me say straightway that having listened carefully to the arguments and submissions of the Respondents on this score, I am not persuaded to agree with them. I find it difficult to accede to the contention of the Respondents, especially the Second Respondent, the Registrar of Hotels, that the contract with the Applicant was ultra vires the Hotels and Tourist Accommodation Act - No. 12 of 1997.

An analysis of this Act shows that the Registrar, the Second Respondent, is invested with the power to carry out its provisions. Also, he may authorise either generally or specially any other person to discharge any power, duty or function under the Act or regulations made under it. He may also revoke or vary such authorization at any time - See section 3 of the Act.

It is, in my view, clear therefore that the Registrar together with the first Respondent, the Belize Tourist Board, were within the provisions of the Act to have entered into the Agreement of 15 May 1997 with the Applicant. In particular, for example, subsection (2) of section 3 of the Act provides:

"In the exercise, performance or discharge of the powers, duties or functions conferred, imposed upon or assigned to him by or under this Act, the Registrar shall be subject to the general direction of the Belize Tourism Board."

Surely therefore, the Agreement of 15 May 1997 and its several provisions cannot be ultra vires of either or both Respondents.

Indeed, the whole tenor and provisions of the Agreement were intended to ultilize the services of the Applicant to facilitate and enhance the tax assessment and collection regime under Part IV of the Act: see preambular paragraph (5) and the dispositive paragraph 1(1) of the Agreement.

I should also point out here, even if only in parenthesis, that within the purposes, purview and the administration of the Act, subsection (2) of section 3 supra in my view, establishes an organic relationship between the Respondents inter se, that cannot be overlooked or ignored in the context of their agreement with the Applicant.

Therefore, it is my view that if in the exercise of his powers to end the authorization of the Applicant, which was, in the context of the contract between the Applicant and the Respondents, its very substratum, the second Respondent chose to do so in clear breach of contractual provisions, there must be consequences. The Registrar, with respect, cannot and should not be allowed to seek refuge behind some statutory apron and put forth the defence that he had the power to end the Applicant's authorization at any time. This is a refuge that cannot and should not avail either or both Respondents.

Whether it was the original Agreement of 15 May 1997 or the Memorandum of Amendment to Agreement of 13 March 1998, (albeit the Second Respondent did not sign the latter), it is manifestly clear that the parties expressly provided for a period of the duration of their relationship and for a period of notice for its termination. In the case of the latter, six months was specified in both the Agreement of 1997 and the Memorandum of Amendment to Agreement of 1998.

It is therefore, in my opinion, unconscionable and untenable that in the context of the agreement between the parties, one side could unilaterally put an end to it without consequences and then pray in aid some supposedly self-absolving statute. Even an attorney advising one of the Respondents had cautioned and urged the need for a period of notice before terminating the agreement with the Applicant, albeit, acknowledging the statutory powers of revocation of the Second Respondent - see the letter of Youngs Law Firm of 29 April 1997, annexed to Victor Espat's Affidavit and referred to in paragraph 5 therein.

To put an end to the contract by the revocation of the Applicant's authorization at anytime, as indeed the Second Respondent is empowered to do by the Hotel and Tourist Accommodation Act, is not, in my opinion, a blanket warrant for the repudiation of a contract against its express provision or an immunization against consequences for the improper termination of contract. Indeed, in my opinion, this was not a case of the Registrar (the Second Respondent) contracting away his statutory powers under the Act, which could be said to amount to a fetter on those powers. The Registrar chose to exercise those powers within a contractual context. This should not therefore be allowed to render the contract a mere scrap of paper by the Registrar simply turning around and insisting that he could terminate it at anytime he chose, regardless of consequences.

Also, I do not think the provisions of the Hotel and Tourist Accommodation Act - No. 12 of 1997 are in any event repugnant to the provisions of the agreement between the parties, or vice versa. The agreement cannot be ultra vires the Act or the powers of the Registrar thereunder. The purpose of the ultra vires rule is, in brief, as I understand it, to make ineffectual actions, decisions or contracts that are outside the scope of the power, object clause or authorization of the person, authority or entity concerned. It cannot therefore seriously be contended that in the light of the provisions of the Act, the Registrar acted outside his power in engaging the Applicant by the agreement between the parties.

Yes, subsection (3) of section 3 of the Act in addition to empowering the Registrar to authorize either generally or specifically any fit and proper person to exercise, perform or discharge any power, duty or function conferred, imposed upon or assigned to the Registrar by the Act or regulations made thereunder, also enables the Registrar at any time to revoke or vary such authorization.

This certainly does not impose a duty on the Registrar to vary or revoke such authorization. Therefore if the Registrar enters into a contract by which he authorizes someone to discharge some of his functions under the Act, he cannot in my view, turn around and revoke the authorization in clear of breach of that contract.

The proviso to subsection (3) also does not, to my mind, avail. All this says I believe, is that such authorization does not divest the Registrar of his powers, duties and functions. He may himself, notwithstanding such authorization, if he thinks fit, perform or discharge those powers, duties and functions.

This does not make ultra vires any contract the Registrar might have entered into with another to perform or discharge those powers, functions or duties. Any limitations on the statutory powers of the Respondents, especially those of the Second, in the Agreement with the Applicant, if there are any, are limitations which are only sub modo, and do not, in my view, fetter the free exercise of those powers necessary for his operation under the provisions of the Hotel and Tourist Accommodation Act.

I do not therefore, with respect, think that the authorities relied upon by the Respondents on this score make any difference to my conclusions. In the Birkdale District Electric Supply Company v Southport Corporation (1926) A.C. 355, an authority the Respondents laid much store on, the House of Lords however held that an agreement by which the electricity company had covenanted not to charge higher prices for electricity than those in the borough of Southport was not ultra vires the statutory duties of the company to supply electricity. The company had begun to charge higher prices contending that the agreement was incompatible with its duties to supply electricity within a given area. But the House held that the company was bound by the agreement.

Commenting on this decision, the learned authors of Volume 1 Chitty on Contracts (Twenty-Seventh edition) at page 530 paragraph 10-027, state that it at least established that contractual stipulations, in order to be ousted as a fetter on statutory powers, must be clearly proved to be incompatible with the full observance of the terms and full attainment of the purposes for which those statutory powers have been granted. They concluded on this point by stating further that "if the incompetence of the public authority is only an incompetence sub modo, beyond which the powers necessary to its operation may be freely exercised, the contract will stand."

I therefore do not think that the Respondents in entering into the Agreement with the Applicant offended against the expressed statutory provisions contained in the Hotel and Tourist Accommodation Act.

Also, in the Maritime Electric Company Ltd. v General Dairies Ltd. (1937) A.C. 610, the issue was whether the negligence of the servants of public utility company which had resulted in customers paying far less for erroneous meter readings, estopped the company from recovering the balance, as it was under the New Brunswick Public Utility Act prohibited making from any greater or less charge for its services. The court held that the company could not be estopped because the statute imposed a duty on the Company not to charge more or less, so it was entitled to recover.

Here in this case, the Act, that is, The Hotel and Tourist Accommodation Act, does not impose a duty on the Registrar to hire or authorize anyone to help him perform his duties under the Act. A fortiori therefore, I do not think there is a duty imposed on him to vary or revoke such authorization. By entering into the contract with the Applicant the Registrar was not divesting himself of his functions, powers and duties. Indeed, he could himself if he so desires, perform those duties and functions. But this does not, I hold, absolve him from the obligations he had, consensually with his eyes open, entered into with the Applicant.

It would in my view, be equally be untenable if the Applicant were to seek to resile from his engagement with the Respondents contrary to the stipulations in their agreement. Reciprocity of obligation is the essence of a binding contract. In the context of this case one side cannot be bound by the agreement while the other can always say it is free by the provisions of some statute to terminate it any time. This cannot lie in the mouth of the Respondents, and the law should not allow this. Moreover, I believe it was the legitimate expectation of the parties, at least certainly, that of the Applicant, when the agreement between them was concluded, that subject to its express provisions in the event of its earlier termination, it would run its full course as they had agreed.

Therefore, the contention that the agreement was validly terminated flies in the face of express provisions, whether those contained in clause 6 of the agreement of 15 May 1997 or those in clause 4 of that of 13 March 1998.

It is therefore my view that the Final Award is not null and void and unenforceable, flowing as it is, from a submission expressly contained in an agreement between the parties and framed in such terms as is to be found in clause 8. I do not understand the Respondents to have contented, and I do not think they could so argue with any conviction, that the agreement itself was void ab initio or that it was never entered into at all. It is therefore implausible to argue that the Award is null and void and unenforceable simply because the Registrar could exercise his statutory power to revoke the authorization. To hold otherwise is to give sway to high-handedness in the face of express consensual stipulations between the parties to the contrary.

I would, if I may, in the context of clause 8 in the agreement between the parties, adopt the statement of Viscount Simon L.C. as read by Lord Macmillan in Heyman and Another v Darwins Ltd. (1942) A.C. 356 at page 366:

". . . it is of much practical importance that the law should be quite plain as to the scope of an arbitration clause in a contract where the clause is framed in wide general terms . . . I conceive . . . the correct view on the matter as follows. An arbitration clause is a written submission agreed to by the parties to the contract, and, like other written submissions to arbitration, must be construed according to its language and in the light of the circumstances in which it is made. If the dispute is whether the contract which contains the clause has ever been entered into at all, that issue cannot go to arbitration under the clause, for the party who denies that he has ever entered into the contract is thereby denying that he has ever joined in the submission. Similarly, if one party to the alleged contract is contending that it is void ab initio (because, for example, the making of such a contract is illegal), the arbitration clause cannot operate, for on this the clause itself is also void. But, in a situation where the parties are at one in asserting that they entered into a binding contract, but a difference has arisen between them whether there has been a breach by one side or the other, or whether circumstances have arisen which have discharged one or both parties from further performance, such differences should be regarded as differences which have arisen" in n respect of or 'with regard to' or 'under' the contract, and an arbitration clause which uses these, or similar, expression should be construed accordingly. By the law (of England) . . . such an arbitration clause would also confer authority to assess damages for breach, even though it does not confer on the arbitral body express power to do so" (emphasis added).

As I have mentioned, it is not the contention of the Respondents that the agreement qua agreement between the parties was void whether ab initio or at all, or illegal or that it was ever entered into; but rather that the Registrar validly terminated it as he is, they argue, entitled to do, and that this termination put end to the agreement and the arbitration clause it contained.

In any event, the agreement, I hold, cannot be void whether ab initio or all: From the provisions of the Act, particularly section 3 in Part ll, dealing with its administration, it is clear that the Respondents could lawfully enter into the agreement they did with the Applicant. Also, the fact that the Respondents purported to end the agreement by the letter dated 8 July 1998 from the Second Respondent did not and could not make the agreement void. All this did was purportedly to terminate unilaterally the agreement contrary to its express provisions. This, I hold, is the heart of the contention between the parties.

It is instructive, I believe, to set out here so far as is material the relevant provision relating to the submission in clause 8 of the Agreement between the parties. It provides:

"Any dispute or difference arising between the parties hereto during the course of this contract or at the termination hereof, as to the construction of this agreement or as to any matter or thing of whatever nature arising hereunder or in connection therewith, then such dispute or difference shall be and is hereby referred to the arbitration and final decision of a person to be agreed between the parties . . ."

I therefore hold that the Award is not null and void and unenforceable. I should add here that this finding by me disposes also of the fourth objection of the Respondents as I stated it above. That is to say, the Award is futile and not binding since there was no dispute or difference under clause 8 of the agreement between the parties. As Lord Porter stated in Heyman v Darwins Ltd. supra at p. 392:

". . . I think it is essential to remember that the question whether a given dispute comes within the provisions of an arbitration clause or not primarily depends on the terms of the clause itself. If two parties purport to enter into a contract and a dispute arises whether they have done so or not, or whether the alleged contract is binding on them, I see no reason why they should not submit that dispute to arbitration. Equally, I see no reason why, if at the time when they purport to make the contract they foresee the possibility of such a dispute arising, they should not provide in the contract itself for the submission to arbitration of a dispute whether the contract ever bound them or continues to do so."

I conclude therefore that the Award, absent any legal flaws by which it was arrived at by the arbitrator, is not null and void or unenforceable, and is in fact and in law binding on the Respondents. Moreover, by paragraph 8 of the First Schedule to the Arbitration Act - Chapter 69 of the Laws of Belize, it is an implied term of the submission contained in clause 8 of their Agreement that the Arbitrator's award shall be final and binding on the parties.

I now turn to THE APPOINTMENT AND JURISDICTION OF THE ARBITRATOR.

The Respondents have also sought to impugn the Award and object to the grant of leave to the Applicant to have it enforced as a judgment on the grounds that the Arbitrator had no jurisdiction to have embarked upon and proceeded with the submission and he failed to determine whether he had jurisdiction and that the Award is not binding on them as the Arbitrator was not appointed in accordance with section 6 of the Arbitration Act.

These grounds, in essence, seek to re-agitate issues that were expressly addressed and decided by the court in its judgment dated 6th July 2000 in Action No. 222 of 2000. In that action, the Applicant himself sought to impugn the Award of the arbitrator dated 30th April 2000 by requesting the Court to set it aside or remit it for errors on the face of the Award.

Although the Respondents were served with all the documents in that action and had notice of the proceedings, they chose not to take part. There is therefore much force to the submission of the learned attorney for the Applicant, Mr. Dean Barrow S.C., that the Respondents are estopped from impugning the Award on this score. For in its judgment in that case, the Court expressly found that in fact and in law, the arbitrator was validly appointed and as sole arbitrator, he properly embarked upon the reference - see pages 4 to 6 of the judgment. I have, however, out of indulgence for the benefit of the Respondents decided to address this issue again so that it can, I hope, be finally put to rest.

Let me say straight away that it is legally incorrect for the Respondents to contend, as they now do, that the Award is futile and not binding upon them because, as they claim, the arbitrator was not appointed in accordance with section 6 of the Arbitration Act.

This Court found in the judgment referred to above that it was the failure of the Respondents in either naming their own arbitrator or concurring in the selection of a single arbitrator even after formal notice by the Applicant to do so that resulted, by virtue of section 7 of the Arbitration Act in the appointment of the Arbitrator as sole Arbitrator by instrument dated 15th October 1999 by the Applicant.

The Arbitrator in the Reasons for Award dated 30 April 2000 recounts in paragraphs 1.1 and 1.6 how he came to be appointed and to embark on the reference.

I am therefore satisfied that in the circumstances of this case, given the stance of non-cooperation of the Respondents as recounted by the Arbitrator and in the light of the provisions of the submission between the parties, as contained in clause 8 of their agreement, the Arbitrator was validly appointed pursuant to section 7 of the Arbitration Act, in particular, paragraph (b) thereof.

Clause 8 of the Agreement provides:

"Any dispute or difference arising between the parties hereto during the course of this contract or at the termination hereof, as to the construction of this agreement or as to any matter or thing of whatever nature arising hereunder or in connection therewith, then such dispute or difference shall be and is hereby referred to the arbitration and final decision of a person to be agreed between the parties. In default of agreement in selecting a single arbitrator the dispute shall be referred to two arbitrators one to be appointed by each party. Before entering on the reference each of the arbitrators shall appoint an Umpire who shall preside over the Arbitration and shall decide in the dispute in the event of difference between the two arbitrators."

And section 7(b) of the Act provides:

"if, on such reference, one party fails to appoint an arbitrator, either originally or by way of substitution as aforesaid, for seven clear days after the other party, having appointed his arbitrator, has served the party making default with notice to make the appointment, the party who has appointed an arbitrator may appoint that arbitrator to act as sole arbitrator in the reference, and his award shall be binding on both parties as if he had been appointed by consent."

In the premise therefore, I hold that the Arbitrator was validly appointed, he had jurisdiction to embark upon and proceed upon the arbitration that resulted in the Award dated 1st September 2000 and that the Award is not futile and is binding on the Respondents. This Award, it should also be remembered, was as a result of the remission of the initial Award by the order of the Court to the Arbitrator.

THE ALLEGED MISBEHAVIOUR BY THE ARBITRATOR AND NON-PUBLICATION OF THE AWARD.

I now turn to the objections of the Respondents that the arbitrator did not publish the Award as he was directed by the Court and that he misbehaved himself in the conduct of the proceedings by hearing only the Applicant on 16th August 2000 as the Respondents were neither notified nor took any part.

First, on the issue of publication or notification of the Award, it is the law that unless the Arbitration agreement so stipulates, publication to the parties is not necessary for the validity of an Award - Mustill & Boyd, Commercial Arbitration (2nd Ed. 1989) at page 383.

In the instant case, the Court did order in its judgment of 6th July 2000 remitting the initial Award for a reconsideration by the arbitrator that he must make and publish his Award not later than three calendar months from the date of that Order.

On the evidence before me, however, I am satisfied that the Final Award was published to all the parties: see in particular paragraph 8 of the Applicant's Affidavit of 5th October 2000; and paragraphs 36, 38, 40, 41 of the Affidavit of Victor Espat for the Second Respondent dated 7th February 2001; and paragraphs 22, 24 and 25 of the Affidavit dated 7th February 2001 of Tracy Taegar for the First Respondent.

In any event, it is manifestly clear that all the parties are in receipt of the Final Award of the arbitrator. I am therefore further satisfied that in the circumstances of this case, the issue of the exact date of publication or notification of the Final Award, is really de minimis, and cannot properly be a ground to impugn it or a bar to the grant of leave for its enforcement.

Secondly, on the issue of the alleged misbehaviour of the Arbitrator. This aspect of the Respondents' objections did cause me some anxiety. It is intrinsic in proper arbitration proceedings that all the parties must be given notice of the hearing and have the opportunity of presenting their respective case to the arbitrator - Montrose Canned Foods Ltd. v Eric Wells (Merchants) Ltd. (1965) 1 Lloyd's Rep. 597.

The source of my anxiety and puzzlement in the instant case however, is that it is not clear quite how the arbitrator conducted the proceedings that resulted in his Final Award of 1st September 2000.

What, of course, is beyond doubt is that the Arbitrator became seized again of the matter as a consequence of the order of the Court of 6th July 2000 remitting his initial Award for a reconsideration.

However, neither in the Final Award dated 1st September 2000 nor in the annexure thereto wherein, among other things, the history of the Applicant's claim and dispute with the Respondents is recounted, is there any indication or statement that the Respondents were notified of or participated in the proceedings before the Arbitrator as a consequence of the remission to him by the Order of the Court dated 6th July 2000.

Instead, the Arbitrator states in paragraph (8) of his Final Award:

"In consequence of the said Order, an oral hearing took place on 16th August 2000 at which the Claimant (that is the Applicant in these proceedings before me) and his legal advisers appeared before me."

Also, the Arbitrator does not state or make it clear either in his Final Award of 1st September 2000 or in the document annexed thereto whether notice of hearing after the remission was ordered, was ever given to the Respondents, and if so, their response, if any. But it is clear that the Applicant's attorneys were present thereat and in fact made submissions to him - see paragraphs 9.2 and 9.3 of the document attached to his Final Award.

The Respondents have however, on the other hand, each complained that they had no notice of, nor participated in, the hearing by the Arbitrator on 16th August 2000 - see paragraphs 42 and 45(8) of Victor Espat's Affidavit; and paragraph 27 of Tracy Taegar's Affidavit mentioned supra.

These are in my view serious allegations, and they have not been controverted nor explained.

It is perhaps understandable and possibly feasible that given the history and stance of non-cooperation the Respondents had assumed, as stated earlier in this judgment, towards the whole proceedings between them and the Applicant, it was thought that notice of the hearing before the arbitrator consequent on the remission, was not necessary.

However, with respect, the arbitrator should not take it for granted that he could dispense with notice, merely because one party has shown a disposition to ignore the arbitration altogether - Mustill & Boyd, op. cit at page 303; and Montrose Canned Foods Ltd. v Eric Wells supra.

It is therefore clear that there would be an irregularity in the proceedings if the arbitrator, for one reason or the other, failed to give notice of the time and place of the meeting to proceed on the reference - Oswald v Earl Grey (1885) 24 L.J.Q.B. 600.

Although I have mentioned the stance of non-cooperation adopted by the Respondents in regard to both the Applicant concerning the reference and to the arbitrator himself in respect of the proceedings thereon in so far as those proceedings culminating in the initial Award of 30th April 2000 were concerned, there is no evidence however, before me, that they had notice of or much less participated in the proceedings before the arbitrator on his reconsideration as a result of the remission of the Award to him by the Court.

The evidence before me is that at this crucial meeting (which in all the circumstances, it is fair to so describe it) held on 16th August 2000 at the Radisson Fort George Hotel, only the Applicant's attorneys appeared before the arbitration and made submission - see paragraph 42 of Victor Espat's Affidavit and Exhibit "CF3" and paragraph 8 of the Final Award dated 1st September 2000 and paragraph 9.2 and 9.3 of the document attached to the Final Award dated the same day.

In my view, the duty to give notice to both sides of the proceedings, and if possible, to hear them, should apply as much to the original proceedings as well as to the proceedings on the reference as a result of remission of the Award by the Court.

But this did not happen in this case. In consequence, I hold that fair play and justice would require that the Respondents at the least, be apprised by the arbitrator by notice of the time and place of the meeting for a reconsideration of his Award remitted by the Order of the Court. As Megaw J. stated in the Montrose case supra at page 602:

". . . it is incumbent upon arbitrators to take steps to ensure, so far as is reasonably possible, before they make an Award, that each of the parties to the dispute before them know the case which has been put against them, and has had the opportunity to put forward that party's own case."

It was therefore incumbent, in my judgment, upon the arbitrator on the order of remission, to have, at least, informed the Respondents of the time and place of the meeting at which he would reconsider the Award and to have afforded both the Applicant and the Respondents the opportunity to put, if they chose and could, their respective sides.

This I hold is vital especially on the issue of quantum of damages that was remitted to him for reconsideration.

I cannot help but notice that in his Final Award, the arbitrator in addition to awarding the Applicant the sum of $105,149.16 representing part of the special damages claimed by him, also awarded him as a result of the remission, the sum of $1,300,000.00 by way of general damages for the breach of his contract by the Respondents.

The measure of damages by which the arbitrator arrived at this latter sum and the amount itself may or may not be right; but it is not for this Court to substitute its own views or figures as to what the correct measure or appropriate quantum of damages should be.

But however, equity, fairness and principle would require that the Respondents should have been notified of the time and place of the meeting by the arbitrator to determine the issue and quantum of damages as remitted to him by the Court, and to have been afforded the opportunity to present their own side.

On the evidence, this did not happen in this case. What seems to have happened is that through what can be described as a procedural mishap, the Respondents did not seem to have been apprised of or afforded the opportunity to take part in the reconsideration by the Arbitrator on the remission ordered by the Court.

It would therefore, in my view, not be right or equitable, to let the Final Award as it stands and arrived at in the circumstances I have described, go forward. To lend the coercive powers of the Court in virtue of section 13 of The Arbitration Act - Chapter 69, to an Award that does not seem to have proceeded from a fair trial would not be proper. Fair trial is as much a requirement of arbitral proceedings as of ordinary litigation.

See generally, Mustill and Boyd op. cit at pages 299 to 312 on the requirements of fair trial in arbitral proceedings, including in particular, the notification of the hearing to each party.

That this procedural mishap might have been induced or contributed to by the hands-off posture or even defiance of the Respondents towards the whole arbitral proceedings between them and the Applicant, does not of itself, justify the absence of notification to them of the time and place of the meeting of the arbitrator following the remission to him of his initial Award.

This failure to notify the Respondents of the time and place of the meeting for a reconsideration of the Award could, as they have complained in their objection, be a misconduct in the technical sense - see Halsbury's Laws of England 4th Edition, Vol. 2, paragraph 622; and Russell on Arbitration (18th ed.) at p. 378.

I hasten to add for the purposes of this case and respectfully adopting the view of the learned authors in Volume 1 Chitty on Contracts (27th Edition 1994) at page 751 at paragraph 15-042 that:

"Misconduct in arbitration law does not necessarily imply any reflection on the competence or integrity of the arbitrator: it covers irregularities or procedural unfairness which is not proper in relation to quasi-judicial proceedings."

No reflection in the slightest is, I am confident, intended or can be implied by the Respondents or anyone else for that matter on the competence or integrity of the arbitrator in this case.

"Misconduct" however, by an Arbitrator may be a ground for setting aside his Award - see section 12(2) of the Arbitration Act.

In the instant case however, the Respondents have not expressly asked for the Final Award to be set aside, although the effect of their several objections, including this one on the technical misconduct of the arbitrator occasioned by what I have referred to as a procedural mishap, would, if valid, produce that result if the Court were to so order.

I therefore ask myself the question: should the Final Award in all the circumstances of this case, especially in the light of the procedural mishap which may amount to a technical misbehaviour, be set aside or remitted?

I have carefully pondered this question and have come to the conclusion on the principle of The Montan (1985) 1 W.L.R. 625 and King v Thomas McKenna (1991) 2 W.L.R. 1234, that it would be more appropriate, in all the circumstances of this case, not to set aside the Final Award of 1st September 2000 but instead to remit it to the arbitrator.

Moreover, the question whether an Award should be remitted or set aside altogether is one for the Court's discretion - Halsbury's Laws, ibid at paragraph 615. The power of the Court to remit an Award is now taken as general: see the judgment of Lord Donaldson of Lymington M.R. in Thomas McKenna supra, especially at p. 1243.

In case I detect a feeling of deja vu, let me say that I draw comfort and succour for this course of action from the provisions of section 11(1) of the Arbitration Act which states:

"In all cases of reference to arbitration the Court may from time to time remit the matters referred or any of them, to the reconsideration of the arbitrator or umpire." (emphasis added)

In response to the Applicant's request for leave to enforce the Final Award of 1st September 2000, I am of the view that in the light of my conclusion on the score of the procedural mishap by the arbitrator in arriving at this Award, it would not be fair for now to allow this Award to take effect without further consideration by the Arbitrator of the issue of the quantum of general damages and without the Respondents having had the opportunity to know of and participate in, if they so choose, the proceedings to decide this crucial issue.

In the event therefore, I order that the sole issue of the quantum of general damages be remitted to the Arbitrator for reconsideration with an opportunity to both the Applicant and the Respondents to put their respective views before him for his determination, with liberty to the Applicant to apply thereafter for the Order he now seeks, if necessary.

Finally, given the history and stance of non-cooperation of the Respondents as recounted in this judgment, but more particularly in view of the fact that none of the objections raised by the Respondents, bar the one on misconduct, has been held by me to be valid, it is only fair, I think, that the Respondents bear the costs occasioned by these proceedings before me.

I therefore Order that the Respondents shall pay costs to be taxed if not agreed.

A. O. CONTEH
Chief Justice

DATED: 6th June, 2001.