Introduction
This is an additional article to the ones I have written before on arbitration. In this article I look at what is involved in the making of an arbitral award and termination of the arbitration proceedings in terms of the Arbitration Act (Chapter 7:15), “the Act”. I look at the following:
- Rules applicable to substance of dispute
- Decision making by panel of arbitrators
- Settlement
- Form and content of award
- Termination of proceedings
- Correction and interpretation of award.
Rules applicable to substance of dispute
According to Article 28 of the Arbitration Act the arbitral tribunal shall decide the dispute in accordance with such rules of law as are chosen by the parties as applicable to the substance of the dispute. Any designation of the law or legal system of a given State shall be construed, unless otherwise expressed, as directly referring to the substantive law of that State and not to its conflict of laws rules. If there is no designation by the parties, the arbitral tribunal shall apply the law determined by the conflict of laws rules which it considers applicable. The arbitral tribunal shall decide ex aequo et bono or as amiable compositeur only if the parties have expressly authorised it to do so.
(4) In all cases, the arbitral tribunal shall decide in accordance with the terms of any contract and shall take into account any usages of any trade applicable to the transaction.
ARTICLE 29
Decision-making by panel of arbitrators
In arbitral proceedings with more than one arbitrator, any decision of the arbitral tribunal shall be made, unless otherwise agreed by the parties, by a majority of all its members. However, questions of procedure may be decided by a presiding arbitrator, if so authorised by the parties or all members of the arbitral tribunal.
ARTICLE 30
Settlement
(1) If, during arbitral proceedings, the parties settle the dispute, the arbitral tribunal shall terminate the proceedings and, if requested by the parties and not objected to by the arbitral tribunal, record the settlement in the form of an arbitral award on agreed terms.
(2) An award on agreed terms shall be made in accordance with the provisions of article 31 and shall state that it is an award. Such an award has the same status and effect as any other award on the merits of the case.
ARTICLE 31
Form and contents of award
(1) The award shall be made in writing and shall be signed by the arbitrator or arbitrators. In arbitral proceedings with more than one arbitrator, the signatures of the majority of all members of the arbitral tribunal shall suffice, provided that the reason for any omitted signature is stated.
(2) The award shall state the reasons upon which it is based, unless the parties have agreed that no reasons are to be given or the award is an award on agreed terms under article 30.
(3) The award shall state its date and the place of arbitration as determined in accordance with article 20 (1). The award shall be deemed to have been made at that place.
(4) After the award is made, a copy signed by the arbitrators in accordance with paragraph (1) of this article shall be delivered to each party.
(5) Unless otherwise agreed by the parties—
(a) the costs and expenses of an arbitration including the legal and other expenses of the parties, the fees and expenses of the arbitral tribunal and other expenses related to the arbitration, shall be as fixed and allocated by the arbitral tribunal in its award;
(b) where the award does not specify otherwise, each party shall be responsible for his own legal and other expenses and for an equal share of the fees and expenses of the arbitral tribunal and any other expenses related to the arbitration.
(6) Unless otherwise agreed by the parties—
(a) an arbitral tribunal may award interest at such rate, on such sum and for such period as may be specified in the award;
(b) where the award does not specify otherwise, a sum directed to be paid by the award shall carry interest from the date of the award up to the date of payment at the same rate as a judgment debt.
(7) Unless otherwise agreed by the parties, an arbitral tribunal shall have the power to make an interim, interlocutory or partial award.
ARTICLE 32
Termination of proceedings
(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.
(2) The arbitral tribunal shall issue an order for the termination of the arbitral proceedings when—
(a) the claimant withdraws his claim, unless the respondent objects thereto and the arbitral tribunal recognizes a legitimate interest on his part in obtaining a final settlement of the dispute;
(b) the parties agreed on the termination of the proceedings;
(c) the arbitral tribunal finds that the continuation of the proceedings has for any other reason become unnecessary or impossible.
(3) The mandate of the arbitral tribunal terminates with the termination of the arbitral proceedings, subject to the provisions of articles 33 and 34 (4).
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.
(5) The provisions of article 31 shall apply to a correction or interpretation of the award or to an additional award.
CHAPTER VII
Recourse Against Award
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
[amended by Act 14/2002 with effect from 4th February, 2002 – see s. 47 of 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
[amended by Act 14/2002 with effect from 4th February, 2002 – see s. 47 of 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.
CHAPTER VIII
Arbitration is part of alternative dispute resolution (“ADR”) mechanisms. In this article I look at what the Arbitration Act (Chapter 7:15) or “the Act” says on the conduct of arbitral proceedings. Part V of the Act covers the following areas:
- Equal treatment of parties.
- Determination of rules of procedure.
- Place of arbitration.
- Commencement of arbitral proceedings.
- Language.
- Statement of claim and defence.
- Hearing and written proceedings.
- Default of a party.
- Expert appointed by an arbitral tribunal.
- Court assistance in taking evidence.
Equal treatment of parties
According to Article 18 the parties shall be treated with equality and each party shall be given a full opportunity of presenting his case.
Determination of rules of procedure
This is covered in Article 19. Subject to the provisions of this Model Law, the parties are free to agree on the procedure to be followed by the arbitral tribunal in conducting the proceedings. If parties fail to agree, subject to the provisions of the Model Law, the arbitral tribunal may conduct the arbitration in such manner as it considers appropriate. This includes the power to determine admissibility, relevance, materiality and weight of any evidence. Every witness giving evidence, and every person appearing before an arbitral tribunal, shall have the same privileges and immunities as witnesses and legal practitioners in proceedings before a court.
Place of arbitration
According to Article 20(1) the parties are free to agree on the place of arbitration. Failing such agreement, the place of arbitration shall be determined by the arbitral tribunal having regard to the circumstances of the case, including the convenience of the parties.
Commencement of arbitral proceedings
According to Article 21 unless otherwise agreed by the parties, the arbitral proceedings in respect of a particular dispute commence on the date on which a request for that dispute to be referred to arbitration is received by the respondent.
Language
In terms of Article 22 (1) the parties are free to agree on the language or languages to be used in the arbitral proceedings. Failing such agreement, the arbitral tribunal shall determine the language or languages to be used in the proceedings. This agreement or determination, unless otherwise specified therein, shall apply to any written statement by a party, any hearing and any award, decision or other communication by the arbitral tribunal.
Statement of claim and defence
This is very important in arbitration. It is a requirement in terms of Article 23 that within the period of time agreed by the parties or determined by the arbitral tribunal, the claimant shall state the facts supporting his claim, the points at issue and the relief or remedy sought, and the respondent shall state his defence in respect of these particulars, unless the parties have otherwise agreed as to the required elements of such statements. The parties may submit with their statements all documents they consider to be relevant or may add a reference to the documents or other evidence they will submit. Subject to the agreement by the parties, either party may amend or supplement his claim or defence during the course of the arbitral proceedings, unless the arbitral tribunal considers it inappropriate to allow such amendment having regard to the delay in making it.
Hearing and written proceedings
Article 24 covers this area. In terms of Article 24(1) subject to any contrary agreement by the parties, the arbitral tribunal shall decide whether to hold oral hearings for the presentation of evidence or for oral argument, or whether the proceedings shall be conducted on the basis of documents and other materials. However, unless the parties have agreed that no hearing shall be held, the arbitral tribunal shall hold such hearings at an appropriate stage of the proceedings, if so requested by a party. It is a requirement in terms of Article 24(3) that all statements, documents or other information supplied to the arbitral tribunal by one party shall be communicated to the other party. Also any expert report or evidentiary document on which the arbitral tribunal may rely in making its decision shall be communicated to the parties. A party may appear in person or be represented.
Default of a party
Article 25 deals with situations where a claimant fails to communicate his claim in terms of Article 23(1), respondent fails to communicate his statement of defence in terms of Article 23(1) or any party fails to appear at a hearing or to produce documentary evidence.
Expert appointed by the arbitral tribunal
Article 26 empowers the arbitral tribunal to appoint one or more experts to report to it on specific issues to be determined by the arbitral tribunal.
Court assistance in taking evidence
In terms of Article 27(1) the arbitral tribunal or a party with the approval of the arbitral tribunal may request from the High Court assistance in taking evidence. The High Court may execute the request within its competence and according to its rules on taking evidence.
Conclusion
It is important for parties to arbitration to understand what the Arbitration Act says on the conduct of arbitral proceedings including in commercial arbitration.
Disclaimer
This simplified article is for general information purposes only and does not constitute the writer’s professional advice.
Godknows (GK) Hofisi, LLB(UNISA), B.Acc(UZ), Hons B.Compt (UNISA), CA(Z), MBA(EBS, Heriot- Watt, UK) is the Managing Partner of Hofisi & Partners Commercial Attorneys, chartered accountant, insolvency practitioner, registered tax accountant and advises on deal and transactions. He has extensive experience from industry and commerce and is a former World Bank staffer in the Resource Management Unit. He writes in his personal capacity. He can be contacted on +263 772 246 900 or gohofisi@gmail.com
