Jinja Produce & Millers Association Ltd & Ors v UMEME (U) Ltd [2017] UGSC 78

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

CADER held that where parties agree to arbitrate but fail for about a decade to constitute the tribunal, the appointing authority may invoke s.11(3)(b) of the Arbitration and Conciliation Act to appoint it. Because the dispute resolution clause was silent on the number of arbitrators, s.10(2) bound the parties to a sole arbitrator. Consolidation of parties in arbitration is a matter of party autonomy, not the joinder rules of the Civil Procedure Rules; absent any consolidation agreement, no blanket appointment covering all parties could be made. A separate single arbitrator was therefore to be appointed for each contract proved to contain the arbitration clause.

Outcome

A single arbitrator to be appointed for each contract proved to contain the arbitration clause, with the appointments to issue in a consequential ruling.

Facts

UMEME (U) Ltd contracted to supply electricity to the applicants' grinding mills in the Jinja Industrial Area. Problems arose in implementing the contracts, leading the applicants to seek arbitration. Each contract contained an identical clause referring disputes that could not be resolved amicably to arbitration under the Arbitration and Conciliation Act. From 2010 onwards the parties repeatedly failed to constitute an arbitral tribunal. The applicants applied to CADER for the appointment of an arbitrator. UMEME opposed the application, arguing that the applicants had failed to streamline the process for appointing a three-person panel, that the prescribed CADER procedures had not been followed, and that the application was therefore premature. Of the 28 named applicants, only some produced contracts evidencing the arbitration clause; the remainder produced only incorporation or business-name registration certificates. The clause did not specify the number of arbitrators, and no consolidation clause was evidenced.

Issues

1. Whether CADER should appoint an arbitrator where the parties had failed for about a decade to constitute the arbitral tribunal.
2. Whether the application was premature for failing to follow the prescribed CADER procedures and to streamline appointment of a three-person panel.
3. How many arbitrators should be appointed where the dispute resolution clause is silent on the number.
4. Whether the applicants could be consolidated in a single application for the appointment of an arbitrator.

Orders

• A single arbitrator to be appointed for every contract proved to contain the arbitration clause.
• Each appointment to be treated as if filed by a single application, with the attendant filing costs to be met by the affected applicants in respect of each appointment.
• The appointed arbitrator list to be issued in a consequential ruling.

Rules and key headnotes

Legislation cited (11)

• Arbitration and Conciliation Act Cap.4 s.10(2)
• Arbitration and Conciliation Act Cap.4 s.11(3)(b)
• Arbitration and Conciliation Act Cap.4 s.30
• Arbitration and Conciliation Act Cap.4 s.31
• Arbitration and Conciliation Act Cap.4 s.32(1)
• Arbitration and Conciliation Act Cap.4 s.58
• Civil Procedure Rules S.I.71-1 O.1 r.2
• Civil Procedure Rules S.I.71-1 O.1 r.6
• Civil Procedure Rules S.I.71-1 O.1 r.9
• Companies Act
• Business Names Registration Act

The original judgment as reported. Read the original PDF before relying on any passage.