Wakilii

Mbarara University of Science & Technology v Block Technical Services Limited (Miscellaneous Application 397 of 2022)

High Court · [2023] UGHC 273 · 2023 Application Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Application arising from Civil Suit No. 101 of 2022 seeking to refer dispute to arbitration under Arbitration and Conciliation Act
Decision
Application dismissed with option for parties to voluntarily refer dispute to ICAMEK for arbitration

Observed later treatment

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Holding

The court held that the contract contained no clear arbitration clause requiring automatic referral to arbitration. While clauses 34.1-34.4 of the General Conditions of Contract provided procedural mechanisms for dispute resolution, they did not constitute a specific submission to arbitration where parties agreed disputes would be referred to an arbitrator. The court distinguished between adjudication provisions (for disputes about project manager decisions under clause 33.1) and general dispute resolution. The application to refer the matter to arbitration was dismissed, though the court offered the parties the option to voluntarily refer the dispute to ICAMEK for arbitration.

Outcome

Application dismissed with option for parties to voluntarily refer dispute to ICAMEK for arbitration

Facts

The applicant (defendant in the main suit) sought to have Civil Suit No. 101 of 2022 dismissed and the dispute referred to arbitration under the Arbitration and Conciliation Act, arguing that the contract between the parties contained a valid arbitration clause. The contract's Special Conditions specified that the procedure for settling disputes shall be CADER and that arbitration shall be conducted in accordance with the Arbitration and Conciliation Act in Kampala. The respondent (plaintiff) opposed, arguing that the arbitration provisions only applied after adjudication of disputes concerning project manager decisions under clause 33.1, and that the main suit concerned breach of contract with no reference to project manager decisions. A preliminary issue arose regarding whether Justice Mubiru had already ruled on the arbitration clause when the matter was previously before the Commercial Division, but the court found that ruling had not been completed as the judge did not have the file.

Issues

  1. Whether there is an arbitration agreement between the parties and if so, whether the arbitration agreement is valid and enforceable against the parties?
  2. What are the remedies to the parties?

Orders

  • Application dismissed.
  • Should the parties so decide, the matter can be referred for arbitration to the International Center for Arbitration and Mediation (ICAMEK) in accordance with clauses 34.1-34.4 GCC to be concluded within 90 days of such decision.
  • The costs of the suit shall abide the outcome of the arbitration.
  • Each party shall bear their own costs of the instant application.

Rules and key headnotes

Arbitration & ADR — Arbitration Agreements — Validity and Enforceability — Requirement for Clear Submission to Arbitration
For a court to refer a dispute to arbitration, there must be a clear arbitration clause in the contract where the parties agree that in the event of specified disputes, they shall be referred to an arbitrator. Provisions of procedure alone, without specific submission to arbitration, are insufficient to constitute a valid arbitration agreement.
Contract Law — Interpretation — Special Conditions and General Conditions — Relationship Between Clauses
Where a contract contains both General Conditions and Special Conditions, and the Special Conditions state they shall supplement the General Conditions with their provisions prevailing in case of conflict, the court must read the conditions together to determine the parties' intentions regarding dispute resolution mechanisms.
Arbitration & ADR — Adjudication Distinguished from Arbitration — Scope of Dispute Resolution Clauses
A contract clause providing for adjudication of disputes regarding project manager decisions is distinct from a general arbitration clause. Where the contract specifies that certain disputes (such as those concerning project manager authority or wrongful decisions) shall be referred to an adjudicator, with arbitration available only as an appeal from the adjudicator's decision, this does not constitute a general arbitration agreement covering all contractual disputes.
Civil Procedure — Scheduling Conference — Court's Power to Refer Parties to Alternative Dispute Resolution
Under Order 12 rule 1 of the Civil Procedure Rules, the court shall hold a scheduling conference to sort out points of agreement and disagreement, and consider the possibility of arbitration, mediation and any other form of settlement. Where both parties express willingness to settle out of court, the court may refer the parties to Alternative Dispute Resolution methods by order under Order 47 of the Civil Procedure Rules, even where no binding arbitration agreement exists.

Legislation cited (6)

Cases cited (3)

  • Yaya Farajallah v Obur Ronald & 3 Others (Civil Appeal No. 0081 of 2018)
  • Panyimur Rural Co-operative Savings and Others v The Microfinance Support Centre (Miscellaneous Application No. 14 of 2014)
  • Dott Services Ltd v Uganda National Roads Authority & Another (Miscellaneous Cause No. 228 of 2017)

Full judgment

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

Mbarara University of Science & Technology v Block Technical Services Limited (Miscellaneous Application 397 of 2022) [2023] UGHC 273 (10 May 2023)
Source: this page presents Wakilii’s issue analysis and metadata for a publicly reported Ugandan judgment. Any AI-generated summary is marked as such. Judgment text is sourced from the Uganda Legal Information Institute (ulii.org). Wakilii is not affiliated with ULII.