Wakilii

SDV Transami Ltd v Agrimag Ltd and Anor (HCT-00-CC-AB 2 of 2006)

High Court · [2008] UGCOMMC 33 · 2008 Application Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Application to set aside arbitral award under the Arbitration and Conciliation Act
Decision
Arbitral award upheld; application to set aside dismissed

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

Held that an arbitral award may be set aside only on the grounds specified in s.34(2) of the Arbitration and Conciliation Act. Where parties agreed that the arbitrator's decision shall be final and made no provision for appeals on points of law, no such appeal lies. The arbitrator did not rewrite the contract by finding gross negligence on the basis of res ipsa loquitur; such finding was consistent with the contract's terms. The arbitrator decided a dispute contemplated by the parties and within the scope of arbitration. Special damages were sufficiently pleaded and proved. Application to set aside the award dismissed.

Outcome

Arbitral award upheld; application to set aside dismissed

Facts

The applicant carrier and the first respondent entered a written carrier agreement dated 1st February 1997. In 2000, a container of tea belonging to the first respondent disappeared between Kisumu and Eldoret while in the applicant's care for onward transmission to Mombasa. The second respondent (insurer) paid the first respondent UGX 56,817,600 as assessed loss. The first respondent subrogated its rights to the second respondent, who commenced arbitration proceedings against the applicant. The arbitrator awarded the second respondent UGX 57,914,550 as special damages, nominal damages of UGX 1,000, interest, and costs. The applicant applied to set aside the award, contending that a party was under incapacity (the first respondent being in liquidation) and that the award was not in accordance with the Arbitration Act.

Issues

  1. Whether the arbitral award should be set aside on the ground that a party to the arbitration was under some incapacity.
  2. Whether the arbitral award was not in accordance with the Arbitration and Conciliation Act.
  3. Whether the arbitrator rewrote the parties' contract by finding gross negligence when none was proved.
  4. Whether the arbitrator exceeded jurisdiction by deciding a dispute not contemplated by the parties or beyond the scope of arbitration.
  5. Whether the award for special damages was contrary to law because the damages were not specifically pleaded and proved.

Orders

  • Application dismissed.
  • Costs of the application to the respondents.

Rules and key headnotes

Arbitration & ADR — Setting Aside Award — Grounds for Setting Aside
Recourse against an arbitral award may be made only by application for setting aside under s.34 of the Arbitration and Conciliation Act, and the court is authorised to set aside an award only on the grounds specified in that section.
Arbitration & ADR — Appeals on Questions of Law — Exclusion by Agreement
Where parties have agreed that the arbitrator's decision shall be final and have not provided for appeals on questions of law under s.38 of the Arbitration and Conciliation Act, no appeal on questions of law arising out of the award lies to the High Court.
Arbitration & ADR — Capacity of Parties — Scope of s.34(2)(a)(i)
The ground for setting aside an award under s.34(2)(a)(i) on the basis that a party was under some incapacity relates to the capacity or incapacity of a party to enter into the arbitration agreement at the time the agreement was made, not to events arising during or after the arbitration.
Arbitration & ADR — Jurisdiction of Arbitrator — Application of Contract Terms
An arbitrator does not rewrite a contract or exceed jurisdiction by making findings of gross negligence based on the doctrine of res ipsa loquitur where such findings are consistent with the terms of the contract governing liability; reframing issues for clarity does not alter the substance of what must be proved.
Arbitration & ADR — Standard Terms and Trade Usage — Notice Requirement
Where parties have a written contract setting out their terms and there is no evidence that one party had notice of the other's standard terms and conditions, an arbitrator does not err by declining to apply such standard terms or alleged trade usage.
Arbitration & ADR — Pleading and Proof of Special Damages — Adequacy of Particulars
A pleading that sets out particulars of special damages in the form of itemised amounts and attaches supporting documents, though inartistic, is sufficient to provide notice of the special damages claimed and to support an award of those damages where proved at arbitration.
Arbitration & ADR — Arbitral Award — Considerations of Justice and Fairness
Under s.28(4) of the Arbitration and Conciliation Act, an arbitral tribunal shall decide on the substance of the dispute according to considerations of justice and fairness without being bound by rules of law, except where the parties have expressly authorised it to apply rules of law.

Legislation cited (9)

Full judgment

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SDV Transami Ltd v Agrimag Ltd and Anor (HCT-00-CC-AB 2 of 2006) [2008] UGCommC 33 (18 June 2008)
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.