Uganda National Roads Authority v Multiline Construction Company Limited (Miscellaneous Cause 103 of 2023)
Observed later treatment
No later-treatment classification is recorded for this judgment.
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Holding
The High Court held that the arbitrator acted in contempt of court by proceeding as a sole arbitrator when the court had expressly ordered that the matter be handled by a panel of three arbitrators. The court declared that the arbitrator had no jurisdiction to hear the matter as a sole arbitrator and set aside the award. The court applied the principle that a party who knows of a court order cannot disobey it on the grounds that they regard it as irregular, and that a court cannot sanction what is illegal once it has been brought to its attention.
Outcome
Award set aside; matter remitted to arbitration by a panel of three arbitrators as originally ordered by the court
Facts
The parties entered into a construction contract which gave rise to a dispute. The dispute was referred to adjudication and subsequently to arbitration. The Respondent applied to court to appoint an arbitrator after CADER failed to do so. On 15 May 2023, the court ordered that the Respondent appoint an arbitrator within 2 weeks, who would together with Mr. Derrick Lufunya appoint a third arbitrator, and that the panel of three arbitrators should make their decision within 60 days. The Applicant was not served with the ruling. Mr. Lufunya proceeded as a sole arbitrator on the basis that the Applicant had not nominated an arbitrator within the 2 weeks. The Applicant objected to his jurisdiction but Mr. Lufunya dismissed the objection and proceeded to issue an award on 23 November 2023. The Applicant then brought this application challenging the arbitrator's jurisdiction.
Issues
- Whether the Learned Arbitrator had jurisdiction to hear the application as a sole arbitrator where the court had ordered arbitration by a panel of three arbitrators.
- Whether the affidavit sworn by Mr. Henry Muhangi should be struck off the record for lack of authority.
- Whether the court has jurisdiction to entertain the application where an arbitral award has already been issued.
- Whether the arbitrator acted in contempt of court by proceeding as a sole arbitrator contrary to the court's order.
Orders
- The award by Eng. Derrick Lufunya dated 17 November 2023 is hereby set aside.
- The Respondent to appoint an arbitrator within 2 weeks.
- The arbitrator appointed by the Respondent should together with Eng. Henry Alinaitwe appoint a third arbitrator within two weeks from the date of appointment.
- The arbitrators should make their decision within 90 days from the date of constitution of the panel.
- The Respondent shall pay the costs of the Applicant.
Rules and key headnotes
Legislation cited (5)
- Arbitration and Conciliation Act Cap 5 s.16(6)
- Arbitration and Conciliation Act Cap 5 s.10(2)
- Arbitration Rules r.13
- Civil Procedure Act Cap 282 s.98
- Civil Procedure Rules O.19 r.3(1)
Cases cited (3)
- Housing Finance Bank Ltd v Edward Musisi (Miscellaneous Application No. 158 of 2020)
- Makula International Ltd v His Eminence Cardinal Nsubuga & Anor [1982] HCB 11
- CHUK CREMET (1 Corp Jemp 342)
Full judgment
The original judgment as reported. Read the original PDF before relying on any passage.