Wakilii

Waatunga v Finca Uganda Limited (Civil Miscellaneous Application 4 of 2024)

High Court · [2025] UGHC 314 · 2025 Application Dismissed AI-generated summary ↓ Download Pin to watchlist Add to matter
Jurisdiction
Uganda
Case Type
Application to set aside arbitral award under Section 34 of the Arbitration and Conciliation Act
Decision
Application to set aside arbitral award dismissed

Observed later treatment

No later-treatment classification is recorded for this judgment.

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Holding

Held that the application to set aside the arbitral award failed on all grounds. The court found no evidence of manifest partiality by the arbitrator, as the applicant failed to demonstrate justifiable doubts about impartiality under the objective test. The grounds relating to public policy and banking tradition were disguised appeals on the merits, which fall outside the limited scope of judicial review under Section 34 of the Arbitration and Conciliation Act. While the arbitrator delivered the award beyond the two-month statutory period, this delay was not an actionable ground for setting aside an award under Section 34, and the arbitrator had statutory power to enlarge time under Section 31(1). Application dismissed with costs to the respondent.

Outcome

Application to set aside arbitral award dismissed

Facts

The applicant obtained a loan of UGX 150,000,000 from the respondent on December 11, 2018, and a subsequent facility of UGX 170,000,000 on November 11, 2019. The applicant defaulted on the loan. The respondent filed High Court Civil Suit No. 6 of 2021, which was referred to arbitration under Clause 15 of the loan agreement. Both parties agreed to the appointment of a sole arbitrator on October 25 and 27, 2021, and agreed to pay arbitration fees of UGX 14,000,000. The arbitrator made an award on March 12, 2024, finding the applicant owed UGX 123,024,176 with interest at 24% per annum from February 20, 2020. The arbitrator ordered the applicant to pay UGX 7,000,000 in arbitration fees. The applicant filed this application on April 4, 2024, seeking to set aside the award on grounds of partiality, public policy violations, and delay in rendering the award.

Issues

  1. Whether the arbitrator was manifestly partial in the conduct of the arbitration process and the award itself.
  2. Whether the arbitral award was against public policy.
  3. Whether the arbitrator failed to take into account matters of great public policy in the banking tradition and the contract itself.
  4. Whether the arbitral award was given out of time contrary to the Arbitration and Conciliation Act.
  5. Whether it is just and equitable to set aside the arbitral award.

Orders

  • Application dismissed.
  • Costs awarded to the respondent.

Rules and key headnotes

Arbitration & ADR — Setting Aside Awards — Grounds Under Section 34 — Limited Scope of Judicial Review
Recourse to court against an arbitral award may be made only by an application for setting aside under the grounds specified in Section 34(2) and (3) of the Arbitration and Conciliation Act. The language is directive and mandatory, and the scope of judicial review is very limited and does not extend to the merits of the claim.
Arbitration & ADR — Bias and Impartiality — Test for Apparent Bias
An allegation of bias against an arbitrator must show justifiable doubts about the arbitrator's impartiality. The applicable test is an objective one: whether a fair-minded and informed observer, having considered the facts, would conclude there was a real possibility that the tribunal was biased. A factual statement by an arbitrator about non-payment of fees, without more, does not constitute actionable bias.
Arbitration & ADR — Time Limits — Arbitrator's Power to Enlarge Time
Under Section 31(1) of the Arbitration and Conciliation Act, an arbitrator has statutory power to enlarge the time for making an award beyond the two-month period by a writing signed by the arbitrator. Failure to render a timely decision under Section 31(1) is not an actionable ground for setting aside an award under Section 34(1) of the Act.
Arbitration & ADR — Time Limits for Challenging Awards — Section 34(3)
An application for setting aside an arbitral award may not be made after one month has elapsed from the date on which the party making the application received the arbitration award. An application filed within one month is timely and properly before the court.
Arbitration & ADR — Public Policy — Disguised Appeals on Merits
Grounds alleging that an arbitral award is against public policy or that the arbitrator failed to take into account matters of public policy, which in substance challenge the arbitrator's interpretation of the contract or award of interest and costs, are disguised appeals on the merits and fall outside the limited grounds for setting aside an award under Section 34 of the Arbitration and Conciliation Act.

Legislation cited (5)

Cases cited (2)

  • Halliburton v Chubb [2021] AC 1083
  • Hohenshelt v Superior Court of Los Angeles County (2024) 318 Cal.Rptr.3d 475

Full judgment

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Waatunga v Finca Uganda Limited (Civil Miscellaneous Application 4 of 2024) [2025] UGHC 314 (21 May 2025)
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.