Case Law[2025] ZMCA 39Zambia
Road Development Agency v Stefanutti Stocks And Consolidated Contractors Company Joint Venture (Appeal No.31 of 2024) (13 February 2025) – ZambiaLII
Judgment
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IN THE COURT OF APPEAL OF MBIA l EAL No. 31 of 2024
13 FEB 2025
HOLDEN AT LUSAKA ,
(Civil Jurisdiction)
VIL R[G1s,R
IN THE MATTER OF: AN APPLICATION FOR AN ORDER TO SET ASIDE AN
ARBITRAL AWARD
IN THE MATTER OF: SECTION 17 OF THE ARBITRATION ACT NO. 19 OF 2000
IN THE MATTER OF: RULE 23 OF THE ARBITRATION (COURT PROCEEDINGS)
RULES STATUTORY INSTRUMENT NO 75 OF 2001
BETWEEN:
ROAD DEVELOPMENT AGENCY APPELLANT
AND
STEFANUTTI STOCKS AND CONSOLIDATED
CONTRACTORS COMPANY JOINT VENTURE RESPONDENT
CORAM: SIAVWAPA JP, CHISHIMBA & PATEL, JJA
On 13th January & 13th February 2025
For the Appellant: Mr. C. Sianondo & Mr. G. Mileji
Messrs. Malambo & Co.
For the Respondent: Mrs. S. N. Wamulume & Mrs. A.C. Mwanga
Messrs. Ndemanga Mwalula & Associates
JUDGMENT
Patel, JA, delivered the Judgment of the Court.
Cases referred to:
1. Cash Crusaders Franchising (Pty) Limited v Shakers and Movers Zambia Ltd
(2012)ZRvol3, 174
2. Anderson Mazoka & Others v Levy Mwanawasa & Others (2005) ZR 138
3. Colgate Palmolive (Z) v Abel Sh emu Chika & 11 O Others
4. Fratelli Loci Sri Estrazion Minerarie v Road Development Agency -CAZ
AppealNo.112/2017
5. Savenda Management Services limited v Stanbic Bank Zambia Limited -SCZ
Appeal No. 37 of 2017
6. Peter Chinyama v Legina Hamukwele (sued as Administrator of the Estate of the late Davison Chipuba Chiinda) -SCZ Appeal No.10/2021
7. Gillian J<asempa Mutinta v New Future Financial Company Limited and
Another -SCZ Appeal No. 13 of 2023
8. Ossie Mangani Zulu v Robbie Phiri and Hellen M. Phiri - SCZ Appeal No. 165
of 2016.
9. Attorney General v Major Samuel Mbumwae and 1419 other officers and soldiers - SCZ Appeal No. 83 of 2010
10. Lovely Malumani v Lovely Malumani and Bonanza Cash Express Limited -
CAZ/08/330/2021
11. Sililo v Mend-a-Bath & Another - 2017 ZMSC 54.
12. JCN Holdings Limited v Development Bank of Zambia (2013) 3 ZR 299
13. Owners of the Motor Vessel "Lillian S" v Caltex Oil (Kenya) Limited (1989)
J<LR.19
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14. Modest Hamalabbi v Canaan Simaambo Mweetwa (sued in his capacity as
Administrator of the Estate of Late Jameson Hamooya) & Chrispin Hachoose
- CAZ Appeal No. 268 of 2023
15. lndeni Petroleum Refinery Co. Ltd v Kafco Oil Limited, and two others -SCZ
Selected Judgment No. 29 of 2017
16. Peter Chinyama v Legina Hamukwele -SCZ Appeal No. 10/2021
17. Wamulume Kalabo v Howard Mwape - CAZ Appeal No. 183 of 2023
18. Kon kola Copper Mines v Copperfields (201 O) ZR Volume 3 at page 156
19. Satyam Shivam Sundaram and Another v Given Chisakula Kawina -CAZ
Appeal No.076 of 2017.
20. Zambia Revenue AuthorityvTiger Limited and Zambia Development Agency
-SCZ Judgment No. 11 of 2016
21. Zimbabwe Electricity Supply Authority v Maposa (1992) 2 ZLR 452
22. PTAsuransi Jasa Indonesia (Persero) v Dexia Bank SA (2006) SGCA 41
23. Road Development Agency v Safricas Zambia Limited -SCZ Appeal No.
03/2024
24. Safricas Zambia limited v Road Development Agency - CAZ Appeal No. 17
/2023
25. ZCCM Investments Holdings Plc v Vedanta Resources Holding Limited and
Kon kola Copper Mines Plc (2022] ZMSC 1 O
26. Light Weight Body Armour v Sri Lanka Army (2007) Sri LR, 412
27. Clovegate Elevator Company Limited v Justice Mtshiya and Zimbabwe
Power Company (Private) Limited -Judgment No. 104/24, Civil Appeal No.
SC 662/23.
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Legislation referred to:
1. The Arbitration Act No. 19 of 2000
2. The Arbitration (Court Proceedings) Rules, S.I. No. 75 of 2001
3. The Convention on the Recognition and Enforcement of Foreign Arbitral
Awards New York, 1958 (The New York Convention)
4. The Court of Appeal Act No. 7 of 2016 and the Rules S.I. No. 65 of 2016
Texts and other materials referred to:
1. Redfern and Hunter, Law and Practice of International Commercial
Arbitration, third edition (London, Sweet & Maxwell 1999)
2. Dr. Patrick Matibini: Zambian Civil Procedure Commentary and Cases
(Volume 1, Lexis Nexis)
3. Bernstein's Handbook of Arbitration and Dispute Resolution Practice, by
John Tackaberry Q.C & Arthur Marriott Q.C, Fourth Edition Vol. 1 (Sweet &
Maxwell in conjunction with The Chartered Institute of Arbitrators)
4. Russel on Arbitration by David St. John Sutton & Judith Gill, 22nd Edition
(Sweet & Maxwell Limited)
5. Arbitration of Commercial Disputes International and English Law and
Practice by Andrew Tweeddale & Keren Tweeddale, (Oxford University
Press)
6. Kluwer Arbitration Blog by Wolters Kluwer-Article by Monique Sasson-June
18, 2022
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INDEX Page
1. Introduction J6
2. Background J6
3. Decision of the Lower Court Jg
4. The Appeal J1 1
5. Appellant's Heads of Argument in Support of the Appeal J12
6. Respondent's Heads of Arguments J14
7. The Hearing J15
8. Analysis & Decision of the Court on the Appellant's Jurisdictional
Issue J17
9. Decision of the Court on the Grounds of Appeal J26
10. Conclusion J46
JS
1 .0 INTRODUCTION
1.1 This is an appeal against the Judgment of Mbewe B. J; delivered on 29th
September 2023, in respect of an action commenced by the Appellant, (the
Applicant in the lower court), against the Respondent (the Respondent below) seeking an Order of Court to set aside the Arbitral Award (The Award)
dated 17th October 2022.
1.2 The learned Judge in the lower Court declined to set aside the Award.
1.3 This Appeal interrogates the role of the Court, in its supervisory and complementary capacity in the arbitral process. We remind ourselves of the limited jurisdiction we enjoy in hearing applications emanating from arbitral proceedings, and specifically, in an application to set aside an
Award and note from the onset that the role of the Court is not to attempt to re-write an Award or deal with attendant issues on appeal, which have the effect of examining the merits of the Arbitral Award.
1.4 The Appeal also presents an opportunity for the Court to pronounce itself on the propriety of an issue, raised from the Bar, and described as a
''Jurisdictional issue."
1.5 The Record of Appeal is presented in three volumes. Reference to page numbers shall refer to the Record of Appeal unless otherwise noted.
2.0 BACl<GROUND
2.1 For the purposes of this section, the parties shall be referred to as they are in this Court, or as RDA and Stefanutti Stocks respectively.
2.2 It is common cause that on or about 13th December 2016, the Appellant and
Respondent entered into a contract (RDA/CE/SP/012/15) for the construction of the l<alabo-Sikongo-Angola border gate road in extent of 85
Km in the Western Province of Zambia in an amount of ZMW959, 182,051.33
exclusive of VAT. (Hereinafter referred to as the Contract.)
2.3 Subsequently, a dispute arose between the Parties, following which
Stefanutti Stocks terminated the Contract effective 19th August 2019. On
10th March 2020, Stefanutti Stocks gave notice of intention to refer the matter to arbitration.
2.4 From a detailed scrutiny of the Record of Appeal, it would appear at volume
1 thereof that Stefanutti Stocks, as Claimant, referred the dispute to arbitration. This is seen from paragraphs 66 to 71 (pages 258 to 259) of what is the Statement of Claim which starts at page 236A and is mixed up with parts of RDA 's (the Respondent's) defence. On page 245A, under paragraph 33 of what would appear to be RDA's defence, the following is noted:
"The Respondent admits the contents of paragraphs 66 to 71 of the
Statement of Claim."
2.5 The Parties agreed on the appointment of the Arbitral Tribunal which rendered its Award on 17th October 2022, in favour of Stefanutti Stocks in the sum of ZMW510,082,413.25 divided into the respective currencies as set out in paragraph 102 of the Arbitral Award, seen at page 315A, interest and costs of the arbitration. (hereinafter referred to as the Award).
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2.6 On 8th December 2022, (not 2023 as stated in the Appellant's Heads of
Argument at page 2), the Appellant RDA, unhappy with the Award, filed its application byway of Originating Summons to set aside the Award pursuant to section 17 of the Arbitration Act on the following grounds:
1. That the said Award is contrary to public policy for:
(i) The logic, reasoning, interpretations and/or conclusions reached and adopted by the arbitral tribunal were incorrect, flawed and contrary to commercial, construction and business sense;
(ii) The arbitral tribunal did not reveal its 'mind over the matter' but merely adopted the Respondent's claims and submissions in their totality resulting in an injustice;
(iii) The Award consists of mistakes of law apparent from the face of the award.
2 The arbitral tribunal dealt with issues that went beyond the scope of the matters submitted for arbitration by alleging and delving into an unfounded allegation that an in-house advisor was tasked with the duty to prepare draft witness statements on behalf of the factual witnesses, which influenced the arbitral tribunal's Award.
2.7 This application has been indexed as pages 39 to 41 and the supporting affidavit from pages 42 to 330, Volume 1. (hereinafter referred to as RDA's
Application). It must be noted that the front page of the Originating
Summons, which ought to have been page 39 was missing from the Record and only found as a loose leaf in a few of the Records filed with the Court.
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2.8 RDA's list of authorities and skeleton arguments are noted from pages 331
to 340 of volume 2.
2.9 The Respondent, Stefanutti Stocks, affidavit in opposition to the Originating
Summons was filed on 17th February 2023. This is noted on page 345 to 644
in volume 2.
2.10 The Respondent's list of authorities and skeleton arguments are seen on pages 645 to 780 of volume 3.
3.0 DECISION OF THE LOWER COURT
3.1 Upon hearing RDA's Application, the learned Judge in the lower Court, delivered his Judgment on 29th September 2023 wherein he dismissed the application. The Judgment, now the subject of appeal, is noted on pages 14
to 38 of volume 1.
3.2 The learned Judge considered the documents filed by the parties as well as the arguments in support of and against the application. The application is made pursuant to section 17 and section 20 rule 7 of the Arbitration Act which said sections provide a party to an arbitration matter the right to seek to challenge the award and have it set aside on grounds contained in section
17 (A) (iii) seen at paragraph [38] (1 ), (2), (a), (i), (b) (i), page 32 of the Record.
3.3 In addressing his mind to the matter, the learned Judge noted that the application arose out of arbitration proceedings and that the role of the courts in arbitration proceedings is very limited as stated by Hon. Mr. Justice
Nigel Mutuna in Cash Crusaders Franchising (Pty) Limited v Shakers and
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Movers Zambia Ltd1 wherein he stated, in relation to what was an application for registration of arbitral awards:
" ... The complimentary role the courts play means that the courts merely assist the arbitral process to effective .... "
3.4 The learned Judge noted that he could not exercise appellate or review jurisdiction over the substantive issues of arbitration. Having reviewed the application and authorities closely, he guided himself on what facts must be shown before an Award is set aside on grounds of public policy.
3.5 In reading the Award and the parts complained against by the Appellant, the learned Judge disagreed with the Appellant that the Award falls short of the criteria set out above. He found that the Arbitral Tribunal explained itself in paragraphs 30 and 31 and also in interpreting paragraphs 69.1 and 69.4 of the Contract. He found the award to be well reasoned and not perverse in anyway.
3.6 The learned Judge turned to the next ground of the issue which was that the arbitration award delved into matters that were not before it and thus exceeded the scope of the arbitration. It was the Appellant's argument that this influenced the outcome of the arbitration.
3.7 The learned Judge noted that the fact that the Award made note of the manner in which the Appellant approached the arbitration by not engaging an expert witness and also that the Appellant's witness statements did not provide it much help, was in his view, fair comment on matters that were before it. It was his view that the comments were obiter and did not form
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part of the reasoning of the Tribunal. Additionally, he noted that Courts also make comments on the manner in which litigants present their cases before it where it is felt that it deseNes comment or highlighting.
3.8 After reviewing all aspects of the application to set aside the arbitral award, the learned Judge firmly concluded that the Appellant's application had not been substantiated on either ground and therefore, must be denied.
3.9 As such, the learned Judge dismissed the Appellant's Originating Summons to set aside arbitral award with costs to the Respondent, to be taxed in default of agreement.
4.0 THE APPEAL
Dissatisfied with the outcome in the Court below, the Appellant filed its
Notice and Memorandum of Appeal, on 9th February 2024, fronting two (2)
grounds of appeal, namely;
i. The learned Trial Judge erred in law and fact when he held that the
Arbitral Award was well reasoned and not perverse in any way without giving any reason for so concluding.
ii. The learned Trial Judge erred in law and fact when he held that the
Arbitral Tribunal's comments on the alleged manner in which the
Applicant approached the Arbitration by not engaging an expert witness were made obiter dicta and do not form part of the reasoning of the Tribunal when the said remarks in fact influenced the Arbitral
Tribunal's decision and formed part of the ratio decidendi.
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5.0 APPELLANT'S HEADS OF ARGUMENT IN SUPPORT OF THE APPEAL
5.1 We have duly considered and appreciated the Appellant's Heads of
Argument filed on 9th February 2024.
5.2 We have taken on board the arguments and submissions of Counsel, pertaining to ground 1, in which the Appellant has referred to paragraph 46
of the Judgment of the lower Court which is quoted as follows:
"In reading the Award and the parts complained against by the
Applicant, I cannot help but disagree with the Applicant the Award falls short of the criteria set out in the above case. I find that the
Arbitral tribunal explained itself in paragraphs 30 & 31 when interpreting paragraphs 69. 1 and 69.4 of the contract. /find the Award to be well reasoned and not perverse in any way."
5.3 It is the Appellant's argument that this holding is assailed as the construction of clauses 69.1 and 69.4 of the Contract was a critical part of the Arbitral proceedings since it is what determined what, if any, the
Respondent would be entitled to.
5.4 It is the Appellant's argument that the Arbitral Tribunal ascribed an interpretation to the said clauses, whose effect was contrary to the plain meaning or interpretation of the said clauses, thereby leading the Arbitrator to gravely misinterpret a crucial clause in the contract, which in itself warrants the Award to be set aside for being contrary to public policy. In support of its argument, the Appellant referred to the cases of Anderson
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Mazoka & Others v Levy Mwanawasa & Others2 and Colgate Palmolive
(Z) v Abel Sh emu Chika & 110 Others.
5.5 Further, the Appellant challenged at arbitration, the use by the Respondent of rates from a joint venture agreement between the Respondent and a third party as the same did not form part of the contract. It is the submission that the Award at paragraphs 36 and 37 stated that the Applicant's objections to the use of rates from the joint venture agreement were not well founded and cannot be sustained. It is their view that no proper reason or authority was provided save for the tribunal's view in the field of construction. It is the argument that this is contrary to elementary principles of the law of contract and falls squarely against public policy.
5.6 It is further the argument that the Award therefore meets the threshold for being set aside. Further, the Arbitral Tribunal merely adopted the evidence of the Respondent's expert witness and that thus am.enable to the argument that the award was contrary to public policy.
5.7 The Appellant argued that at the time when the Respondent terminated the contract, the work was approximately at only 18% overall progress. It is the submission that it is shocking to the conscience that the Arbitral Tribunal could award the sum of K510,082,413.25 from a total contract sum of
K959, 182,051.33 when only 18% of the work was completed. It is contended that the quantum of the Award is contrary to public policy.
5.8 With respect to ground two, it is the Appellant's argument that the comments made obiter dicta influenced the arbitral tribunal's decision and formed part of its ratio decidendi. It is the argument that the tribunal delved
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into matters beyond the scope of the matter before it. Also, the closing remarks of the Award made further findings, purportedly of fact, essentially blame the employees of the Applicant for the outcome of the proceedings.
It is the argument that the Arbitral Tribunal is bound to only make decisions based on issues raised before it and properly before it for its consideration.
6.0 RESPONDENT'S HEADS OF ARGUMENT
6.1 We have equally considered the Respondent's Heads of Argument filed on
25th February 2024.
6.2 In response to ground 1, the Respondent submitted that the learned Judge did not err in the manner he delivered his Judgment. On this line of submission, the Respondent relied on the decision of this Court in the case of Fratelli Loci Fri Estrazion Minesaiic v Road Development Agency4
.
6.3 It was the submission that the Judgment of the court below was well reasoned and in conformity with rules of procedure. It is also the submission that the learned Judge reviewed all the Affidavits filed by the parties and heard the arguments submitted at the hearing.
6.4 It was the Respondent's submission, that the Appellant had misapprehended the decision of the Supreme Court arrived at in the case of
Savenda Management Services Limited v Stanbic Bank Zambia
Limited5 It was argued that neither this Court, nor the lower Court could re
•
open Arbitral proceedings with a view to correcting the Award on its merits.
It is the Respondent's submission that mere proclamation of breach of public policy, is not sufficient to move the Court.
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6.5 It was submitted that there was nothing unconscionable, immoral or illegal nor unfair or commercially absurd with the Award, which was merely enforcing terms of the contract that the Parties had agreed in their contract of 13th December 2016.
6.6 The Respondent argued that from the perusal of the arbitral Award, the
Tribunal did not pluck the sum of ZMW 510,082,413.25 from the air, as suggested, but arrived at this figure after careful and logical consideration of the Contract between the Parties. The Respondent has contended that the Appellant merely seeks to have a "second bite at the cherry" and reopen the matter which was ably adjudicated upon by a competent and duly appointed Tribunal.
6. 7 In response to ground two, the Respondent submits that there is a deliberate attempt to mislead this Court to argue that the Award was influenced by the fact that witness statements were prepared by in-house counsel. It is the argument that the Tribunal reached its own decision after careful consideration of all facts before it. At no time did the Tribunal overstep the issues presented before it and further that the Tribunal always confined itself to the Contract. The Respondent submitted that the
Appellant had lamentably failed to demonstrate how the lower Court erred in its Judgment of 29th September 2023.
7.0 THE HEARING
7.1 At the hearing, Counsel Sianondo informed the Court that having filed their notice of appointment on 8th January 2025, they discovered some issues in the Record and informed the Respondent's Counsel. He was also alive to
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"
•
the decision of the Supreme Court which guided that a party cannot raise a preliminary issue in its own appeal. On this line of submission, he referred to the case of Peter Chinyama v Legina Hamukwele (sued as
Administrator of the Estate of the late Davison Chipuba Chiinda4 He
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applied that the Appellant be allowed to file an amended Memorandum of
Appeal to address the issue. It was his submission that the issue intended to be raised either as a proposed new ground of appeal or from the Bar, being a jurisdictional issue, was critical for the determination by the Court.
7.2 As a Court, we frown on applications made viva voce, at the start of the hearing, especially such as the intended application to amend the
Memorandum of Appeal, which by its necessary consequence, will give rise to a series of amendments, which will undoubtedly delay the determination of matters.
7.3 We have also not lost sight of the mandatory rules of this Court, namely
Order X and Order Xlll4, both of which require that a party wishing to raise a preliminary objection ought to do so by formal application.
7 .4 However, and in the interest of progressing the appeal and in the exercise of our discretion, noting that the Respondent was caught off guard, we allowed the Appellant to present what it termed the 'Jurisdictional issue' and argue its appeal on the Record before us. We also allowed the Parties seven working days each within which to file its written response and reply, if any, respectively.
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7 .5 As directed, the Respondent filed its skeleton arguments and list of authorities in opposition on 22 January 2025 and the Appellant filed its reply on 29th January 2025. The arguments have been fully appreciated and are not repeated here. They will be addressed and referenced as appropriate.
7.6 We shall address the issue raised and these submissions in the analysis section of our Judgment and obviously pronounce ourselves on the issue before we consider the grounds of appeal as presented in the Appeal, unless the same are rendered otiose.
7 .7 With respect to the appeal before the Court, Counsel Sianondo and Mileji placed reliance on the Record of Appeal and its heads of argument filed on
9th February 2024. Counsel Wamulume equally placed reliance on the
Respondent's heads of argument filed on 25th February 2024 in opposition to the appeal.
8.0 ANALYSIS AND DECISION OF THE COURT ON THE APPELLANT'S
JURISDICTIONAL ISSUE
8.1 In raising what it termed a 'jurisdictional issue', Counsel referred to a recent decision of the Supreme Court in the case of Gillian Kasempa Mutinta v
New Future Financial Company Limited and Another7 Counsel placed
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reliance on this case to argue the point that the Supreme Court raised a preliminary issue which was not raised by the Parties and was raised from the Record.
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8.2 Counsel referred the Court to page 47 of volume 1 and to the contract which contained the Arbitration clause. He invited the Court to look at page 236A
and note that the Respondent entity is un-incorporated and asked us to consider the effect of a non-existent company. In support of this line of submission, Counsel referred us to a decision of the Supreme Court in the case of Ossie Mangani Zulu v Robbie Phiri and Hellen M. Phiri8
•
8.3 It was further his submission that the Claimant in the arbitral proceedings, the subject of this appeal, and the Respondent before us, has had some incapacity in that it does not legally exist. He referred us to the decision of the Supreme Court in the case of Attorney General v Major Samuel
Mbumwae and 1419 other officers and soldiers9 in support of the argument that a Court is precluded from considering the interest of non parties to proceedings.
8.4 He referred to section 17 (1) of the Arbitration Act1 and submitted that recourse to a Court against an arbitral award may be made in accordance with subsections (2) and (3).
8.5 In opposing this issue, the Respondent has canvassed the argument that the issue raised by the Appellant is not a jurisdictional issue, and that it ought not to be treated as such. If anything, the issue is an attempt to raise new grounds of appeal, which are not in the Memorandum of Appeal, nor were they raised in the lower Court. We are alive to the settled authorities that speak to this cardinal point of law. To cite just a few are cases such as
Lovely Malumani v Lovely Malumani and Bonanza Cash Express
Limited10 and Sililo v Mend-a-Bath & Another 1 1 •
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8.6 It is only an issue that touches on jurisdiction that can be raised at any stage of the proceedings, including on appeal or execution. On the issue of jurisdiction, we make reference to celebrated cases such as JCN Holdings
Limited v Development Bank of Zambia12 where the Supreme Court stated as follows:
''It is clear from the Chikuta and New Plast Industries cases that if a court has no Jurisdiction to hear and determine a matter, it cannot make any lawful orders or grant any remedies sought by a party to that matter."
8.7 We find ourselves in agreement with this line of submission and refer to a decision of the Kenyan Court of Appeal rendered in the case of Owners of the Motor Vessel "Lillian S" v Caltex Oil (Kenya) Limited13 when it stated as follows:
"It is reasonably plain that a question ofJ urisdiction ought to be raised at the earliest opportunity and the court seized of the matter is then obliged to decide the issue right away on the material before it.
Jurisdiction is everything. Without it, a court has no power to make one more step. Where a court has no Jurisdiction, there would be no basis tor continuation of proceedings .... A court of law downs tools in respect of the matter before it the moment it holds the opinion that it is without Jurisdiction ....
Where the court takes it upon itself to exercise a Jurisdiction which it does not possess, its decisions amount to nothing. .. "
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8.8 It is argued by the Respondent that the status of the Respondent, and its legal capacity to contract, are not jurisdictional issues. A party's ability or power to enter into a contract cannot have a bearing on the Court's power to adjudicate the matter, such power being conferred by statute. It is also trite thatJurisdiction is a legislative function which can neither be conferred by consent nor by a superior court.
8.9 We are alive to issues of jurisdiction being raised at any stage even on appeal. We are also familiar with the recent decision of the Apex Court in the cited case of Gillian Kasempa Mutinta where the Court raised the issue of jurisdiction on its own motion. We rendered a similar Judgment in the case of Modest Hamalabbi v Canaan Simaambo Mweetwa (sued in his capacity as Administrator of the Estate of Late Jameson Hamooya) &
Chrispin Hachoose 14 wherein we raised the issue of jurisdiction viz the
, limited power of the Local Court to grant letters of administration.
8.1 O We are of the considered view that the issue termed as a jurisdictional issue, is in fact not a jurisdictional issue, as it relates purely to the capacity of the
Claimant in the Arbitral proceedings. The Appellant itself was at pains to categorize this issue. In its oral arguments in Court, it referred to it either as a preliminary issue, whilst immediately conceding that a Party cannot raise a preliminary issue to its own appeal and thereafter mounted it as a jurisdictional issue. At best, this issue, which we refer to as issue on capacity, ought to have been raised at the onset of the arbitral proceedings and ought to have been determined by the Arbitral Tribunal as an issue to its jurisdiction. It was also not raised as an issue before the lower Court.
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8.11 We are further fortified to arrive at this position based on the provisions of
Order X rule 3 of the Court of Appeal Rules4 It is clear that the notice of
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appeal shall state whether the whole or part only and what part of the
Judgment is appealed against. Order X rule 9 (2)4 also mandates that a memorandum of appeal shall set forth concisely and under distinct heads, without argument or narrative, the grounds of objection to the judgment appealed against.
8.12 We have paid close attention to the Notice of Appeal and the Memorandum of Appeal seen at pages 5 to 7 and nowhere is there any reference to the capacity of the Respondent, which has suddenly appeared to have assumed a trajectory of its own and catapulted as a jurisdictional issue. We are fortified to arrive at this conclusion by placing reliance on the decision of the Supreme Court in the case of lndeni Petroleum Refinery Co. Ltd v
Kafco Oil Limited, and two others 5 Any attempt to canvass this argument
1 .
before us, as a jurisdictional issue, is misleading and a blatant overreach on the part of the Appellant.
8.13 In any event, and purely for guidance in arbitral proceedings, a challenge must also be mounted in accordance with the Act. Article 4 of the First
Schedule to the Arbitration Act1 under the sub-heading Waiver of right to object, provides as follows:
"A party who knows that any provision of this Law from which the parties may derogate or any requirement under the arbitration agreement has not been complied with and yet proceeds with the arbitration without stating his objection to such non-compliance
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without undue delay or, if any time-limit is provided therefore, within such period of time, shall be deemed to have waived his right to object."
8.14 Article 16 of the First Schedule 1 gives the Arbitral Tribunal power to rule on its own jurisdiction, which plea must be raised no later than the submission in the statement of defence. A close reading of Article 16 under the heading
"competence of arbitral tribunal to rule on its own jurisdiction' clearly sets out the procedure to be invoked by any party challenging the jurisdiction, including any objections with respect to the existence or validity of the arbitration agreement. It is also fundamental to note that a party dissatisfied with the tribunal on its ruling on jurisdiction, may escalate the matter to
Court, which decision is not subject to further appeal.
8.15 Russell on Arbitration4 at paragraph 8-051, under the sub-heading 'Loss of right to object" guides as follows:
"A party who wishes to challenge an award for serious irregularity should not only act promptly in making his application to the court but should also take care not to lose his right to object. A party who takes part or continues to take part in the proceedings must state his objection to the irregularity either forthwith or within such time as is allowed by the arbitration agreement or the tribunal. That statement, which should be recorded in writing and sent to the tribunal and the other parties, should not only identify the irregularity, but also make clear that any further participation in the arbitration will be without prejudice to the objection. If that is not done, the party concerned
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may not be able to raise that objection before the court "unless he shows that, at the time he took part or continued to take part in the proceedings, he did not know or could not with reasonable diligence have discovered the grounds for the objection."
(Emphasis added).
8.16 However, and from the Record, we cannot help but note the attempt of the
Appellant to clutch at straws, as it mounts what it calls a jurisdictional challenge. From the passage quoted above from Russell on Arbitration, it is trite that the objection to capacity or jurisdiction of the Arbitral Tribunal should have been raised in the manner guided by Article 16 of the Model
Law.
8.17 We have painstakingly scrutinized the Record and have noted that the witness statement of Jonathan Philip Pells, the Respondent (claimant in the arbitration), confirms the following:
"5. During December 2016, Stefanutti Stocks Construction (Zambia)
Limited (SSCZ) and Consolidated Contractors Company (Kuwait)
W.L.L. ('CCC') ('the JV') entered into a Joint Venture Agreement ('the
JV Agreement') for the completion of the Contract. (item A3 Further
Discovery Bundle (FOB), p 214-258.)
8.18 We have also seen minutes of what is termed as a 'pre-contract negotiation'
meeting, held on 7th September 2016, between the RDA and Messrs.
Stefanutti Stocks/CCC Joint Venture. This is on pages 233/6.
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8.19 From several witness statements, tendered by their own witnesses, (see pages 520,563, 583, 616), the Appellant confirms the following:
"I am aware that Stetanutti Stocks Construction (Z) Limited and
Consolidated Contractors Company (CCC) entered into a Joint
Venture (JV) Agreement tor the completion of the Contract.
During the implementation of the Works, the Claimant was a accordingly considered as JV.'
8.20 Should this now be brandished as a jurisdictional issue, and one in which the Court should 'down tools for want ofj urisdiction' on account of capacity of the Respondent? A more misleading argument could not have been placed before the Court. This line of submission from the Bar lacks evidence to support it and the statements that we have captured in paragraph 8. 19
above are not sufficient for us to make a finding on the status or incapacity as alleged, of the Respondent. In a nutshell, this issue should have been placed before the arbitral tribunal as guided by the Arbitration Act and
Model Law referred to above. This is simply put, too little, too late.
8.21 We have also not lost sight of the fact that the Appellant is precluded from raising a preliminary issue in its own appeal, as settled by the case of Peter
Chinyama v Legina Hamukwele. This was conceded by Counsel Sianondo and hence termed a jurisdictional issue.
8.22 We must note, albeit with regret, and this observation permeates across the whole appeal, that the Record of Appeal is presented in the most unsatisfactory manner and is not befitting to be before this Court. We can catalogue but a few defects which have made the Record unnecessarily
J24
cumbersome and, in some places, impossible to follow. The pages are wrongly numbered, the documents do not flow, witness statements are muddled with other documents and the Appellant, (who was the
Respondent in the Arbitral proceedings), has numbered all its witness statements erroneously. For example, what should have been the
'Respondent's 5th Witness Statement', is entitled '5th Respondent's Witness
Statement'. This is repeated for all the witness statements. See pages 519,
562 and 615 of volume 2.
8.23 It is impossible to tell where the statement of claim (before the arbitral tribunal) begins, and where it ends. A classic observation is the Claimant's witness statement which is seen at page 495 of volume 2. Page 496 ends with paragraph 9 and page 497 starts with paragraph 12. The statement continues to· paragraph 102 on page 518 and paragraph 103 is finally discovered on page 564. The statement continues to page 577 at paragraph
141 and lo and behold, page 578 is another document and so on.
8.24 In our considered opinion, the attempt on the part of the Appellant at raising what it termed a Jurisdictional issue, was wholly inappropriate, and an example of the unnecessary 'fiddle-faddle' that is the hallmark of wasted time and resources in an attempt to undermine the Court's focus on resolving the merits of the appeal.
8.25 Without further ado, we dismiss this issue as being misplaced and an afterthought on the part of the Appellant. It is noted that the Appellant did enter into a Contract with the Respondent, which after a dispute was declared, resulted in the constitution of the arbitral tribunal which rendered
J25
an Award on the merits. At no stage, from the point of negotiation and execution of the Contract to the conclusion of the arbitral proceedings, and up to the point of applying in the lower Court for setting aside of the Award, was the issue of capacity of the Respondent raised by the Appellant. The only thing obvious is the attempt to set aside the Award by whatever means or grounds of appeal possible. The Court will not be a party to such orchestrations, more especially in light of its supervisory and complementary role in the arbitral process.
9.0 DECISION OF THE COURT ON THE GROUNDS OF APPEAL
9.1 As stated at paragraph 7 .6 above, the issue being dismissed, we will now proceed to consider the two grounds of appeal.
9.2 Although the Appellant has presented two grounds of appeal as noted in paragraph 4 above, the thrust of its appeal and its heads of argument presented place reliance on its application in the lower Court seeking an
Order to set aside the Award for being against public policy.
9.3 We noted in our recent Judgment in the case of Wamulume Kalabo v
Howard Mwape17 that the United Nations Commission on Trade Law
(UNCTRAL) adopted the Model Law on 21st June 1982 which applies in this
Country by virtue of section 8 of the Arbitration Act1 Article 5 of the Model
•
Law specifies very limited instances in which a Court would interfere in the decision of the parties to use arbitration as a dispute settlement method.
9.4 In keeping with the spirit of Article 5 of the Model Law, our Courts are enjoined to embrace the principle of limited. Court intervention in
J26
arbitration. As is well known, one of the chief benefits of judicial non intervention in arbitration is that it minimizes delays in the resolution of disputes. Obviously, the principal rationale for the non-interventionist stance is respect for party choice and autonomy.
9.5 As we consider the grounds of appeal, we are alive to the philosophy underlying the Arbitration Act. It is underpinned by its preamble as being 'to redefine the supervisory role of the courts in the arbitral process." The Act is clearly intended to restrict the Court's involvement in arbitration, to the extent only of providing a complementary and not competing role in the arbitral process.
9.6 The Arbitration Act was intended by legislature to foster commerce and provides for domestic and international arbitration through the adoption, with modifications, of the Model Law on International Commercial
Arbitration adopted by the United Nations Commission on International
Trade Law by giving parties to a commercial transaction the freedom to choose arbitration as their preferred dispute resolution forum.
9.7 The Supreme Court has cautioned superior courts in the manner and approach they adopt, so as not to exercise judicial activism at the expense of party autonomy.
9.8 Although both Parties have expended much time and energy to challenge and defend the reasoning of the lower Court, we are of the considered view that it was not within the purview of the lower Court to re-open an arbitral award in order to assess whether its reasoning was sound or based on
J27
factually sound principles. This principle was firmly settled by the Supreme
Court in the case of Konkola Copper Mines v Copperfields18
,
9.9 Speaking of the same principle of a Court not sitting to review an Award on its merits, we refer to a Judgment of this Court rendered in the cited case of
Fratelli Loci Sri Estrazion Minerarie v Road Development Agency, wherein we stated as follows:
"We cannot fault the lower court's finding on page 9 of the Judgment to the effect that she could not delve into issues of substance because it would defeat the whole essence of arbitration as an alternative dispute resolution mechanism. According to the lower court issues regarding the liability and quantum of damages are substantive and they were ably handled by the arbitral tribunal. In light of the case of
Konkola Copper Mines v Copperfields where it was held that: " An application to set aside an award is not intended for the court to review the award of the tribunal or indeed conduct a hearing akin to an appeal," we are of the considered view that the lower court was on firm ground."
9.10 The learned Authors Redfern and Hunter1 in the book Law on Practice of
,
International Commercial Arbitration state as follows:
"Arbitral rules such as those of UNCITRAL provide unequivocally that an arbitration award is final and binding. These are not intended to be mere empty words. One of the advantages of arbitration is that it is meant to result in the final determination of the dispute between the parties. If the parties want a compromise to be proposed they should
J28
opt for mediation. If they are prepared to tight, they should opt tor litigation. By choosing arbitration, the parties chose a system of dispute resolution that results in the decision that is in principle final and binding. It is not intended to be a proposal as to how the dispute might be resolved, nor is it intended to be the first step on a ladder of appeals through national courts."
9.11 The same principle of finality was echoed in our Judgment, rendered in the case of Satyam Shivam Sundaram and Another v Given Chisakula
Kawina19
.
9.12 The law is settled that it is not open to a dissatisfied party to ask a Court, trial or appellate, to open an Award. Once an award is rendered, it is final and binding upon the Parties. Sections 18 and 20 of the Arbitration Act1
clearly settle this position. It is also trite that mere protest of breach of public policy is not sufficient, there must be more.
9.13 It is canvassed by the Appellant that the Award in so far as it awarded damages to the Respondent amounted to gross injustice and thereby breached public policy. On this point, we have taken time to consider the decision of the Apex Court in the case of Zambia Revenue Authority v Tiger
Transport and Zambia Development Agency20 In this Judgment, the
.
Supreme Court cited with approval the Zimbabwean case of Zimbabwe
Electricity Supply Authority v Genius Joel Maposa21 where the Court stated:
"Where an award is based on so fundamental an error that it constitutes a palpable inequity that was so far reaching and
J29
outrageous in its defiance of logic or acceptable moral standards that a sensible and fair-minded person would consider that the conception of justice in Zimbabwe would intolerably be hurt by the award then it should be contrary to public policy to uphold it."
9.14 Although it is noted that the concept of public policy is not defined in the Act or the Model Law, the general consensus of judicial and expert opinion is that public policy under the Act encompasses a narrow scope. In the case of PT Asuransi Jasa Indonesia (Persero) v Dexia Bank SA,22the Court of
Appeal of Singapore, defined public policy as follows:
"In our view, it should only operate in instances where the upholding of an arbitral award would 'shock the conscience' or is 'clearly injurious to the public good or wholly offensive to the ordinary reasonable and fully informed member of the public' (or where it violates the forum's most basic notion of morality and justice)."
9.15 In our Judgment in the cited case of Fratelli Loci, we held that:
"The definition of public policy adopted in the Tiger Transport case shows that a very high standard of proof is set for a person applying to set aside an award on an a/legation that it is contrary to public policy.
Our view is that for an award to be set aside on that ground there must be proof that the arbitral tribunal has done gross injustice."
9.16 The Appellant has attempted to argue that the interpretation given to clauses 69.1 and 69.4 of the Contract, by the Arbitral tribunal, at pages 292
and 293, lends argument to the conclusion that the Award was contrary to
J30
public policy. It is the Appellant's argument that flaws in reasoning, both of the Arbitral Tribunal and the lower Court, are blatant examples of the portions of the Award that are clearly contrary to public policy.
9.17 The Appellant also appears to compare the case in casu with the decision taken by the Supreme Court when it set aside the award of damages made by the trial Court in the cited case of Savenda Management Services limited v Stanbic Bank Zambia Limited.
9.18 In the cited case of Zimbabwe Electricity Supply Authority v Maposa, it was stated as follows:
"An award will not be contrary to public policy merely because the reasoning or conclusions of the arbitrator are wrong in fact or in law.
In such a situation the court would not be justified in setting the award aside.
Under Article 35 or 36, the Court does not exercise an appeal power and either uphold or set aside or decline to recognize and enforce an award by having regard to what it considers should have been the correct decision. Where, however, the reasoning or conclusion in an award goes beyond mere faultiness or incorrectness and constitutes a palpable inequity that is so far reaching and outrageous in its defiance of logic or accepted moral standards that a sensible and fair minded person would consider that the conception of Justice in
Zimbabwe would be contrary to uphold it."
J31
9.19 The Appellant appears to canvass the argument that the Appellant, being a public body, and the Award being so substantial, and not properly arrived at, causes obvious damage and clear injury to the public and has therefore urged us to set aside the Award for being contrary to public policy in line with section 17 of the Arbitration Act 1
•
9.20 We refer to an article published in Kluwer Arbitration Blog6 by Wolters
Kluwer under the heading, 'Public Policy: Is this catch-all provision relevant to the legitimacy of International commercial Arbitration'. It is noted that the concept of public policy is widely invoked: Article V(2)(b) of the New York
Convention3 provides that recognition and enforcement of an award "may also be refused" if "recognition and enforcement of the award would be contrary to public policy". Setting aside provisions in many national arbitration acts also refer to public policy. However, there is no autonomous definition of public policy. Authors, arbitrators and Jurists have often referred to an autonomous international standard. One of the definitions most frequently invoked identifies "the most basic notions of morality and justice" as constituting public policy.
9.21 It is fundamentally accepted that this narrow interpretation of public policy, is necessary to prevent the public policy exception from becoming a channel to review the award on the merits. It is argued that the invocation of public policy should not be used as a mechanism to allow a substantive review of the award, but only a limited review to determine whether the enforcement or the confirmation of the award would seriously infringe fundamental principles. There has to be balance in maintaining the efficacy
J32
and autonomy of arbitration whilst safeguarding fundamental principles of justice.
9.22 From the Originating Summons and its supporting affidavit, the Appellant moved the lower Court under the provisions of section 17 of the Arbitration
Act without specifying the relevant subsection. This in itself is procedurally wrong as section 17 has several subsections and it is critical that an applicant applying to set aside an Award must refer to the correct provision of the law under which it seeks to do so. In its Memorandum of Appeal, the
Appellant has relied on section 17 (2) (a) (iii) and 17 (2) (b) (ii).
The attempt to rely on section 17 (2) (a) (i) under the guise of it being a jurisdictional issue has already been dismissed at paragraph 8 above.
9.23 It would appear from a reading of the averments in the Affidavit, (see paragraphs 8 to 13 thereof), that the Appellant RDA appears to refer specifically to the provisions of section 17 (2) a iii and section 17 (2) b ii. As we have noted, this must not be left for the Court to deduce but clear reference must be made to the specific ground under which the Award is sought to be set aside. The relevant parts of section 17 read as follows:
(2) An arbitral award may be set aside by the court only if
(a) the party making the application furnishes proof that-
(iii) the award deals with a dispute not contemplated by, or not falling within the terms of, the submission to arbitration, or contains decisions on matters beyond the scope of the submission to arbitration, provided that, if the decision on matters submitted to arbitration can be
J33
separated from those not so submitted, only that part of the award which contains decisions on matters not submitted to arbitration may be set aside;
(b) if the court finds that-
(ii) the award is in conflict with public policy;
9.24 Procedurally, the matter does not end here. In moving the Court, the applicant's application must be filed in accordance with The Arbitration
(Court Proceedings) Rules2 and more specifically with Part VIII Rule 23
which provides as follows:
(1) An application, under section seventeen of the Act, to set aside an award shall be made by originating summons to a Judge of the High
Court.
(2) The application referred to in sub-rule (1) shall be supported by an affidavit-
(a) exhibiting the original award or a certified copy thereof;
(b) exhibiting the original arbitration agreement or duly certified copy thereof;
(c) Stating to the best of the knowledge and belief of the deponent, the facts relied upon in support of the application; and
(d) stating the date of receipt of the award by the party applying to set aside the award.
(3) The affidavit shall be accompanied by such other evidence with respect to the matters referred to in subsection (2) of section seventeen of the Act, as may be necessary to support the application.
(4) On an application to set aside an award, the court may direct that an issue between the parties shall be stated and tried and may give such direction in relation to the trial of such issue as may be necessary, or make any other order considered necessary in the circumstances.
9.25 We refer to a recent decision of the full bench of the Supreme Court rendered on 7th August 2024, ironically with the Appellant in casu, also being the Appellant in that Judgment under reference. In the case of Road
Development Agency v Safricas Zambia Limited23 the Apex Court had the
, opportunity to settle the procedural requirements on an application for an order to set aside an arbitral award under section 17 of the Act and in accordance with Rule 23 of the Arbitration (Court Proceeding) Rules. To the extent that the appeal before the Supreme Court was on all fours with the appeal before us, we shall borrow extensively from the said Judgment.
9.26 It is also worth noting that the afore cited case traced its roots from the arbitral process to adjudication across all three superior Courts in the
Country. The matter started off as an application before the High Court to set aside the Award in accordance with the same two provisions noted above and in casu. The decision of the High Court (which set aside the
Award) was challenged by the Appellant Safricas, and by our Judgment rendered on 18th August 2023, we set aside the Judgment of the High Court and upheld the Arbitral Award. This was in the case of Safricas Zambia limited v Road Development Agency 24
•
J35
9.27 The Appellant RDA, in the Safricas decision, appealed our Judgment to the
Supreme Court which had occasion to consider the Judgment of this Court.
In our Judgment, we held that the Appellant (RDA's) application, which was laid before the High Court, did not reveal evidence supporting the contention that the award offended public policy. We found that the application was therefore incompetent because it did not satisfy the requirement of Rule 23 (2) (c) of the Rules (quoted in paragraph 9.24 above).
9.28 In considering the appeal (from this Court), the Supreme Court undertook a detailed analysis of the provisions of subrule 2(c) of Rule 232 The Apex
.
Court noted that the subrule compels a party to file an affidavit in support of the application to set aside the award which should set out evidence in support of the application. In the consideration of the Apex Court, the rationale for this requirement was not only to alert the opposing party, but also the Court to understand the case to which it should align its jurisdiction.
9.29 The Supreme Court also noted that the use of the word 'shall' in the rule, made it a mandatory requirement. In the Safricas case, the Supreme Court noted that the Appellant, in accordance with the rule, (Rule 23) did file an affidavit in support. The Court on page J24, noted as follows:
"However, the affidavit does not, as the Court of Appeal quite rightly held, and as the Respondent argued, reveal the facts upon which the contention of the award offending public policy was based."
J36
9.30 To compare the reasoning of our Court, and as confirmed by the Supreme
Court, we note the averments which are offered as evidence in casu. The affidavit in support at page 44 of the Record of Appeal, only has one paragraph referring to the ground relied upon as follows:
"12. That I verily believe that the contents of the Final Award are contrary to public policy."
9.31 The position we take in casu, as adopted also by the Supreme Court, is that the foregoing paragraph does not satisfy the requirements of rule 23 (2) (c)
of the Rules, as it does not in any way state or explain the facts which support the contention of the Award offending public policy.
9.32 The Supreme Court in the Safricas judgment, at page J26, noted as follows:
"59. 1 The High Court Rules prescribed not only how matters will be presented before that Court, but also the manner in which evidence will be led before it. This is either by way of affidavit or a witness in person, i.e., viva voce. In the case of evidence in support of an application to set aside an award, the prescription, as per rule 23(1 ), is that the evidence shall be presented in an affidavit in support. The rule does not state that such evidence will be contained in the skeleton or heads of argument in support. This, in any event, would be a departure from the Court's tradition because the arguments are not settled by a witness but by counsel.
J37
59.2 Rule 23 (2) (c) of the Rules makes no distinction between evidence arising from legal issues and that which does not arise from legal issues. The Rule merely compels all applicants to state " ... the facts relied upon in support of the application ... " regardless of their source and nature.'
9.33 From the averments in paragraphs 8, 9, and 11, of the supporting affidavit at page 44 (there is no paragraph 10), it is clear that the Appellant remains dissatisfied with the Award. In its application to set aside the Award, it has invited the lower Court to correct what it terms are manifest errors, mistakes and flaws which are contrary to commercial construction and business sense.
9.34 There are abundant authorities that speak to this principle. It is trite that a
Court does not sit as an appellate court to re-write the Award even where there may be mistakes of fact or law. The long and short of it all is that in the general scheme of things, a voluntary arbitral award is not appealable. It is final and binding on the parties, consistent with the doctrine of party autonomy.
9.35 The question we finally ask ourselves is this:
Did the failure to comply with Rule 23{2)(c) in terms of form and content preclude the tower Court from considering the application?
We are of the considered view that in the matter before us, the defect is not in form but rather substance, in that the Appellant failed to lead evidence to support its contentions in the motion before the lower Court. Such defect is not curable.
9.36 Further and to espouse such cavalier disposition, and to rely on a mistaken misapprehension of the law that the use of the words 'public policy' is a general panacea for all applications to challenge an Award is fatal to this application. There has to be a high threshold test in order to trigger a public policy defence. In casu, the Appellant has failed to raise a single solid point that could trigger the public policy provision, let alone reach the high threshold set.
9.37 We must emphasize that although we have considered in great detail the argument on public policy, although it was apparent that the Appellant breached the mandatory requirement to make this application, this is due to the rising number of appeals that we are faced with on the ground of public policy. It goes without saying that the Award has not come to us with a sense of shock or perceived horror, it is not against the principles of good moral conscience or justice, nor is there any manifest injustice that has been occasioned that would add credibility to the argument on public policy. We have no hesitation in dismissing ground 1 of the appeal.
9.38 We move to interrogate ground 2 of the appeal. The Appellant has argued that the trial Judge erred in law and fact when he held that the Tribunal's comments on the manner in which the Appellant approached the arbitration were made obiter dicta. It is the Appellant's understanding that in offering such remarks, the Arbitral Tribunal went beyond the scope of the matters submitted for arbitration by alleging and delving into unfounded allegations and delving into unfounded allegations relating to in-house counsel and his ability to deal with the Arbitration. The Appellant has contended that such considerations and remarks influenced the eventual
J39
outcome of the Award. Again, we note that the Appellant appears to have misapprehended the limited circumstances in which a Party may apply to set aside an Award in accordance with section 17 of the Act.
9.39 We have scrutinized the Record of Appeal and indeed the supporting affidavit, which has already been extensively canvassed, and note that there is no evidence or argument that lends itself to the limited scope of setting aside as envisaged by section 17 2 (iii) of the Act. The deponent in paragraph 13 of the supporting affidavit avers as follows:
"13. That I am further advised by my advocates on record that the arbitral tribunal dealt with issues that went beyond the scope of the matters submitted for arbitration by alleging and delving into unfounded a/legations bordering on the conduct and expertise of the
Applicant's in-house Counsel and independent lawyers engaged by the Respondent, which influenced the arbitral tribunal's Award as seen by the exhibits produced herein and marked "CYK-5" which reveal the manner in which the Witness Statements referred to by the
Tribunal were drafted and filed the before the Tribunal'.
9.40 It is our considered view that the Appellant appears to have limited, or no understanding of the Arbitral process, the Act or indeed the stringent requirements in an appli'cation to set aside. Instead of the Appellant showing or leading evidence of how and where the Arbitral Tribunal exceeded the scope of its jurisdiction in terms of the claims placed before it, the Appellant seeks to make mileage from remarks offered by the Tribunal in its closing comments. It is clear from a cursory glance at the Award,
J40
•
(although we are very settled that we are not sitting in a supervisory capacity to correct the Award), that the remarks were made almost post-script, and after the Tribunal had rendered a reasoned Award on all the claims before it. The remarks made by the Tribunal are simply a reflection of the competence of Counsel before it.
9.41 We are in fact appalled by the belligerent attitude of counsel in the arbitral proceedings, who, for example, when called upon to submit a properly paginated and referenced bundle of documents on which RDA would support its defence, argued with the Arbitral Tribunal and insisted that he was acting on instruction, to defy what is a logical request and order. We note the following unfortunate exchange between the Tribunal and Counsel at page 359 of volume 2:
"Court: (ought to read Tribunal Chair), I understand okay you got your instructions. But you have to level with us as well. We have to arbitrate according to the rules of natural justice and it must be fair and I must be frank with you upfront. Your bundle will not be allowed into the arbitral process until we have got a paginated bundle. So there will be no reference to any of the bundles referred to by the Respondent unless we are given a paginated bundle.
Mr. Malambo: Then that's a ground for public policy offence, it might offend the public policy.'
9.42 The Tribunal in its concluding remarks in the Award, noted as follows:
J41
'106. The need for expert assistance (for a proper assessment of the quantum of the claims), should not have escaped the attention of a legal practitioner, even with limited experience in this field. However,
(and despite an enquiry made by the tribunal whether the respondent intended to rely on expert evidence), the respondent inexplicably and irresponsibly decided to bat on without assistance.
107. The respondent's legal department is largely to be blamed for the ill-equipped presentation of its defence, especially in failing to appoint attorneys specializing in the field of construction-claims.
108. In the result, the tribunal received scant or no support from the respondent to assist in considering and determining the disputes and quantum issues between the parties.
109. We would be remiss in our duty, should we fail to point out that the presentation of the defences in this matter was below standard and contributed significantly to the substantial award made. It cannot be ruled out that the employment of an expert might have assisted the respondent in reducing the quantum of the claims. However, it is no longer feasible to assess the notional impact expert assistance might have had in reducing the quantum awarded to the claimant. For this, the employees of the respondent are responsible."
9.43 Such observations, whether made by an arbitral tribunal or indeed a Court, are comments made obiter and are commonplace at the end of proceedings and are only a reflection of the quality of the claim or defence,
J42
as the case may be, and can never be seen as grounds on which to found a challenge to set aside the Award.
9.44 The appellant also appears to argue the position that the Court has the jurisdiction to set aside an Award and replace it with what it terms a just
Award. In support of this albeit mistaken principle, that the Award was so manifestly excessive and hence against public policy, it has called in aid the decision of the Supreme Court in the cited case of Savenda Management
Services Limited v Stanbic Bank Zambia Limited.
9.45 Although we have noted that the Appellant did not strictly rely on section 17
(2) (a) (iii) of the Act, having based its grounds on public policy, it is noted that there is loose reference to the Arbitral Tribunal having exceeded its authority on ground of comments attributed to it in its reasoning process.
Although we have addressed this argument above, we wish to settle the position that Arbitration is a dispute resolution process which is party driven and obtains its mandate from the parties. We cannot fault the decision of the lower Court whch was of the settled view that the Award was reasoned and dealt with the dispute under reference.
9.46 The Supreme Court was categoric on the powers of a Court to set aside a
Judgment of the Lower Court, as it did in the cited case of Savenda v
Stanbic Bank. A Court does not automatically enjoy the same jurisdiction in respect of a decision of an Arbitral Tribunal. In the words of the Supreme
Court:
"We do not enjoy the same liberty in relation to an arbitrator's award because our power is restricted to reviewing the due process or road
J43
map leading up to the award and not the merits. To this extent, the
Savenda case is distinguishable from this case."
9.47 In its recent Ruling delivered by the Supreme Court of Zambia in the case of
ZCCM Investments Holdings Pie v Vedanta Resources Holding Limited and Konkola Copper Mines Plc25, the Apex Court made serious pronouncements and issued guidance which ought to be heeded by litigants and practitioners alike. The Court guided, and in our opinion, this guidance applies as much to the substantive grounds of appeal in casu, as well as the ill-fated ''iurisdictional issue", that it is not the remit of the
Courts to attempt to make a determination on issues that were a subject of determination by the arbitral tribunal.
9.48 Jurisprudence from the Region, and notable arbitration friendly jurisdictions are all consistent to upholding party autonomy and the limited role of the national Courts. In the case of Light Weight Body Armour v Sri Lanka
Army26, the Supreme Court of Sri Lanka held inter alia as follows:
''. ... the Court cannot sit in appeal over the conclusions of the Arbitral
Tribunal by scrutinizing and reappreciating the evidence considered by the Arbitral tribunal. The Court cannot re-examine the mental process of the Arbitration Tribunal contemplated in its findings nor can it revisit the reasonableness of the deductions given by the arbitrator-since the arbitral tribunal is the sole judge of the quantity and quality of the mass of evidence led before it by the parties- the only issue that needs consideration is whether the purported
J44
fundamental flaws of the award in question would tantamount to a violation of public policy".
9.49 In a recent decision rendered on 26th November 2024, in the case of
Clovegate Elevator Company Limited v Justice Mtshiya and Zimbabwe
Power Company (Private) Limited27 the Supreme Court of Zimbabwe,
, cautioned litigants not to confuse an arbitral award with a Court judgment.
The Court noted as follows:
"Although they both settle legal disputes, they are diametrically and materially different. The major difference is that there is greater judicial discretion when enforcing a judgment than when dealing with an arbitral award. Judicial intervention is severely limited by statute when dealing with arbitral awards."
9.50 At paragraph 32 of the said Judgment, the Court noted as follows:
"A misapprehension of the distinction between a Judgment and an arbitral award often leads legal practitioners and judicial officers to misapply legal principles for upsetting a judgment to an arbitral award. This is untenable because a good number of the basis upon which a judgment may be upset by a higher court either on appeal or review are inapplicable to arbitral awards."
9.51 We therefore uphold the Judgment of the lower Court in its reasoning. It was correct in determining that the arbitral tribunal dealt with all the issues raised before it and it was also correct in determining that the Award did not offend the public policy of the country.
J45
...
ti
10.5 We dismiss this appeal with costs to the Respondent to be taxed in default of agreement.
M. J. SIAVWAPA
JUDGE PRESIDENT
F.M CHISHIMBA A.N. PATEL S.C.
COURT OF APPEAL JUDGE COURT OF APPEAL JUDGE
J47
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