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SUBJECT MATTER OF ARBITRATION MUST BE WITHIN THE ORIGINAL CONTRACT

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In BAKER MARINE (NIG) v. CHEVRON NIG. LTD (2006) 6 SC 21 at Pg. 31 &37; (2006) FWLR Pt. 326 Pg. 235 at 250, the issue in this Court was whether damages for the tort of conspiracy as opposed to that of breach of contract can be at large and that aggravated damages could be claimed and sustained by the arbitral award. This Court held that any award would be outside the arbitration agreement and the arbitrators are not allowed to re-write the arbitration agreement to include extraneous issues or parties outside the substantive contract between the parties.

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arbitration

GENERAL PRINCIPLES APPLICABLE IN REGULAR COURTS ARE NOT APPLICABLE IN ARBITRATION PROCEEDINGS

In this context, the general principles of law laid down and applicable to and in proceedings of the regular Courts in the process of judicial adjudication of causes or matters before them do not ordinarily apply to such quasi judicial arbitral proceedings which the parties by their free and voluntary choice, opted to resort to in the settlement of their disputes rather than the judicial/adjudication of the regular Courts.

– Garba, JCA. Dunlop v. Gaslink (2018)

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IMPORTANCE OF COURT IN RESOLVING DISPUTES AS AGAINST ARBITRATION

589. The privacy of arbitration meant that there was no public or press scrutiny of what was going on and what was not being done. When courts are concerned it is often said that the “open court principle” helps keep judges up to the mark. But it also allows scrutiny of the process as a whole, and what the lawyers and other professionals are doing, and (where a state is involved) what the state is doing to address a dispute on behalf of its people. An open process allows the chance for the public and press to call out what is not right.
591. And Lord Wolfson KC will forgive my quoting his submission for his client in oral closing argument: “Section 68 is not there to give you a remedy if you instruct an honest lawyer who makes a mess of it or doesn’t take an available point. That is just tough. You have made your arbitration bed and you lie on it”. Blunt and correct. But, unless accompanied by public visibility or greater scrutiny by arbitrators, how suitable is the process in a case such as this where what is at stake is public money amounting to a material percentage of a state’s GDP or budget? Is greater visibility in arbitrations involving a state or state owned entities part of the answer?
— R. Knowles CBE. FRN v. Process & Industrial Developments Limited [2023] EWHC 2638 (Comm)

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FROM THE FACTS AND CIRCUMSTANCES OF THIS CASE IT SHOWS THAT ARBITRATION MAY BE MORE OPEN TO FRAUD

582. Regardless of my decision, I hope the facts and circumstances of this case may provoke debate and reflection among the arbitration community, and also among state users of arbitration, and among other courts with responsibility to supervise or oversee arbitration. The facts and circumstances of this case, which are remarkable but very real, provide an opportunity to consider whether the arbitration process, which is of outstanding importance and value in the world, needs further attention where the value involved is so large and where a state is involved. 583. The risk is that arbitration as a process becomes less reliable, less able to find difficult but important new legal ground, and more vulnerable to fraud. The present case shows that having (as here) a tribunal of the greatest experience and expertise is not enough. Without reflection, then a case such as the present could happen again, and not reach the court.

— R. Knowles CBE. FRN v. Process & Industrial Developments Limited [2023] EWHC 2638 (Comm)

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PARTY CANNOT RESILE AFTER SUBMISSION TO CUSTOMARY ARBITRATION

On these facts of the customary arbitration by the Abuloma Council of Chiefs before whom the parties herein lead consensually submitted themselves to for the resolution of their dispute and the verdict of which arbitration was acceptable to all of them, it would no longer be open to either of the parties to subsequently back out or resile from the decision or verdict reached and pronounced upon the arbitration. See Oparaji v. Ohanu (1999) 9 NWLR (Pt. 618) 290, (2001) FWLR (Pt. 43) 385. The appellants are now estopped from resiling out of the customary arbitration of the Abuloma Council of Chiefs, which they voluntarily submitted their dispute with the respondents to, and agreed to accept the verdict of. Apart from this specie of estoppel operating as estoppel per rem judicatam; it also operates as estoppel by conduct by virtue of section 150 of the Evidence Act, 1990 (now section 169 of the Evidence Act, 2011). It is, therefore, unconscionable for the appellants, having by their words or conduct made the respondents to believe that they would be bound by the verdict of the Abuloma Council of Chiefs, to resile out of it and set up the suit, the subject of this appeal. See Joe Iga & Ors. v. Ezekiel Amakiri & Ors. (1976) 11 SC 1 at pages 12 – 13.

— Eko JSC. Benjamin v Kalio (2017) – SC/207/2006

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ARBITRAL AWARDS HAVE SAME FORCE AS A JUDGEMENT OF A COURT

Onwu v. Nka (1996) 7 NWLR (Pt.458) 1 at 17 paragraph E, where the Supreme Court, per Iguh JSC. had this to say: “The law is well settled that where disputes or matters in difference between two or more parties are by consent of the disputants submitted to a domestic forum inclusive of arbitrators or a body of persons who may be invested with judicial authority to hear and determine such disputes and matters for investigation in accordance with customary law and general usages, and a decision is duly given, it is as conclusive and unimpeachable (unless and until set aside on any of the recognized grounds) as the decision of any constituted court of the land, such a decision is consequently binding on the parties and the courts in appropriate cases will enforce it.”

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PARTIES ARE BOUND BY ARBITRAL AWARD

Once parties have consented to arbitration, they have also consented to accept the final award by the arbitrator.

– Nimpar, JCA. Dunlop v. Gaslink (2018)

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