Aircraft Support Industries Pty Ltd v William Hare UAE LLC

Aircraft Support Industries Pty Ltd (the applicant) sought to enforce an international commercial arbitral award made in Dubai against William Hare UAE LLC (the respondent) in the Supreme Court of New South Wales. The applicant sought to enforce the award pursuant to section 8 of the *International Arbitration Act 1974* (Cth). The respondent resisted enforcement, arguing that the award should not be enforced on the grounds that it breached the rules of natural justice, and that the offending parts of the award were not capable of severance from the remainder.

The primary legal issues before the Court of Appeal were whether the arbitral tribunal had breached the rules of natural justice in its conduct of the arbitration, and if so, whether the parts of the award affected by this breach could be severed from the rest of the award, allowing for partial enforcement. The respondent contended that the tribunal’s failure to provide it with an opportunity to present its case on a particular issue constituted a breach of natural justice, and that this breach was so fundamental that no part of the award could be enforced.

The Court of Appeal affirmed the decision of the primary judge, finding that while there had been a breach of natural justice, it was confined to a specific aspect of the award. The Court applied the principles of severance, holding that where a breach of natural justice affects only a discrete part of an award, and the remainder of the award is otherwise valid and enforceable, the court has the power to enforce the severable, valid part. The Court concluded that the breach in this instance did not permeate the entire award, and that the substantial majority of the award remained unaffected and capable of enforcement.

Consequently, the appeal was dismissed, and the appellant was ordered to pay the respondent’s costs of the appeal.