Eastern Metropolitan Regional Council v Four Seasons Construction Pty Ltd
[1999] WASC 167
EASTERN METROPOLITAN REGIONAL COUNCIL -v- FOUR SEASONS CONSTRUCTION PTY LTD [1999] WASC 167
| SUPREME COURT OF WESTERN AUSTRALIA | Citation No: | [1999] WASC 167 | |
| Case No: | ARB:8/1999 | 9 SEPTEMBER 1999 | |
| Coram: | MASTER SANDERSON | 9/09/99 | |
| 6 | Judgment Part: | 1 of 1 | |
| Result: | Application adjourned | ||
| PDF Version |
| Parties: | EASTERN METROPOLITAN REGIONAL COUNCIL FOUR SEASONS CONSTRUCTION PTY LTD |
Catchwords: | Turns on its own facts |
Legislation: | Commercial Arbitration Act 1985, s 14 and s 47 |
Case References: | Haddad v Norman Mix Pty Ltd [1967] 2 NSWR 676 South Australian Superannuation Fund Investment Trust v Leighton Contractors Pty Ltd (1990) 55 SASR 327 Nil |
JURISDICTION : SUPREME COURT OF WESTERN AUSTRALIA
- IN CHAMBERS
- Applicant
AND
FOUR SEASONS CONSTRUCTION PTY LTD
Respondent
Catchwords:
Turns on its own facts
Legislation:
Commercial Arbitration Act 1985, s 14 and s 47
Result:
Application adjourned
(Page 2)
Representation:
Counsel:
Applicant : Mr H R Robinson
Respondent : Mr S H Baird
Solicitors:
Applicant : Haydn Robinson
Respondent : Summers Partners
Case(s) referred to in judgment(s):
Haddad v Norman Mix Pty Ltd [1967] 2 NSWR 676
South Australian Superannuation Fund Investment Trust v Leighton Contractors Pty Ltd (1990) 55 SASR 327
Case(s) also cited:
Nil
(Page 3)
1 MASTER SANDERSON: Let me first deal with the question of whether or not I ought make orders in relation to what might be termed interlocutory aspects of this arbitration or, indeed, whether I should stay the arbitration pending delivery of points of claim in a form which would closely approximate a statement of claim were proceedings conducted in this Court.
2 The powers of the arbitrator and the court are set out in the Commercial Arbitration Act 1985. The starting point is s 14 of the Act which is in the following terms:
"Subject to this Act and to the arbitration agreement, the arbitrator or umpire may conduct proceedings under that agreement in such manner as the arbitrator or umpire thinks fit."
3 It is apparent from that section that the scope given to an arbitrator in particular arbitration is wide indeed. But I think that the authorities indicate an arbitrator needs to be very cautious about departing from what might be seen as the standard judicial process of conducting an arbitration lest he leave himself open to a charge of misconduct: see Haddad v Norman Mix Pty Ltd [1967] 2 NSWR 676. Section 47 of the Act is in the following terms:
"The Court shall have the same power of making interlocutory orders for the purposes and in relation to arbitration proceedings as it has for the purposes of and in relation to proceedings in Court."
4 That section has a marginal note in the following terms, "The general power of the Court to make interlocutory orders."
5 It would seem to me that the natural reading of that section indicates that the court can in certain circumstances, if it believes it is necessary for the proper conduct of the arbitration, make interlocutory orders which will govern the way that the pre-arbitration matters are conducted.
6 For instance, it would be open to the court to order that the matter proceed by what amounted to pleadings or perhaps points of claim and it would be open to the Court to order that each party provide discovery if for one reason or another such an order was not made by the arbitrator.
7 I think two things arise out of s 47. First, it must be read in conjunction with s 14 so that it is not the function of the court to simply take over the conduct of the interlocutory proceedings of the arbitration
(Page 4)
- and ignore the way in which the arbitrator intends to approach the reference. Rather, it seems to me, that the power is a supervisory power which should be exercised only so far as it is necessary to ensure that the arbitration proceeds in a proper manner.
8 That view accords with the decision of the Full Court of the Supreme Court of South Australia in South Australian Superannuation Fund Investment Trust v Leighton Contractors Pty Ltd (1990) 55 SASR 327. I appreciate that there is some doubt as to the extent of the Court's powers under s 47 and that in various jurisdictions different views have been taken. These are all discussed in Jacobs, "Commercial Arbitration" at 47.260.
9 Without going through the authorities, it is clear that there is a broad supervisory power in the Court which should be exercised if it becomes apparent that the arbitration is proceeding in a way which is likely to give rise to an application to set aside an award.
10 Secondly, given the obvious tension between s 14 and s 47, the Court should only act in a clear case. It is not appropriate for the Court to simply supplant the Arbitrator. The Arbitrator ought therefore be given as much scope as possible.
11 In this case the arbitration has had something of a chequered history. The present applicant applied to stay the arbitration and issued proceedings in this Court with a view to obtaining such an order. That application failed both at first instance and on appeal. The decision of the Court was that the arbitration should proceed and, in fact, the Supreme Court action should be stayed.
12 This has led to delay in the conduct of the arbitration and it would appear that such delay is causing the arbitrator some concern. It need not do so. The present applicant has done nothing more than exercise what is its rights at law. There has been correspondence between the parties and the arbitrator in relation to the interlocutory matters prior to the arbitration. This correspondence has culminated in a letter of 30 August 1999 which appears as Annexure HRR9 to the affidavit of Hadyn Ross Robertson sworn 3 September 1999.
13 This letter is an attempt by the arbitrator, as I understand it, to set out a timetable leading to the resolution of the dispute between the parties. In other words, the letter deals with presently outstanding interlocutory matters which must be disposed of prior to the arbitration taking place.
(Page 5)
14 It would appear that the letter was generated without reference to the parties and the letter itself does not make it entirely clear how the arbitrator intends to approach the arbitration. For instance, it is not entirely clear whether the arbitrator intends to deal with the arbitration simply on the papers or whether it is his intention to have a hearing at which the deponents to affidavits will be cross-examined.
15 It is also not entirely clear just what issues are before the arbitrator and how those issues are defined, whether by points of claim or otherwise. I must say that I have grave concerns as to the way that this arbitration is progressing. The point has been repeatedly made by counsel for the present applicant, and properly made I might say, that the prime question in this case is whether or not the contract between the applicant and the respondent has been terminated and, if so, properly terminated.
16 As I think the decision of the Full Court makes clear, this is a matter which in the normal course would be considered by a court and it may be that a court would be a more appropriate forum to consider such a discrete question of law. But for reasons which the Full Court has articulated, the parties have determined that they will go to arbitration and that is the way the matter must be resolved.
17 Having said that, it does, I think, behove the arbitrator to proceed in a manner which acknowledges that one of the prime points between the parties is a question of law which should be determined and should be approached in the same way as a court would approach such a question.
18 In saying that, I am not in any way attempting to fetter the discretion of the arbitrator as to the way in which he conducts the arbitration. But I would make the point that there is a primary question of law which ought to be approached in a particular way. That being so, I have doubts as to the way in which the arbitration is presently proceeding and I have doubts about the interlocutory process which has taken place to date and which is contemplated by the arbitrator's letter of 30 August 1999.
19 Nonetheless, I take the view that the better approach is for the present applicant if it is concerned about the conduct of the arbitration, to approach the arbitrator, express the concerns directly to the arbitrator, put before the arbitrator a series of directions it says will lead to the expeditious and proper determination of the issue between the parties and obtain from the arbitrator a ruling as to the way in which he intends to approach the outstanding interlocutory matters.
(Page 6)
20 I appreciate that the time-frame imposed by the arbitrator in his letter of 30 August is tight. Nonetheless, I am of the view that the proper approach to give the arbitrator the opportunity to adjust any interlocutory process in such a way as to accommodate the concerns of the applicant. Depending upon the outcome of such a further preliminary hearing, it may be appropriate for this Court to make orders of a supervisory nature for the proper conduct of the arbitration. But to do so without giving the arbitrator the opportunity to listen to what the present applicant has to say and to make orders accordingly would, in my view, be to substitute the Court for the arbitrator.
21 On that basis, what I propose to do is adjourn the application for an order for points of claim for a period, perhaps 7 days, during which time the applicant may, if it wishes, approach the arbitrator and the arbitrator will no doubt respond to that approach. Depending on the outcome of that interaction, the matter can then be further considered.
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