FA Industry Pty Ltd v Frigrite Mechanical Services Pty Ltd

FA Industry Pty Ltd (the applicant) sought to set aside an arbitration award made in favour of Frigrite Mechanical Services Pty Ltd (the respondent). The dispute concerned a contract for the supply and installation of a refrigeration system. The applicant alleged that the arbitration award was invalid due to a breach of natural justice, specifically that it was denied a fair hearing.

The primary legal issue before the court was whether the arbitrator had breached the rules of natural justice by failing to give the applicant a proper opportunity to present its case. This involved considering whether the arbitrator's conduct, in limiting the scope of evidence and submissions, amounted to a denial of procedural fairness.

The court found that the arbitrator had indeed breached the rules of natural justice. The arbitrator's decision to restrict the applicant's ability to present evidence and make submissions on key aspects of its defence, particularly concerning the alleged defects in the refrigeration system, prevented the applicant from having a fair hearing. The court applied the principle that a party to arbitration is entitled to a reasonable opportunity to present its case, and that this right was not afforded to the applicant.

Consequently, the court made orders setting aside the arbitration award.