Falgat Constructions Pty Limited v Lightning Readymixed Concrete Pty Ltd

Falgat Constructions Pty Limited (Falgat) sought to set aside an arbitration award made in favour of Lightning Readymixed Concrete Pty Ltd (Lightning). The dispute concerned the supply of concrete by Lightning to Falgat for a construction project. Falgat alleged that the concrete supplied was defective, leading to delays and increased costs. Lightning initiated arbitration proceedings to recover payment for the concrete supplied. The arbitrator found in favour of Lightning, awarding it the full amount claimed. Falgat then applied to the Supreme Court of New South Wales to have this award set aside.

The primary legal issue before the Court was whether the arbitrator had exceeded his jurisdiction by failing to afford Falgat natural justice. Specifically, Falgat contended that the arbitrator had improperly refused to grant an adjournment of the arbitration hearing, which Falgat argued was necessary to allow it to obtain and present expert evidence regarding the alleged defects in the concrete. Falgat submitted that this refusal amounted to a denial of procedural fairness, a ground for setting aside an arbitral award under the relevant legislation.

The Court considered the principles governing the conduct of arbitration proceedings and the limited grounds for judicial intervention. It was held that an arbitrator has a broad discretion in managing the conduct of an arbitration, including the decision to grant or refuse an adjournment. This discretion must be exercised judicially, taking into account all relevant circumstances, including the need for expedition and the potential prejudice to the parties. In this instance, the Court found that the arbitrator had considered Falgat's request for an adjournment and had a rational basis for refusing it, having regard to the history of the proceedings and the steps already taken. The Court concluded that the refusal did not amount to a denial of natural justice or a want of jurisdiction.

Consequently, the application to set aside the arbitration award was dismissed.