Lieschke v Lieschke

The applicants, Lieschke and Lieschke, appealed to the Court of Appeal of New South Wales against a primary judge's decision to set aside an arbitral award. The dispute arose from the dissolution of a family farming partnership. The respondent, also Lieschke, had filed an amended statement under section 23(1) of the *Commercial Arbitration Act 2010* (NSW) seeking a determination that certain properties were partnership assets and variations to the partnership accounts. The parties had otherwise proceeded on the assumption that the partnership accounts were correct, and an interim award had already rejected the respondent's claim regarding the properties.

The central legal issues before the Court of Appeal were whether the primary judge erred in setting aside the arbitral award on the grounds that the respondent was unable to present his case and that the award was contrary to public policy, pursuant to sections 34(2)(a)(ii) and 34(2)(b)(ii) of the *Commercial Arbitration Act 2010* (NSW). Specifically, the court considered whether the arbitrator's order precluding the respondent's new accountant from conferring with the existing accountants constituted a denial of the respondent's right to present his case, and whether the respondent's attempt to introduce a new accounting approach constituted an "available case" that he was denied the opportunity to present.

The Court of Appeal reasoned that the entitlement to a reasonable opportunity to present a case does not extend to introducing a new case that was not adverted to in the initial statement or sought to be amended under section 23(3) of the Act. The amended points of claim and submissions had clearly identified the parties' respective cases and the issues in dispute. The court held that the respondent's inability to present his new accounting approach was a consequence of his own strategic choices, including his decision to retain new legal and accounting advisors late in the proceedings and his failure to seek formal amendment of his statement of claim. The arbitrator's order was therefore not a denial of the respondent's right to present his case, nor was the final award contrary to public policy.

Consequently, the Court of Appeal allowed the appeal, set aside the primary judge's orders, and dismissed the proceedings seeking to set aside the arbitral award. The respondent was ordered to pay the applicants' costs of both the proceedings at first instance and the appeal.