Contract - Termination of
contract - Non-performance or
delayed performance - Valuation
of work done - Leave to enter
final judgment - Order 64, Rule
13 - High Court (Civil
Procedure) Rules 2004, (CI 47) -
Dispute resolution provisions -
Payment for work done together
with interest – Whether or not
the decision DAB process was an
arbitration and its decision an
arbitral award - Whether or not
the decision of the DAB is
“final and binding” between the
parties - Whether the Court of
Appeal erred in affirming the
decision of the trial High Court
to refer the dispute between the
parties to international
arbitration – Whether there has
been no arbitration and
therefore no arbitral award
capable of adoption -
HEADNOTES
The Defendant owed the Plaintiff
for work done which was to be
paid in tranches after each
phase of work done and the
submission of an invoice.
Defendant received the invoices
for phases of work done but
refused to pay Plaintiff. The
defendant then terminated the
contract with the plaintiff.
The Plaintiff commenced an
action in the High Court by a
writ of summons that claimed
among other reliefs “a
declaration that the purported
termination of the contract
by the Defendant/Respondent
herein on the grounds of
non-performance or delayed
performance was false
procedurally wrong and unjust”
and further claimed for payment
for work done together with
interest. Upon an application by
the Plaintiff for interlocutory
injunction or in the alternative
for a
valuation of work done at
the construction site, the Court
declined to grant the
interlocutory injunction but
granted an order for both
parties to send their team of
quantity surveyors to value the
extent of work done before the
Plaintiff handed over the
construction site to the
Defendant. This report was
consensual and was filed and
presented to the High Court. The
Defendant was then allowed to
take over the construction site
and they appointed a new
contractor. The Defendant
refused to accept to pay the
amount agreed upon by the team
of quantity surveyors and filed
an application before the Court
to activate the dispute
settlement provisions of the
contract. This application was
granted and the court referred
the matter to a Dispute
Adjudication Board (hereinafter
referred to as DAB). The
Institution of Surveyors was
nominated by the agreement of
both parties. The DAB submitted
its decision to the Court
recommending the same amount as
the joint team of quantity
surveyors appointed by the
parties for the amount of work
done. Aggrieved by the decision
of DAB, the Defendant gave a
notice of dissatisfaction to the
Plaintiff. Plaintiff then filed
a motion for leave to sign final
judgment on the DAB decision
under Order 64 of the
High
Court (Civil Procedure) Rules
2004, (CI 47). The trial
High Court Judge refused to
grant the said application to
sign final judgment and referred
the matter to international
arbitration in accordance with
the FIDIC Rules. Dissatisfied
with the ruling of the trial
High Court, plaintiff appealed
to the Court of Appeal which
dismissed the appeal. It is
against this decision that the
plaintiff has appealed to this
court on the following grounds
as contained in the Notice of
Appeal.
HELD
Having carefully considered the
arguments of the parties, the
FIDIC Rules and the law on
contractual dispute resolution
provisions, it is our considered
opinion that the parties agreed
to be governed by a dispute
resolution process provided for
under the FIDIC Rules and are
bound by it. Under these Rules,
the DAB process is an
intermediate expert adjudication
stage. The decision of the DAB
only becomes “final and binding”
if neither party gives a notice
of dissatisfaction within 21
days. Once a party gives a
notice of dissatisfaction within
the stipulated period, the DAB
decision is not “final and
binding.” We therefore affirm
the decision of the High Court
and the Court of Appeal that the
decision of the DAB was not
final and binding and not
capable of adoption as a final
judgement of the Court under
Order 64 of C.I. 47.
We have carefully considered the
facts of this case, the
submissions of the parties and
the FIDIC rules and find the
position of the Plaintiff
untenable. The parties
contracted to be governed by the
FIDIC Rules. These Rules provide
for a dispute resolution
process. The Plaintiff’s
contention that the dispute
between the parties has ended is
not borne out by the facts. The
Defendant did not accept the
valuation of the quantity
surveyors and gave a notice of
dissatisfaction after the DAB
decision. We therefore affirm
the decision of the High Court
and the Court of appeal to refer
the dispute between the parties
to international arbitration
under the FIDIC Rules. In the
circumstances, this appeal fails
in its entirety and is
accordingly dismissed.
STATUTES REFERRED TO IN JUDGMENT
High Court Civil Procedure rules
C.I. 47.
Arbitration Act,1961(Act 38).
CASES REFERRED TO IN JUDGMENT
KLIMATECHNIK ENGINEERING v.
SKANSKA JENSEN INTERNATIONAL
[2005-2006] SCGLR 913
Klimatechnik Engineering Ltd v
Skanska Jensen International
[2005-2006] SCGLR 913
Akwass Farms Ltd. v. Ghana
Telecom Co Ltd. (C.A.,
unreported, Suit No. HI/30/2010,
dated 9th December 2010).
BCM Ghana Ltd v. Ashanti
Goldfields Ltd
[2005-2008] SCGLR 602
BOOKS REFERRED TO IN JUDGMENT
DELIVERING THE LEADING JUDGMENT
KOTEY, JSC:-
COUNSEL
ANKAMAH MENSAH FOR THE
PLAINTIFF/APPELLANT/APPELLANT.
YAW ESHUN WITH AMERLEY ADJOTEYE
FOR THE DEFENDANT/
RESPONDENT/RESPONDENT.
KOTEY, JSC:-
Before us is an appeal from the
judgment of the Court of Appeal
affirming a decision on the
trial High Court dismissing an
application by the Plaintiff/
Appellant/Appellant (hereinafter
Plaintiff) for
leave to
enter final judgment under Order
64, Rule 13 of C.I. 47.
The Plaintiff was a
subcontractor of the
Defendant/Respondent/Respondent
(hereinafter Defendant) for the
construction of a 160-bed
regional hospital at Wa in the
Upper West region. Their
contract was governed by
“Federation Internationale Des
Ingenieurs-Conseils”,
International Federation of
Consulting Engineers Rules
(hereinafter referred to as
FIDIC Rules) which contain
dispute resolution provisions.
For ease of reference we
reproduce the
dispute
resolution provisions of the
FIDIC Rules.
“20.1 Contractor’s Claim
If the Contractor considers
himself to be entitled to any
extension of the Time for
Completion and/or any additional
payment, under any Clause of
these Conditions or otherwise in
connection with the
Contract,
the Contractor shall give notice
to the Employer, describing the
event or circumstance giving
rise to the claim. The notice
shall be given as soon as
practicable, and not later than
28 days after the Contractor
became aware, or should have
become aware, of the event or
circumstance.
20.2 Appointment of the Dispute
Adjudication Board
In cases of disagreements
between the parties: They shall
attempt to resolve their
disagreement through friendly,
direct dialogue and
negotiations. Failure to do that
at the end of 30 days from the
date when the disagreement
arose, either party shall give
notice to each other of its wish
to resort to a DAB and
disagreement shall formally
become dispute. Disputes shall
be adjudicated by a DAB in
accordance with Sub-Clause 20.4
[Obtaining Dispute Adjudication
Board’s Decision]. The parties
shall jointly appoint a DAB by
the date 28 days after a Party
gives notice to the other Party
of its intention to refer a
dispute to a DAB in accordance
with Sub-Clause 20.4.
The DAB shall comprise, as
stated in the Particular
Conditions, either one or three
suitably qualified persons (“the
members”) If the number is not
so stated and the Parties do not
agree otherwise, the DAB shall
comprise three persons…
20.4 Obtaining Dispute
Adjudication Board’s Decision
If a dispute (of any kind
whatsoever) arises between the
Parties in connection with, or
arising out of, the Contract or
the execution of the Works,
including any dispute as to any
certificate, determination, or
instruction, opinion of
valuation of the Employer, then
after a DAB has been appointed
pursuant to Sub-Clause 20.2
[Appointment of the Dispute
Adjudication Board], and 20.3
[Failure to Agree Dispute
Adjudication Board], either
party may refer the dispute in
writing to the DAB for its
decision, with a copy to the
other party. Such reference
shall state that it is given
under this Sub-Clause.
For a DAB of three person, the
DAB shall be deemed to have
received such reference on the
date when it is received by the
chairman of the DAB.
Both Parties shall promptly make
available to the DAB all
information, access to the Site,
and appropriate facilities, as
the DAB may require for the
purposes of making a decision on
such dispute. The DAB shall be
deemed to be not acting as
arbitrators. If either party is
dissatisfied with the DAB’s
decision, then either party may,
within 21 days after receiving
the decision, give notice to the
other Party of its
dissatisfaction. If the DAB
fails to give its decision
within the period of 42 days (or
as otherwise approved) after
receiving such reference or such
payment, then either Party may,
within 14 days after this period
has expired, give notice to the
other Party of its
dissatisfaction.
In either event, this notice of
dissatisfaction shall state that
it is given under this
Sub-Clause, and shall set out
the matter in dispute and the
reason(s) for dissatisfaction.
Except as stated in Sub-Clause
20.7 [Failure to Comply with
Dispute Adjudication Board’s
Decision] and Sub-Clause 20.8
[Expiry of Dispute Adjudication
Board’s Appointment], neither
Party shall be entitled to
commence arbitration of a
dispute unless a notice of
dissatisfaction has been given
in accordance with this
Sub-Clause.
If the DAB has given its
decision as to a matter in
dispute to both Parties, and no
notice of dissatisfaction has
been given by either Party
within 21 days after it received
the DAB’s decision, then the
decision shall become final and
binding on both Parties.
20.5 Amicable Settlement
Where notice of dissatisfaction
has been given under Sub-Clause
20.4 above, both Parties shall
attempt to settle the dispute
amicably before the commencement
of arbitration. However, unless
both Parties agreed otherwise,
arbitration may be commenced on
or after the 30th day on which
notice of dissatisfaction was
given, even if no attempt at
amicable settlement has been
made.
20.6 Arbitration
Unless settled amicably, any
dispute in respect of which the
DAB’s decision (if any) has not
become final and binding shall
be finally settled with
international arbitration unless
otherwise agreed by both
Parties.
a) The dispute shall be
finally settled under the Rules
of Arbitration of the
International Chamber of
Commerce,
b) The dispute shall be
settled by three arbitrators
appointed in accordance with
these Rules, and
c) The arbitration shall
be conducted in the language for
communications defined in
Sub-Clause 1.4 [Law and
language].
The arbitrator(s) shall have
full power to open up, review
and revise any certificate,
determination, instruction,
opinion, or valuation of (or on
behalf of) the Employer, and any
decision of the DAB, relevant to
the dispute.
Neither party shall be limited
in the proceedings before the
arbitrator(s) to the evidence
arguments previously put before
the DAB to obtain its decision,
or to the reasons for
dissatisfaction given in its
notice of dissatisfaction. Any
decision of the DAB shall be
admissible in evidence in the
arbitration.
Arbitration may be commenced
prior to or after completion of
the Works. The obligations of
the Parties and DAB shall not be
altered by reason of any
arbitration being conducted
during the progress of the
Works.”
The Defendant owed the Plaintiff
for work done which was to be
paid in tranches after each
phase of work done and the
submission of an invoice.
Defendant received the invoices
for phases of work done but
refused to pay Plaintiff. The
defendant then terminated the
contract with the plaintiff.
The Plaintiff commenced an
action in the High Court by a
writ of summons that claimed
among other reliefs “a
declaration that the purported
termination of the contract by
the Defendant/Respondent herein
on the grounds of
non-performance or delayed
performance was false
procedurally wrong and unjust”
and further claimed for payment
for work done together with
interest.
Upon an application by the
Plaintiff for interlocutory
injunction or in the alternative
for a valuation of work done at
the construction site, the Court
declined to grant the
interlocutory injunction but
granted an order for both
parties to send their team of
quantity surveyors to value the
extent of work done before the
Plaintiff handed over the
construction site to the
Defendant. This report was
consensual and was filed and
presented to the High Court. The
Defendant was then allowed to
take over the construction site
and they appointed a new
contractor.
The Defendant refused to accept
to pay the amount agreed upon by
the team of quantity surveyors
and filed an application before
the Court to activate the
dispute settlement provisions of
the contract. This application
was granted and the court
referred the matter to a Dispute
Adjudication Board (hereinafter
referred to as DAB). The
Institution of Surveyors was
nominated by the agreement of
both parties. The DAB submitted
its decision to the Court
recommending the same amount as
the joint team of quantity
surveyors appointed by the
parties for the amount of work
done. Aggrieved by the decision
of DAB, the Defendant gave a
notice of dissatisfaction to the
Plaintiff. Plaintiff then filed
a motion for leave to sign final
judgment on the DAB decision
under Order 64 of the High Court
(Civil Procedure) Rules 2004,
(CI 47).
The trial High Court Judge
refused to grant the said
application to sign final
judgment and referred the matter
to international arbitration in
accordance with the FIDIC Rules.
Dissatisfied with the ruling of
the trial High Court, plaintiff
appealed to the Court of Appeal
which dismissed the appeal. It
is against this decision that
the plaintiff has appealed to
this court on the following
grounds as contained in the
Notice of Appeal.
Grounds of
Appeal
1.
The learned Court of Appeal
erred in law and in equity when
it affirmed the decision of the
High court dismissing the
application to sign final
judgment on the value of work
done which had been agreed upon
by both parties and confirmed by
the Dispute Adjudication Board
hereinafter called DAB.
2.
The Court of Appeal wrongly
affirmed the decision of the
High court which referred the
case to international
arbitration by ignoring the fact
that Appellants claim is
peculiarly for work done as
agreed between the parties and
confirmed by the court.
3.
The learned court’s
misapprehension of the rules
governing arbitration led to
make a reference to
international arbitration under
paragraph 20 of the FIDIC
contract when there was no such
basis and said reference
amounted to a reference for “its
own sake” occasioning injustice
to the
Plaintiff/Appellant/Applicant.
4.
The learned Appeal Court erred
when it refused to give weight
to the fact that Respondent’s
“notice of dissatisfaction” did
not conform to the definition of
a valid “notice of
dissatisfaction” by
demonstrating “serious
irregularity” and has been so
ruled by a ruling of the High
Court on record dated 4th July
2017.
5.
The ruling of the Court of
Appeal to the effect that
international arbitration was a
matter of course (since it is
set out in paragraph 20 of the
FIDIC contract) is a
misinterpretation of the law and
rules governing arbitration,
especially where there was no
basis from the peculiar
circumstances of this case for
such reference.
6.
The High Court’s definition of
an “arbitral award” to exclude
the DAB report dated 31st
January 2018 was wrong in law
and has occasioned a miscarriage
of justice to the Appellant.
7.
The Appellate Court in its
judgment ignored the clear and
unambiguous interpretation of
FIDIC clause 20.6 which stated
that only decisions of the DAB
which have “not become final and
binding” shall be settled by
international arbitration.
8.
The judgment of the Court of
Appeal dated 15th
November, 2018 is against the
weight of the evidence.
Issues in this Appeal
We have carefully examined the
eight grounds of appeal filed by
the plaintiff and argued by the
parties and are of the
considered view that they can
logically be grouped into three
main issues, namely;
i.
Whether the decision DAB process
was an arbitration and its
decision an arbitral award?
ii.
Whether
the decision of the DAB is
“final and binding” between the
parties; and
iii.
Whether the Court of Appeal
erred in affirming the decision
of the trial High Court to refer
the dispute between the parties
to international arbitration?
We now proceed to examine these
issues.
Was the DAB process an
Arbitration?
This issue is captured in ground
6 of the notice of appeal.
On this matter the trial court
in its ruling of 31st January
2018 (page 1521 of the record)
held as follows;
“I find that the parties
submitted themselves to a
Dispute Adjudication Board which
came out with a decision. The
respondent has filed a notice of
dissatisfaction with the said
decision. This decision was not
an arbitral award. In view of
this there is no arbitral award
properly so called which is
capable of being adopted and
entered by this court as final
judgment within the meaning of
Order 64 of C.I.47.”
The Court of Appeal affirmed
this finding of the trial High
Court when it stated at page 21
of its judgment dated 15th
November 2018 as follows;
“Indeed, under clause 20.4 of
the FIDIC Rules the DAB shall be
deemed not to be acting as
arbitrators”.
The Plaintiff is challenging
this holding by the courts
below. Counsel for the Plaintiff
argued before us that the DAB
process was an arbitration and
its decision an arbitral award.
Counsel referred to
KLIMATECHNIK ENGINEERING v.
SKANSKA JENSEN INTERNATIONAL
[2005-2006] SCGLR 913 at
925, where the court found that
the decisions of both
arbitrators and umpires are to
be treated as arbitral awards
under the
Arbitration Act,1961(Act 38).
As an arbitral award, the
plaintiff argued the Court must
comply with Order 64 of CI 47. R
12(1) which specifically
stipulates that, “No award shall
be set aside except on the
ground of perverseness or
misconduct of the arbitrator or
umpire” if is to set aside the
decision of the DAB. Counsel
submitted that in order for the
court to disregard the arbitral
award, the defendant must prove
the award is perverse or that
the arbitrators or umpires
misconducted themselves. As the
Defendant has failed to prove
any perverseness or misconduct,
counsel argued that the court
cannot set aside the decision of
the DAB.
The Defendant, on the other
hand, submitted that
there has
been no arbitration and
therefore no arbitral award
capable of adoption. The DAB
process, the Defendant
contended, was an expert
adjudication not arbitration. It
argued that once a Notice of
Dissatisfaction has been issued
within the stipulated time it is
enough to take the dispute
resolution to another level
which will culminate at
international arbitration.
The ruling of the trial High
Court which was affirmed by the
Court of Appeal was in respect
of an application by the
Plaintiff for the leave to sign
final judgement under Order 64
of C1.47. In
Klimatechnik Engineering Ltd v
Skanska Jensen International
[2005-2006] SCGLR 913 at 927
Georgina Wood JSC (as she then
was) stated; “The importance of
determining the statute under
which the application was
initiated cannot be
overemphasised”. See also
Akwass
Farms Ltd. v. Ghana Telecom Co
Ltd. (C.A., unreported, Suit No.
HI/30/2010, dated 9th December
2010).
Order 64, rule 1 of CI. 47
provides that, “if the parties
to an action desire that any
matter in dispute between them
in an action shall be referred
to the final decision of an
arbitrator, either party or both
parties may apply to the court
at any time before final
judgment for an order of
reference and on application the
Court may make an order of
reference accordingly”. Rule 8
then provides that the award of
the arbitrators “shall contain a
conclusive finding on each of
the matters referred. Rule 13
finally provides that if there
is no application to set aside
or remit an award under the
rules, a party may file the
award for incorporation into an
order of the court.
There are therefore two
conditions precedent to the
invocation of order 64, rule 13;
an arbitration and a final
award.
We begin our consideration of
this issue by reiterating the
admonition of Adinyira JSC
in BCM
Ghana Ltd v. Ashanti Goldfields
Ltd [2005-2008] SCGLR 602
at 611 that “The Courts must
strive to uphold dispute
resolution clauses in
agreements.”
Clause 20.4 of the FIDIC Rules
provides that, “The DAB shall be
deemed to be not acting as
arbitrators.” It further
provides that “neither party
shall be entitled to commence
arbitration of a dispute unless
a notice of dissatisfaction has
been given in accordance with
this sub-clause”. The DAB report
itself stated that; “The parties
therefore submitted that the DAB
resolves the dispute between
Tieso Ghana Ltd v Euroget
De-Invest by Adjudication as
opposed to Arbitration”.
It is therefore evident that at
the stage of the DAB,
arbitration has not commenced.
In fact clause 20.6 of the FIDIC
Rules then goes on to provide
for arbitration. The Plaintiff
has not provided us with any
reason why we should depart from
the clear express provision of
their agreement, as contained in
clause 20.4 of the FIDIC Rules,
that the DAB shall be deemed not
to be acting as arbitrators. We
therefore reject the contention
of the Plaintiff that the DAB
process was an arbitration and
affirm the decision of the trial
High Court and the Court of
Appeal that it was not.
Is the Decision of the DAB
“final and binding”?
We now consider the question
whether
the decision of the DAB is
“final and binding” and capable
of adoption as a final judgment
of a court under Order 64 of
C.I.47.
Clause 20.4 of the FIDIC Rules
provides that;
“If the DAB has given its
decision as to a matter in
dispute to both parties, and no
notice of dissatisfaction has
been given by either party
within 21 days after it received
the DAB’s decision then the
decision shall become final and
binding upon both parties”.
Both the trial High Court and
the Court of Appeal held that
the following the issuing of a
“Notice of Dissatisfaction” by
the Defendant the decision of
the DAB was not “final and
binding”. The Court of Appeal,
affirming the decision of the
High Court stated per Kwofie J.A
at page 22 of its judgement
dated 15th November 2018;
“It is my view that with the
defendant having given the
Notice of Dissatisfaction within
the time stipulated by the FIDIC
rules the decision of the DAB
cannot become final and binding
on the parties”.
The Plaintiff challenges this
finding by the High Court and
the Court of Appeal. The
Plaintiff argued that both the
value of work done determined by
the joint team of quantity
surveyors and the decision of
the DAB are “final and binding”
within the meaning of clause
20.6 of the FIDIC Rules. “The
DAB is thus enforceable and
final” it contended. The
Plaintiff conceded that the
Defendant did, in fact, issue a
Notice of Dissatisfaction within
the time frame stipulated by
clause 20.4 but argued that the
notice failed to point out why
the Defendant was dissatisfied
with the decision of the DAB.
The failure of the notice of
dissatisfaction to challenge the
decision of the DAB on any
substantive grounds or for
“serious irregularity”,
Plaintiff submitted, rendered
the notice nugatory.
The Defendant, on the other
hand, submitted that the FIDIC
Rules do not require it to
provide detailed reasons for its
dissatisfaction with the
decision of the DAB. It
contended that clause 20.4 of
the FIDIC Rules only requires
that “this notice of
dissatisfaction shall state that
it is given under this
sub-clause and shall set out the
matter in dispute and the
reason(s) for dissatisfaction”.
The Defendant therefore
submitted that its notice of
dissatisfaction that “Our client
has been served with a copy of
the decision of the DAB dated
28th of April 2017 and it is our
client’s instructions to say
that they are dissatisfied with
the said decision arrived at by
the DAB. It is our client’s
further instructions to say that
Tieso Ghana Limited is not
entitled to the sum stated in
the 28th April 2017 decision”
complies with the FIDIC Rules.
Clause 20.4 of the FIDIC Rules
provide that;
“If the DAB has given its
decision a s to a matter in
dispute to both Parties and no
notice of dissatisfaction has
been given by either party
within 21 days after it received
the DAB’s decision, then the
decision shall become final and
binding on both Parties”.
Both the trial High Court and
the Court of Appeal held that,
following the issuing of a
Notice of Dissatisfaction with
the DAB decision by the
defendant, that decision was not
final.
The Court of Appeal, affirming
the decision stated per Kwofie
J.A at page 22 of its judgment
of dated 15th
November 2018;
“It is my view that with the
defendant having given the
notice of dissatisfaction within
the time stipulate by the FIDIC
rules the decision of the DAB
cannot become final and binding
on the parties.
The plaintiff challenges this
finding by trial High Court and
the Court of Appeal.
The plaintiff argues that both
the value of work done
determined by the joint team of
quantity surveyors of and the
decision of the DAB are “final
and binding” within the meaning
of clause 20.6 of the FIDIC
Rules. “The DAB is thus
enforceable and final” it
contended. The Plaintiff
conceded that the Defendant
issued a Notice of
Dissatisfaction within the time
frame stipulated by clause 20.4
of the FIDIC Rules but argued
that the notice failed to point
out why the Defendant was
dissatisfied with the decision
of the DAB. The failure of the
Notice of Dissatisfaction to
challenge the decision of the
DAB on any substantive or
procedural grounds or for
“serious irregularity” rendered
the notice invalid, the
Plaintiff submitted.
The Defendant on the other hand,
submitted that the FIDIC rules
did not require it to provide
detailed seasons for its
dissatisfaction with the
decision of the DAB. It
contended that clause 20.4 of
the FIDIC rules only requires
that;
“this notice of dissatisfaction
shall state that it is given
under this sub-clause and shall
set out the matter in dispute
and the reason(s) for
dissatisfaction”
The defendant therefore
submitted that its notice of
dissatisfaction that “our client
has been served with a copy of
the decision of the DEAB dated
28th of April 2017
and it is our client’s
instructions to say that they
are dissatisfied with the said
decision arrived at by the DAB.
It is our client’s further
instructions to say that TIESO
Ghana Limited is not entitled to
the sum stated in the 28th
of April 2017 decision” complies
with the FIDIC Rules.
Having carefully considered the
arguments of the parties, the
FIDIC Rules and the law on
contractual dispute resolution
provisions, it is our considered
opinion that the parties agreed
to be governed by a dispute
resolution process provided for
under the FIDIC Rules and are
bound by it. Under these Rules,
the DAB process is an
intermediate expert adjudication
stage. The decision of the DAB
only becomes “final and binding”
if neither party gives a notice
of dissatisfaction within 21
days. Once a party gives a
notice of dissatisfaction within
the stipulated period, the DAB
decision is not “final and
binding.”
We therefore affirm the decision
of the High Court and the Court
of Appeal that the decision of
the DAB was not final and
binding and not capable of
adoption as a final judgement of
the Court under Order 64 of C.I.
47.
Was it an Error to Refer the
Dispute to International
Arbitration?
Following its dismissal of the
Plaintiff’s application for
leave to sign final judgement on
the decision of the DAB, the
trial High Court affirmed by the
Court of Appeal, referred the
dispute between the parties to
international arbitration under
the FIDIC Rules.
This has been heavily challenged
by the Plaintiff in grounds
2,3,5 and 8. The reference to
international arbitration has
been variously described by the
Plaintiff as a reference for
“its own sake” “a
misinterpretation of the law and
rules governing arbitration” and
being “against the weight of the
evidence”. The Plaintiff
contends that since both the
joint team of quantity surveyors
chosen by the parties and the
DAB arrived at the same figure
as the total amount due to the
it for work done, there was no
need to refer to the matter to
international arbitration, hence
the description a reference “for
its own sake”. It submitted that
the determination of the value
of work done by the quantity
surveyors and the DAB cannot
change or be altered and
therefore is final and binding
and cannot be the subject of
international arbitration. At
page 15 of its Statement of
Case, the Plaintiff stated its
position as follows:
“My Lords, it is the Appellant’s
respectful submission that as
long as the value of work done
and agreed upon by both parties
is confirmed it will be an
exercise in futility for any
court of law and equity to hold
that the same figure confirmed
and agreed by both parties as
work done and owed to the
Appellant be sent to further
international arbitration”.
The Plaintiff concluded that on
the peculiar facts of this case
since the quantity surveyors
appointed by the parties have
determined the value of work
done and it has been confirmed
by the DAB, there is no dispute
to be referred to international
arbitration.
The Defendant, on the other
hand, challenged the
interpretation placed on the
valuation of the quantity
surveyors and the decision of
the DAB. It argued the quantity
surveyors made an independent
valuation, which was not
accepted by the Defendant. It
also argued that the decision of
the DAB went beyond the
valuation of work done and
included other matters such as
calculation of interest. It
further submitted that it was
because they did not accept the
valuation of the quantity
surveyors that the matter was
referred to the DAB. They
therefore contended that
following its notice of
dissatisfaction to the DAB
decision, the trial High Court
and the Court of Appeal were
right in referring the dispute
to international arbitration in
accordance with the FIDIC rules.
The arguments being canvassed by
the Plaintiff before us were
urged on the Court of Appeal
which after consideration
rejected them. The Court of
Appeal stated its conclusion at
page 22 of its judgment as
follows;
“The Rules (FIDIC) have
therefore provided for a step by
step approach to dispute
resolution starting from
friendly dialogue and
negotiations, referral to
Dispute Adjudication Board and
where a Notice of
Dissatisfaction is given by
either party, then there would
be attempts to settle amicably
and where that fails
international arbitration”.
We have carefully considered the
facts of this case, the
submissions of the parties and
the FIDIC rules and find the
position of the Plaintiff
untenable. The parties
contracted to be governed by the
FIDIC Rules. These Rules provide
for a dispute resolution
process. The Plaintiff’s
contention that the dispute
between the parties has ended is
not borne out by the facts. The
Defendant did not accept the
valuation of the quantity
surveyors and gave a notice of
dissatisfaction after the DAB
decision. We therefore affirm
the decision of the High Court
and the Court of appeal to refer
the dispute between the parties
to international arbitration
under the FIDIC Rules.
In the circumstances, this
appeal fails in its entirety and
is accordingly dismissed.
(SGD) PROF. N. A. KOTEY
(JUSTICE OF THE SUPREME COURT)
ANSAH JSC:-
I agree with the reasoning and
conclusion of my brother Kotey.
J. ANSAH
(JUSTICE OF THE SUPREME COURT)
DOTSE JSC: -
I agree with the reasoning and
conclusion of my brother Kotey
JSC.
V. J. M. DOTSE
(JUSTICE OF THE SUPREME COURT)
YEBOAH JSC :-
I agree with the reasoning and
conclusion of my brother Kotey
JSC.
ANIN
YEBOAH
(JUSTICE OF THE SUPREME COURT)
MARFUL-SAU JSC:-
I agree with the
reasoning and conclusion of my
brother Kotey JSC.
S. K. MARFUL-SAU
(JUSTICE OF THE SUPREME COURT)
COUNSEL
ANKAMAH MENSAH FOR THE
PLAINTIFF/APPELLANT/APPELLANT.
YAW ESHUN WITH AMERLEY ADJOTEYE
FOR THE DEFENDANT/ RESPONDENT/
RESPONDENT.
|