Judgment No. SC.43/06
Appeal No. 311/04
(PRIVATE) LIMITED v (1) WINSLEY MILITALA (2)
C A BANDA N.O.
COURT OF ZIMBABWE
JA, MALABA JA & GARWE JA
JULY 11 & OCTOBER 16, 2006
M Katsande, for the
Mugandiwa, for the
appearance for the second respondent
CHEDA JA: This is an appeal
against the judgment of the High Court which dismissed an application
by the appellant to set aside
an arbitration award.
parties entered into an agreement of sale of a subdivision of
immovable property which was registered in the name of the appellant.
The property was not developed.
parties entered into another agreement for the construction of a
house on the property.
was also stipulated in the agreements that in the event of any
dispute the parties would refer such dispute to arbitration.
dispute did arise and was accordingly referred to arbitration.
second respondent was appointed as the arbitrator.
28 August 2003, the arbitrator issued the following award on the
dispute between the parties:
respondent shall pay the claimant an amount of money being the
equivalent of the current
value of Stand number 2937 Bluff Hill Township
of Stand 1120 Bluff Hill less the value
2. The President to
the Estate Agents Council shall appoint an estate
to do an evaluation of the property and the
of the estate agent so appointed shall be final and binding on
3. The arbitrators fees
amounting to $165 000-00 shall be shared in equal parts
parties, that is $82 500-00 each.
4. Each party shall pay its own
this award the appellant made a court application to have the award
set aside and that the Commercial Arbitration Centre
be directed to
refer the dispute to a different arbitrator for arbitration.
High Court dismissed the application. The appellant now appeals
against that decision.
his founding affidavit, Mr Mutunami, who deposed to the affidavit on
behalf of the appellant, raised the following main grounds
objecting to the award -
That the proposed settlement should have
been formulated by both parties to
arbitration but it was formulated by the respondent to the total
exclusion of the
applicant, in breach of Article 34 of the Arbitration Act No
7:02 of 1996 (the
2. That it was
not true that the parties came to an agreement and no
in contemplation of Article 30 of the Act.
the principles of natural justice were breached as
the applicant did not participate
in the formulation of the proposed settlement.
the award failed to state the place of arbitration as
required by Article
31(3) as read with Article 20(1) of the Act.
as he represented the applicant at the arbitration he had
to seek the resolution
of the Board of Directors regarding the terms and
of the proposed settlement.
6. That the
award was in conflict with the public policy of
it contravened Article 34(2)(b)(ii) of the Act.
That the applicant had proved that it had lawfully terminated
inseparable agreements between the parties.
Zimbabwe arbitration is governed by Act 7:02 of 1996.
34 sets out grounds on which an arbitral award may be set aside.
APPLICATION FOR SETTING
ASIDE AS EXCLUSIVE RECOURSE AGAINST ARBITRAL AWARD
(1) Recourse to a court against
an arbitral award may be made only by an application for
setting aside in accordance with paragraphs
(2) and (3) of this
(2) An arbitral award may be set
aside by the High Court only if-
(a) the party making
the application furnishes proof that-
(i) a party to
the arbitration agreement referred to in article 7 was
incapacity; or the said agreement is not valid under the
which the parties have subjected it or, failing any indication
question, under the law of Zimbabwe; or
the party making the application was not given
of the appointment
of an arbitrator or of the arbitral proceedings
or was otherwise
unable to present his case; or
(iii) the award deals
with a dispute not contemplated by or not falling
the terms of the submission to arbitration, or contains
on matters beyond the scope of the submissions to
provided that, if the decisions on matters submitted to
can be separated from those not so submitted, only that
of the award which contains decisions on matters not
to arbitration may not be set aside; or
composition of the arbitral tribunal or the arbitral procedure
was not in accordance with the agreement of the parties, unless
such agreement was in conflict with a provision of this Model
from which the parties cannot derogate, or, failing such
was not in accordance with this Model Law; or
(b) the High Court finds
subject-matter of the dispute is not capable of settlement
(ii) the award
is in conflict with the public policy of Zimbabwe.
(3) An application for setting
aside may not be made after three months have elapsed from the date
on which the party making that
application had received the award or,
if a request had been made under article 33, from the date on which
that request had been
disposed of by the arbitral tribunal.
(4) The High Court, when asked to
set aside an award, may, where appropriate and so requested by a
party, suspend the setting aside
proceedings for a period of time
determined by it in order to give the arbitral tribunal an
opportunity to resume the arbitral proceedings
or to take such other
action as in the arbitral tribunals opinion will eliminate the
grounds for setting aside.
(5) For the
avoidance of doubt, and without limiting the generality of
paragraph (2)(b)(ii) of this article, it is
declared that an
award is in conflict with the public policy of Zimbabwe if-
(a) the making of the award
was induced or effected by fraud or corruption;
a breach of the rules of natural justice occurred in
the making of the
As can be seen from the
appellants application to the High Court, the only relevant
grounds on which the award could be challenged
by the appellant are
that the award is in conflict with the public policy of Zimbabwe, and
that a breach of the rules of natural
justice occurred in connection
with the making of the award.
(5) of Article 34 declares or defines what is meant by an award that
is in conflict with the public policy of Zimbabwe
the making of the award was induced or effected by fraud,
(b) a breach of the
rules of natural justice occurred in connection with the making
When the appellant approached
the High Court, it did not allege or show that the award had been
induced by either fraud or corruption.
did it show that the rules of natural justice were breached.
to the arbitrators award the parties attended a hearing held on 21
August 2003 and an agreement was reached. It is
not for this appeal
court to decide whether this is true or not.
the other hand, the letter from Ziweni & Company, addressed to
the arbitrator on 21 August, indicates that it is one of the
directors of the appellant who was not present at the arbitration who
rejected the terms of the settlement. If there had been no
and no settlement terms, the legal practitioners would not have
addressed a letter to the arbitrator in those terms.
puts beyond doubt the fact that there was a hearing which was
attended by both parties.
settlement detailed in the letter from Wintertons dated 21 August
2003 was reached, and the award was based on that settlement.
the circumstances there was no basis for challenging the award or
suggesting that the rules of natural justice were breached.
is therefore no legal basis for attacking the award.
other ground concerning the failure to mention the place where the
hearing was held is insufficient to invalidate an award that
agreed to by both parties.
do not consider that the failure to mention the place is fatal to the
other complaints raised by the appellant fall away once it is clear
that the parties appeared before the arbitrator and reached
settlement. For the other director to reject a settlement also
confirms that at least there was a settlement which was reported
him by those who attended before the arbitrator.
therefore see no merit in the appeal. It is dismissed with costs.
JA: I agree.
JA: I agree.
F M Katsande & Partners,
appellant's legal practitioners
first respondent's legal practitioners