Mulinge v County Government of Mombasa & another (Miscellaneous Application E038 of 2023) [2023] KEHC 27249 (KLR) (14 December 2023) (Ruling)

Citation
Mulinge v County Government of Mombasa & another [2023] KEHC 27249 (KLR)
Media Neutral Citation
[2023] KEHC 27249 (KLR)
Court
High Court
Court station
High Court at Mombasa
Outcome
Court issues further directions
Case number
Miscellaneous Application E038 of 2023
Judges
DKN Magare
Judgment date
14 December 2023
Language
English
Type
Judgment
Original source file
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Order
a. The parties shall appoint a sole Arbitrator within 30 days of this Order failing of which the Chairman of the Chartered Institute of Arbitrators shall appoint the Arbitrator to conduct the Arbitration. b. Costs shall be in the Arbitration.
1.This is a Ruling in respect of the Chamber Summons Application dated 3rd May, 2023. The said Application sought the following prayers: -i.That this Honourable Court be pleased to certify this application as urgent and service thereof be dispensed with in the first instance.ii.That this Honourable Court be pleased to grant he Applicant leave to commence arbitration proceedings.iii.That this Honourable Court be pleased to issue an arbitration order.iv.That this Honourable Court be pleased to issue an order directed at the Chair of the Chartered Institute of Arbitrators, Kenya to assign an arbitrator to take conduct of the arbitral proceedings.v.That the Court be at liberty to make such further and other Orders that it deems fir to meet the ends of justice.vi.That the costs of this application be borne by the Respondents.
2.The Defendant herein opposed the said and set out the following grounds; -a.Spentb.This Court be pleased to grant the Applicant eave to commence Arbitration Proceedings.c.This Curt be pleased to issue an Arbitration Order.d.This Court be pleased to issue an Order directed at the Chair of the Chartered Institute of Arbitrators.
3.The Respondents filed a Preliminary Objection dated 20th June 2023. They posed that the court lacks jurisdiction as the orders seek the court to interfere with the party autonomy in Arbitration.
4.Their main contention is thus that parties should agree on the Arbitrator and the court should not impose an Arbitrator on the parties.
5.They then prayed that the Application be struck out with costs.
6.Parties filed written submissions which I have considered. The Applicant materially submitted that the Preliminary Objection does not fit the parameters settled in the locus classicus case of Mukisa Biscuits Manufacturing Company Limited v West End Distributors Limited 1969 EA 699. Thus, it did not raise a pure point of law as facts needed to be ascertained and production of evidence was necessary to establish the allegations in the Preliminary Objection.
7.On the merits of the Application, the Applicant submitted that the Court had jurisdiction to issue an order to enable the Arbitration process by appointing the Arbitrator. It was submitted that the Defendant had refused to settle the claim out of Court.
8.The Respondents on the other hand have relied on the Sections 12(30),(4)&(5) of the Arbitration Act and submitted that the Court has no jurisdiction to entertain the Application which seeks to negate party autonomy in Appointing an Arbitrator.
9.Reliance was also placed on the case of Wachira Wahome v Kenya Automotive Repairs Association (2011) eKLR to canvass the argument that the Applicant did not follow the steps in the impugned section sot he Arbitration Act before instituting the instant Application.
Analysis
10.In order to deal with the Preliminary Objection in the first instance, I have perused the Sections of the Law from which it emanates.
11.I note that Section 12 (2), (3),(4) & (5) of the Arbitration Act permit this Court to intervene and appoint an arbitrator where parties do not agree on the Arbitrator or either party is not willing to participate in the appointment thereof. It provides in extenso as follows:(2) The parties are free to agree on a procedure of appointing the arbitrator or arbitrators and any chairman and failing such agreement— (a) in an arbitration with three arbitrators, each party shall appoint one arbitrator and the two arbitrators so appointed shall appoint the arbitrator; (b) in an arbitration with two arbitrators, each party shall appoint one arbitrator; and (c) in an arbitration with one arbitrator, the parties shall agree on the arbitrator to be appointed. (3) Unless the parties otherwise agree, where each of two parties to an arbitration agreement is to appoint an arbitrator and one party (“the party in default”)— (a) has indicated that he is unwilling to do so; (b) fails to do so within the time allowed under the arbitration agreement; or (c) fails to do so within fourteen days (where the arbitration agreement does not limit the time within which an arbitrator must be appointed by a party), the other party, having duly appointed an arbitrator, may give notice in writing to the party in default that he proposes to appoint his arbitrator to act as sole arbitrator. (4) If the party in default does not, within fourteen days after notice under subsection (3) has been given — (a) make the required appointment; and (b) notify the other party that he has done so, the other party may appoint his arbitrator as sole arbitrator, and the award of that arbitrator shall be binding on both parties as if he had been so appointed by agreement. (5) Where a sole arbitrator has been appointed under subsection (4), the party in default may, upon notice to the other party, apply to the High Court within fourteen days to have the appointment set aside
12.My understanding of the impugned law is that the High Court may intervene with a view to facilitating the appointment of an Arbitrator where the parties disagree or either party is unwilling to cooperate in the process leading to the appointment of the Arbitrator. It does not thus mean that the High Court has no jurisdiction whatsoever to intervene and dictate on the appointment of the Arbitrator. That is not the letter and spirit of the Arbitration Statute. The Preliminary Objection is thus without merit.
13.The Arbitration process is a party led matter. The court’s right is severely restricted. However, the Court has a duty to facilitate the Arbitration process. In the case of Teejay Estates Limited v Vihar Construction Limited (Miscellaneous Civil Application E184 of 2021) [2022] KEHC 121 (KLR) (Commercial and Tax) (18 February 2022) (Ruling), where justice A. Mabeya, FCI Arb, stated as doth: -“The restriction on the jurisdiction of this Court on matters arbitral is founded on the fact that arbitration is simply a matter of agreement between parties. When parties agree that their dispute is to be settled by an arbitrator, and not by the national courts as by law provided, they also agree to accept the arbitrator’s view of the facts and the meaning of the contract between them. In this regard, courts will not sit to hear the claims of factual or legal error by an arbitrator as an appellate court does in reviewing decisions of Lower Courts. This is the party autonomy that is embedded in the Arbitration Act.
18.The above position has been well reiterated by the courts of this country. In Synergy Industrial Credit Ltd v Cape Holdings Ltd [2020] eKLR, the Court of Appeal delivered itself thus: -“One of the significant features of the Arbitration Act (the Act) is the principle of party autonomy, which entitles parties to have their disputes resolved by the forum and in the manner of their choice. For that very reason, the instances when the court may intervene in arbitral proceedings or interfere with an arbitral award are not at large; they are few and only those specified by the Act”.
14.Therefore, considering the merits of the Application before me, I think it would be proper and just for me to issue directions for the appointment of the Arbitrator to forestall these intense pre-arbitration disputes that serve no justice to either party. I say so because there is a clear dispute on the appointment of the Arbitrator. Even by objecting to the Application herein, the Respondents have apparently indicated their repulsion to the mode of action poised by the Applicant which is the appointment of the Arbitrator and consequential reference of the matter to Arbitration.
15.The Applicant has demonstrated that the Respondent is not amiable to the settling the claim out of court. There is no dispute as to the existence of proper Arbitration agreement. It is thus in the inherent power of this Court to facilitate the Arbitration process as anticipated under Article 159 (2)(c) of the Constitution. I am fortified by the reasoning of the court in Cubic Business Solutions v Spectre International Limited (2021)e KLR as follows:The statute expressly mandates the High Court to appoint the Arbitrator. In my considered opinion, the court has an inherent powers to make such orders or to give such directions as may be necessary for the ends of justice.
16.In the circumstances, the Application is meritorious.
Determination
17.In the upshot I make the following orders: -a.The parties shall appoint a sole Arbitrator within 30 days of this Order failing of which the Chairman of the Chartered Institute of Arbitrators shall appoint the Arbitrator to conduct the Arbitration.b.Costs shall be in the Arbitration.
DELIVERED, DATED AND AT MOMBASA ON THIS 14TH DAY OF DECEMBER, 2023. RULING DELIVERED THROUGH MICROSOFT TEAMS ONLINE PLATFORM.KIZITO MAGAREJUDGEIn the presence of: -No appearance for partiesCourt Assistant - Brian
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