Carter (t/a Michael Carter Partnership) v Harold Simpson Associates (Architects) Ltd

JurisdictionUK Non-devolved
JudgeLord Hoffmann
Judgment Date14 June 2004
Neutral Citation[2004] UKPC 29
CourtPrivy Council
Docket NumberAppeal No. 27 of 2003
Date14 June 2004
Michael Carter (trading as Michael Carter Partnership)
Appellant
and
Harold Simpson Associates (Architects) Limited
Respondent

[2004] UKPC 29

Present at the hearing:-

Lord Hoffmann

Lord Hope of Craighead

Lord Scott of Foscote

Lord Rodger of Earlsferry

Dame Sian Elias

Appeal No. 27 of 2003

Privy Council

[Delivered by Lord Hoffmann]

1

The parties are both firms of architects who entered into a written partnership agreement dated 7 November 1994 for the purpose of a single joint venture to provide architectural services for the construction of the Montego Bay Civic Centre. Their Lordships will refer to the two firms, one of which was incorporated, by the names of their principals, Mr Simpson and Mr Carter. The partnership agreement contained an arbitration clause.

2

Differences having arisen between the parties, they made a joint written submission to arbitration on 5 December 1997. The submission read:

"We jointly agree to the appointment of Maurice Stoppi acting as mediator/arbitrator to determine the issue(s) in the current dispute between us. We further agree that we share equally his charges of J$4,000 per hour and his reasonable reimbursable costs and that his Award when given in writing will be accepted by us as final and binding."

3

It appears that substantial sums were held in partnership bank accounts and the parties agreed that in order to allow the award to be taken up as soon as possible, the arbitrator's costs and charges would in the first instance be paid out of partnership money. This agreement was recorded in a letter dated 24 July 1998 from Ms Carol Davis, Mr Simpson's attorney, to Messrs Ripton Macpherson, Mr Carter's attorneys:

"As you are aware our respective clients have arranged for Mr Stoppi's fees to be paid from funds available in the joint venture account.

This is to confirm our telephone conversation to the effect that this payment is an advance from the joint venture account, to facilitate the release of the arbitration award. However as is usual the parties will of course have to abide the order for costs (if any) made by the arbitrator. As such either party will have to refund monies advanced from the joint venture account in the event that the arbitrator makes an order for costs against it."

4

The submission itself is unilluminating about the matters in dispute but these were no doubt clarified in the pleadings which the parties exchanged in July and August 1998. Mr Simpson made a claim and Mr Carter a counterclaim. Witnesses gave evidence under oath and were cross-examined. Both parties made submissions.

5

The arbitrator noted that neither party had requested a reasoned award and, after receiving payment of $422,050 in respect of his fees and charges, published his award on 23 September 1998:

"7.1 Now I Maurice Stoppi the arbitrator appointed as aforesaid, having considered the representations of the parties, their witnesses and documents submitted by them in evidence do hereby award and direct that the joint venture in the first instance and then the respondent do forthwith pay to the claimant the total sum of [$J3,741,317.65] in full and final settlement of items shown in claimant's summary of claim of July 28, 1998 and all other issues in this reference as follows:

1. Short payment on fees)

3. Due on new tender price)

2,680,186.65

2. Architectural cost for work done

I make no

between 1973 and 1994

award in respect of this item.

4. Lump sum for post-contract architectural fees

See 7.3

5. Interest

1,061,131.00

Total

$3,741,317.65

7.2 I have further considered the representations and evidence of the respondent in respect of their counter-claim dated 18 June 1998 with which I find no merit. I therefore make no award in respect of the respondent's counter-claim.

7.3 And I further award and direct that in accordance with the notes of a meeting between the parties held on September 11 1996 and in pursuance of clause 10.01 of the Joint Venture Partnership Agreement dated November 7 1994 … and in keeping with the wishes of the parties to mutually determine their joint venture agreement, such termination shall be effected in the following manner:

7.3.1 within 60 calendar days of the signing of the construction contract between the employer and contractor for the construction of the Montego Bay civic centre, the respondent shall pay to the claimant … $371,652.

7.3.2 upon receipt of payment of the above amount by the claimant, the Joint Venture Partnership Agreement of November 7 1994 shall be deemed to be terminated and shall thereafter be of no effect.

7.4 And I further award and direct that the respondent bear and pay his own and the claimant's costs in and of the arbitration including my fees and charges. Such amounts for costs shall be agreed between the parties or submitted after the publication of this award to the court for taxation."

6

Section 13 of the Arbitration Act (the whole of which is substantially in the same terms as the English Arbitration Act 1889) provides that -

"an award on a submission may, by leave of the Court or a Judge, be enforced in the same manner as a judgment or order to the same effect."

7

On 9 November 1998 Mr Simpson issued an originating summons (Suit No E 538 of 1998) seeking the leave of the court. Before it could be heard, other events intervened. The construction contract for the Civic Centre was signed on 29 September 1998 and the sum mentioned in clause 7.3.1 of the award accordingly became payable on 28 November 1998, although the parties seem to have treated it as payable on 27 December. On 22 December 1998 Mr Carter issued an originating summons (Suit No E/506 of 1998) for an order setting aside paragraphs 7.1 and 7.2 of the award for an error of law on its face. On 24 December 1998 Mr Carter sent Mr Simpson a cheque for $371,652 and said that pursuant to paragraph 7.3.2 the joint venture was now terminated. Mr Simpson did not accept the cheque; he took the view that the award was one and indivisible and that paragraph 7.3.2 could not take effect until the whole award had been paid.

8

The originating summons of 22 December 1998 came before Ellis J on 7 January 1999. He set aside the award. Mr Simpson appealed and on 30 July 1999 the appeal was allowed with costs, which were subsequently taxed at $264,983. There was no further appeal against this order.

9

On 18 and 20 August 1999, after the award had been reinstated by the Court of Appeal, the originating summons pursuant to section 13 came before Harris J. She took the view that in principle leave to enforce the award should be given but that the form needed to be amended. Her order therefore said:

"1. That the plaintiff may have the leave of this Honourable Court pursuant to section 13 of the Arbitration Act for the award of the arbitrator herein to be enforced in the same manner as a judgment of the court.

2. Matter remitted to arbitrator to amend award to place it in a form in which it will be enforceable."

10

It would seem that the point which troubled the judge was the direction in paragraph 7.1 that "the joint venture in the first instance and then the respondent" pay the sum specified to the claimant. Their Lordships think that it is clear enough that the sums in question were to come out of the joint venture funds and, so far as they were insufficient, to be paid by Mr Carter personally. But the judge thought that the award should say exactly how much should come out of identified joint venture funds and what the balance payable by Mr Carter would be.

11

A discretionary power to remit an award is contained in section 11 of the Act, reproducing the terms of section 10 of the 1889 Act. Authority for the use of this power so that the award may be amended to be put into a form which is enforceable is to be found in the decision of Diplock J in Margulies Brothers Ltd v Dafnis Thomaides & Co (UK)...

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5 cases
  • Reliance Industries Ltd v The Union of India
    • United Kingdom
    • Queen's Bench Division (Commercial Court)
    • 12 Febrero 2020
    ...cannot exceed what is necessary to give effect to the order for remittal”: Carter v Harold Simpson Associates (Architects) Limited [2005] 1 WLR 919 at 9 I do not regard this description by the Government of the jurisdictional framework as controversial, for present purposes. 10 The Governm......
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    ...miscarriage of justice. 18 Remitting is a discretionary power, per Lord Hoffman at para 11 of Michael Carter v Harold Simpson Associates 2004 UKPC 29. 19 The test for remitting is captured in Danae Air Transport v Air Canada [1999] 2 All ER (Comm) a. There it is said by Tuckey LJ at para 2......
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    ...the Privy Council's decision in Michael Carter (trading as Michael Carter Partnership) v. Harold Simpson Associates (Architects) Ltd . [2004] U.K.P.C. 29, where Johnson v. Latham is referred to. 51 It was Mr. Goffe's submission that the Award is unenforceable in its present form and that a......
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