Hall & Wodehouse Ltd v Panorama Hotel Properties Ltd
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE EDMUND DAVIES,LORD JUSTICE MEGAW |
| Judgment Date | 18 December 1973 |
| Judgment citation (vLex) | [1973] EWCA Civ J1218-2 |
| Court | Court of Appeal (Civil Division) |
| Date | 18 December 1973 |
[1973] EWCA Civ J1218-2
In The Supreme Court of Judicature
Court of Appeal
(Appeal of defendants from judgment of Mr. Justice Chapman, London, witheut a jury, dated June 14, 1973)
Lord Justice Edmund Davies,
Lord Justice Megaw and
Mr. Justice Thompson.
MR B. LINCOLN, Q. C. and MR D. WRIGHT, (instructed by Messrs. Egerton, Summer & Co.) appeared on behalf of the Appellants (Defendants).
MR R. GATEHOUSE, Q. C. and MR C. BEAUMONT, (instructed by Messrs. Ward, Bowie & Co.) appeared on behalf of the Respondents (Plaintiffs).
On August 7th, 1972, the learned arbitrator (Mr. R. L. A. Goff, Q. C.) made an award in respect of certain "disputes or differences" which had arisen relating to an agreement entered into by the parties to these proceedings on July 28th, 1966. The document appointing him -recited that, "A dispute or difference has arisen In connection with the said contract concerning the liability for payment of certain Items connected with the erection and completion of an hotel", and he was "to hear and determine the matter". The terms of his award now challenged are that the defendants must pay to the plaintiffs - under paragraph 3 thereof - the sum of 32,252.90; under paragraph 6, that they pay 8 percent, per annum on that sum; and under paragraph 8, that they pay the costs of the award, fixed at 1,890.
In September, 1972, the plaintiffs made application for leave to enforce that award in the same manner as a judgment. They did this pursuant to Section 26 of the Arbitration Act 1950, which provides that, "An award of an arbitration agreement may by leave of the High Court or a judge thereof be enforced in the same manner as a judgment or order to the same effect, and where leave is so given judgment may be entered in terms of the award." But, before the successful plaintiffs could proceed further, the defendants, pursuant to Section 22 of the Act and Order 73, Rule 22, moved to have the award set aside or remitted for the reconsideration of the learned arbitrator. This Motion was heard and dismissed by Mr. Justice Bean on December 5th, 1972, and, as appears from his judgment, the defendants were then alleging, (1) error on the face of the award, (2) "excessive jurisdiction by the arbitrator", and (3) misconduct by him. (1) disappeared from the case, the defendants ultimatelyconceding that there was no such error. Mr. Justice Bean held that (2) and (3) were also witheut substance, saying: "In my judgment, It Is not open to the respondents …. to re-open the matter by alleging excessive jurisdiction or misconduct, when what they are really saying Is that the arbitrator misled himself on some facts and failed to take into account others." We were told that notice of appeal from that judgment was given, but it was not pursued and It therefore remains unchallenged.
I have referred to it now because what happened (and, perhaps equally Important, what did not happen) before Mr. Justice Eean is not witheut significance in relation to the present appeal. It comes before the court in this way. Pursuant to the plaintiffs' originating motion under Order 37, Rule 2, on March 9th last Master Jacob granted the plaintiffs leave to enforce paragraphs 3, 6 and 8 of the award in the same manner as a judgment. The defendants appealed therefrom, but on June 14th Mr. Justice Chapman upheld the Master's Order, and it is against the decision of the learned judge that the defendants now appeal to this court. A preliminary question arose as to whether they were within time in taking this step, the answer depending on whether this is to be regarded as Interlocutory or a final appeal. For my part, I find It unnecessary to express any final conclusion on the matter, and I am for present purposes prepared to proceed upon the basis that the defendants are not out of time, and this particularly as the plaintiffs do not take objection and that, in any event, it is desirable that the court should express its view on the merits of the case and so dispose of this prolonged litigation. Another question raised was whether, in the light of Mr. Justice Chapman'srefusal of leave to appeal, It was necessary to obtain the leave of this court before the defendants could proceed before us. For a like reason, I do not find it necessary to deal with that question either in coming to a conclusion regarding the outcome of this appeal.
I now turn to the facts. On July 18th, 1966, the defendants entered into a building contract for the erection of a hotel and other buildings on a site In Bournemouth. On July 28th they contracted to grant to the plaintiffs two leases of 42 years' duration of certain parts of the land, Including the site of the hotel, the defendants undertaking to complete the building works as soon as practicable. This latter agreement contained an arbitration clause, and differences in connection with the contract having arisen, Mr. Goff was appointed arbitrator thereon, as I have already related, on February 28th, 1968, But the parties sensibly did not halt completion of the contract while awaiting for the arbitration to be held. Although the principal buildings were completed In 1967, a substantial amount of Interior furnishing required to be done. Financial difficulties arose in connection with these, and, to overcome them, on September 25th, 1963, the plaintiffs and defendants entered into a further agreement whereby they each undertook to contribute money to a common fund It being estimated that about 48,000 would be required for finishing work. What in effect happened was that the plaintiffs contributed .29,000 and the defendants 19,613 to the fund, which therefore stood at 48,613. These contributions were made "entirely witheut prejudice to the matters to be submitted to the arbitrator". The money so provided was used for its designated purpose, and at the time of thearbitration in 1972 there remained in the common fund 5,151 and some accrued interest, As this situation had arisen by reason of events occurring since the appointment of the arbitrator, he wisely insisted that his jurisdiction to deal with this balance be clarified, and, as a result, during the arbitration the parties entered into a yet further agreement on July 24th, 1972, whereby It was agreed that the 5,151 should be paid out to the plaintiffs and that the arbitrator should have jurisdiction -co give effect to the agreement as part of his award,
The 32,252 principal sum awarded to the plaintiffs was arrived at in this way; (a) Whereas the plaintiffs claimed 29,000 in respect of balance of builders' account, they were awarded 19,387. As the methed whereby this sum was calculated has been keenly contested before us, I had better deal with it at once. For the plaintiffs it is said that it was arrived at by deducting from the 48,613 two undisputed items of 5,151 and 4,462; this left a disputed balance of 39,000 In the common fund; from that balance the arbitrator deducted the 19,613 contributed by the defendants, and that left the final sum of 19,387 awarded to the plaintiffs. The defendants, on the other hand, resist that any credit, was given to them for their 19,613, in that the 19,387 was calculated by adding together the cost of some of the items of finishing work which undoubtedly do total the figure of 19,387. (b) The arbitrator awarded the plaintiffs in respect of Items they alleged to be the responsibility of the defendants the full sum they claimed, namely, 2,960.90. (c) In respect of items which the defendants were alleged to have failed to do in accordance with specification, instead of 21,150 claimed, he awarded the plaintiffs 8,090.(d) For professional fees, Instead of the 6,000 claimed, the arbitrator awarded 1,815.
By their Notice of Appeal the defendants sought to attack the award, first, on the ground that It was simply declaratory and left undecided the liability in law to pay the sum awarded. But the terms of the award itself make clear that such an objection could not be sustained and it was abandoned before us. I must confess that, at the early stages of his address, I had some difficulty in following upon what remaining points Mr. Lincoln was seeking to rely. My difficulty was not lessened by the absence from the Notice of Appeal of any indication of the Order sought from this court, save as to the costs of this appeal. But Mr. Lincoln certainly challenged before us the jurisdiction of the learned judge to make the award he did. As to this, it Is sufficient to observe that this first point was, as I am satisfied, not taken during the arbitration, and it Is not raised in the Notice of Appeal, though (as I have already said) before Mr. Justice Bean "excessive jurisdiction by the arbitrator" had been alleged. Be that as it may, I hold that the learned arbitrator did not go outside the issues which, on the pleadings, were submitted for his determination.
The substance of the defendants' appeal is that obscurity exists as to how the award is to be complied with, and that manifest injustice will result unless either (1) the matter is remitted back for him to clear away the obscurity, or (2) the plaintiffs are left to enforce their award by suing upon it. I think the defendants are in considerable and, indeed, insurmountable difficulty. In Margulies Bros. Ltd. -v- Dafuis Themaides & Go. (U. K.) Ltd. (1859...
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