Introduction
1. This ruling determines the Applicant’s Chamber Summons Application dated 17th April 2024 in which the Applicant seeks the adoption of the arbitral award dated 1st May 2023, Dr. Arch. Sylvia Kasanga, Sole Arbitrator.
2. The background of the matter is that the parties herein entered into an agreement dated 26th August 2015 for the construction, supply of materials, and installation including electrical works and plumbing, mechanical, external, and builders work associated with construction of proposed commercial development on L.R. NO. 13330/445. The agreement had an arbitration clause under Article 45 of the Agreement.
3. The Respondent failed to pay all the sums due to the Applicant under the agreement and at the request of the Applicant, the Architectural Association of Kenya appointed one, Dr. Arch. Sylvia Kasanga, as the sole Arbitrator.
4. Upon conclusion of the arbitration proceedings, the arbitrator the Arbitrator made a finding in favour of the Applicant and published the award on 1st May 2023 in the following terms; -
i. That within 90 days of the date of the Award, the Respondent shall pay the Claimant the sum of Kshs. 145,035,854.80
ii. That in default thereof, simple interest shall accrue at the rate of 2% points above the Central Bank of Kenya average rare base lending prevailing as at the time of payment, until the amount is paid in full.
iii. That each party shall bear its own costs.
iv. That each party shall bear its own portion of the costs of the Final Award.
5. The applicant subsequently filed the instant application seeking orders that; -
i. The court dies recognize the award dated 1st May 2023 as binding
ii. The court grants leave to the Applicant to enforce the award dated 1st May 2023 as a decree of the court.
iii. That costs be provided for.
6. The application is brought under Section 36 (1) and (3) of the Arbitration Act, 1995, and Rules 6 & 9 of the Arbitration Rules 1997. It is supported by the affidavit dated sworn on 17th April 2023 by Wang Jianzhong, the Applicant’s director.
7. It is deponed by the Applicant that the Respondent has not made any application to set aside the Arbitral Award herein and the propriety of the award has never been challenged or otherwise disputed since its delivery.
8. The Respondent did not file any response to the application, neither did they file any submissions in the matter. The application is therefore essentially unopposed.
9. The Applicant filed its submissions dated 14th October 2024 which I have considered. The main issue for determination is whether the applicant has met the conditions set under the Arbitration Act for the enforcement of an arbitral award.
10. The Applicant maintained that the award should be adopted as it has not been challenged or otherwise set aside since its publication.
Determination
11. The applicable law is Section 36 of the Arbitration Act which sets out the legal parameters governing the enforcement and adoption of an arbitral award in the following terms; -
“36. Recognition and enforcement of awards
(1) A domestic arbitral award, shall be recognized as binding and, upon application in writing to the High Court, shall be enforced subject to this section and section 37.
(2) …………….
(3) Unless the High Court otherwise orders, the party relying on an arbitral award or applying for its enforcement shall furnish—
(a) the original arbitral award or a duly certified copy of it; and
(b) the original arbitration agreement or a duly certified copy of it.
12. In Samura Engineering Limited vs Don-Wood Co Ltd [2014] eKLR it was held: -
“Of course, section 36(1) of the Act requires an application in writing for recognition and enforcement of an award to be made. But, the application is subject to sections 36 and 37 of the Act, and I should add, to the Constitution. Section 36(3) of the Act makes it mandatory that the party applying for recognition and enforcement of the award should file; 1) the duly authenticated original award or a duly certified copy of it; and 2) the original arbitration agreement or certified copy of it. Doubtless, the award must be filed…”
13. In the instant case, having carefully reviewed the Applicant’s notice of motion application together with the supporting affidavit and its attachments, I find that the Applicant has met the preconditions set under Section 36 of the Act for the enforcement of the award.
14. Ordinarily, the onus would have shifted to the Respondent to demonstrate why the award should not be adopted. However, the Respondent having failed to file any response to the application, the application is essentially unopposed.
15. It is however important to note that Section 37 of the Arbitration Act guides the court in determining whether or not it should recognize and enforce an award. The Section provides as follows; -
“37. Grounds for refusal of recognition of enforcement
(1) The recognition or enforcement of an arbitral award, irrespective of the state in which it was made, may be refused only—
(a) at the request of the party against whom it is invoked, if that party furnishes to the High Court proof that—
(i) a party to the arbitration agreement was under some incapacity; or
(ii) the arbitration agreement is not valid under the law to which the parties have subjected it or, failing any indication of that law, under the law of the state where the arbitral award was made;
(iii) the party against whom the arbitral award is invoked was not given proper notice of the appointment of an arbitrator or of the arbitral proceedings or was otherwise unable to present his case; or
(iv) the arbitral award deals with a dispute not contemplated by or not falling within the terms of the reference to arbitration, or it contains decisions on matters beyond the scope of the reference to arbitration, provided that if the decisions on matters referred to arbitration can be separated from those not so referred, that part of the arbitral award which contains decisions on matters referred to arbitration may be recognised and enforced; or
(v) the composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement of the parties or failing any agreement by the parties, was not in accordance with the law of the state where the arbitration took place; or
(vi) the arbitral award has not yet become binding on the parties or has been set aside or suspended by a Court of the state in which, or under the law of which, that arbitral award was made; or
(vii) the making of the arbitral award was induced or affected by fraud, bribery, corruption, or undue influence;
(b) if the High Court finds that—
(i) the subject matter of the dispute is not capable of settlement by arbitration under the law of Kenya; or
(ii) the recognition or enforcement of the arbitral award would be contrary to the public policy of Kenya.’’
16. In the instant case, the Respondent, being the person against whom it is invoked, has not furnished this court with any proof under Section 37 (1) (a) why the arbitral award should not be recognized. Further, this court has equally not found any reason to believe that the subject matter of the dispute is not capable of settlement by arbitration under the law of Kenya or that the recognition or enforcement of the arbitral award would be contrary to the public policy of Kenya.
17. In view of the foregoing, I note that the respondent did not oppose the application neither has the court found that there exists any of the grounds in Section 37 of the Arbitration Act to warrant the court’s rejection of the application to recognize and enforce the arbitral award.
18. Consequently, I find that the application dated 14th April 2024 is merited and I therefore allow it with costs to the Applicant.
19. It is so ordered.
SIGNED DATED and DELIVERED IN VIRTUAL COURT THIS
16TH DAY OF DECEMBER, 2024
ADO MOSES
JUDGE
In the presence of: -
C/A – Moses
…N/A………...for Applicant
……N./A……...for Respondent