Introduction and Background
1. Before the court is the application dated 9th May 2024, brought pursuant to Section 36 of the Arbitration Act and Rules 9 and 11 of the Arbitration Rules, 1997.
2. The application seeks an order for the recognition and enforcement of the arbitral award dated 16th October 2023 and the award on costs dated 9th February 2024, both issued by the sole arbitrator, Dr. Wayne Kenneth Mutuma, PhD, C.Arb. Additionally, the applicant prays that the court awards simple interest at the prevailing commercial bank lending rates and for an order for the respondent to reimburse the applicant the portion of the arbitration fees paid for by the applicant.
3. The application is supported by the affidavits dated 9th May 2024, 19th June 2024 and 26th July 2024. It is opposed by grounds of opposition dated 28th May 2024. There is no dispute that the arbitration proceedings pertain to a conflict between the two parties, and that a final award was issued on 16th October 2023. An award on costs was subsequently issued on 9th February 2024.
4. The applicant states that despite the award, the respondent had not made any payments, including the principal sum, interest, or arbitration fees. The applicant confirms that it had paid the respondent's arbitration fees, which remained unpaid by the respondent in order to secure the award. The applicant also asserts that no application to set aside the award had been filed within the statutory time frame, making the award enforceable. In light of this, the applicant sought to have the arbitral award and associated costs adopted as a judgment of the court, emphasizing that it was in the interest of justice for the orders sought to be granted, enabling the applicant to benefit from the award.
5. In its submissions, the applicant further stated that it had complied with the provisions of Section 36 and there being no challenge of the ruling the award should be adopted.
6. The respondent on the other hand argues that the application is not accompanied by an original or certified copy of the arbitral award, as required under Section 36(3)(a) of the Arbitration Act. Without complying with these mandatory provisions, the respondent asserts that the court cannot grant the relief sought by the applicant even as the applicant sought to regularize the illegality afterwards.
7. Further, the respondent claims that the supporting affidavit is incompetent and inadmissible, as it is not accompanied by a board resolution authorizing Amit Kumar Himmatsinghka to swear the affidavit on behalf of the applicant. The respondent also argues that the court has no jurisdiction to award interest as requested in the application, as this matter was already determined by the arbitrator in the final award dated 16th October 2023. The respondent states that the applicant did not request the tribunal for an additional award within the mandatory 30-day period set by Section 34(4) of the Arbitration Act. Finally, the respondent asserts that the court has no power to make an additional award as prayed, as doing so would amount to usurping the arbitral powers.
Analysis and Determination
8. I have carefully considered the pleadings before court and the submissions on record as well as the authorities cited. The main issue for determination is whether the applicant has met the threshold for recognition and adoption of the arbitral award.
9. Before I can get into the substance of the application, I shall deal with the issue raised that there is no board resolution authorizing Amit Kumar Himmatsinghka to swear the affidavit on behalf of the applicant Company. While this objection raises a procedural concern, it is not, in my view, fatal to the application. It is not disputed that the applicant Company was a party to the arbitration proceedings and that the final award was issued against the respondent.
10. The respondent participated in those proceedings and is therefore fully aware of the applicant's identity and involvement. In the circumstances, the deponent’s authority can reasonably be inferred from his role and the Company’s conduct. To insist on strict proof of a board resolution in this context and at this time would elevate form over substance, contrary to Article 159(2)(d) of the Constitution, which mandates courts to administer justice without undue regard to procedural technicalities. Accordingly, I find no merit in the objection and decline to strike out the application on that ground.
11. That said, the High Court, under Section 36 of the Arbitration Act, has the power to recognize and enforce a domestic arbitral award. The requirements are set out in Section 36(2) as follows:
(2) Unless the High Court otherwise orders, the party replying on an arbitral award or applying for its enforcement shall furnish—
(a)the duly authenticated original arbitral award or a duly certified copy of it; and
(b)the original arbitration agreement or a duly certified copy of it.
(3) If the arbitral award or arbitration agreement is not made in the English language, the party shall furnish a duly certified 'translation of it into the English language.
12. I am in agreement with the respondent that the requirements under Section 36(2) are mandatory as was also held by this court in Samura Engineering Limited vs Don-Wood Co Ltd [2014] eKLR. Upon perusal of the record, I note that while the applicant attached a certified copy of the arbitral award to its supporting affidavit, it initially failed to annex a certified copy of the arbitration agreement. However, this omission was rectified when the applicant filed a supplementary affidavit, sworn on 19th June 2024, which included the arbitration agreement.
13. In my view, no prejudice has been occasioned to the respondent by this rectification as the respondent was aware of the contract between the parties and the arbitration clause. This therefore renders the objection by the respondent moot. I am satisfied that the applicant has now fully complied with the requirements under Section 36 of the Arbitration Act.
14. With respect to the applicant’s request for simple interest on the arbitral award, I note that the arbitrator explicitly provided that simple interest would accrue on any outstanding amount after 90 days. The jurisdiction of this court under Section 36 is strictly confined to the recognition and enforcement of arbitral awards. Any further interference with the terms of the award is expressly limited by Section 10 of the Arbitration Act, which upholds the principle of minimal court intervention in arbitral proceedings. Since this Court cannot alter or add to the contents of the award, I am unable to grant that prayer.
15. With respect to the part of the arbitration fees that the applicant paid which was supposed to be paid by the respondent, I take the view that any claim for reimbursement of arbitration fees paid by one party on behalf of the other should ordinarily be addressed by the arbitral tribunal in its award as part of the award on costs. If the award did not order the respondent to reimburse arbitration fees, allowing such a request at the enforcement stage would amount to the court making a fresh award on costs and effectively re-writing the arbitral award. This would violate the principles of party autonomy and finality. I am of the opinion that any omission in the award could not be judicially corrected at the enforcement stage
16. In Rebecca Ndanu Munguti v. Acher Damond Morgan Ltd, the sole arbitrator expressly found that “the claimant has paid on behalf of the respondent Kshs 103,000/- [as] part of the arbitrator’s costs,” and directed that “the amount of Kshs 103,000 she paid shall be recoverable from the respondent by the claimant in addition to the claimant’s half share of costs.”
17. Likewise, in Kishan Construction Co. Ltd v. Pravin K. Patel & Another, the arbitral award explicitly dealt with this issue. The tribunal ordered that “the Arbitrator’s fees and disbursements were to be borne by the respondents,” and further “ordered [the respondents] to reimburse all arbitrator’s deposits of costs and disbursements paid by the claimant to the Tribunal within 14 days of demand,” with interest accruing for late payment
18. Based on the foregoing, I find that the application is partly meritorious. The applicant has complied with Section 36 of the Arbitration Act, and no valid challenge to the award has been raised. Instead, the respondent acknowledges the debt and the applicant has presented evidence that the respondent has been in communication with relevant government offices with an aim of providing for the same in its budget. The request for additional interest at commercial bank lending rates is declined, as the court has no jurisdiction to alter the award.
Disposition
19. Accordingly, the application dated 9th May 2024 is allowed in part to the extent that;
i. The Final Arbitral Award dated 16th October 2023 published by the sole arbitrator Honorable Dr. Wyne Kenneth Mutuma PhD, C.Arb in favor of the applicant for the sum of USD 8,333,877.00 and USD 1,188,014.00 being simple interest at the prevailing commercial bank lending rate as at 16th October 2023 be and is hereby adopted as a judgment of this Honorable Court capable of enforcement in execution.
ii. The prayer for an award of simple interest at the prevailing commercial bank lending rates on item 1 above until payment of the outstanding amount in full is declined for want of jurisdiction.
iii. The Arbitral Award on costs dated 9th February 2024 published by the sole arbitrator Honorable Dr. Wyne Kenneth Mutuma PhD, C.Arb in favor of the applicant for the sum of Kshs. 29,517,094.09 being the claimant's costs of the arbitral reference be and is hereby adopted as a judgment of this Honorable Court capable of enforcement in execution.
iv. The prayer for an order to the respondent to refund to the applicant the portion of the arbitration fees being the sum of Kshs.5,220,000/= inclusive of VAT is equally declined for want of jurisdiction.
v. The applicant shall have half the costs of the application
DATED, SIGNED AND DELIVERED IN MOMBASA
THIS 17th DAY OF APRIL 2025
F. MUGAMBI
JUDGE