The National Gas Company of Trinidad and Tobago Ltd v Super Industrial Services Ltd

• Jurisdiction: Trinidad & Tobago
• Judge: Madam Justice Eleanor Joye Donaldson-Honeywell
• Judgment Date: 07 December 2021
• Neutral Citation: TT 2021 HC 270
• Docket Number: Claim No. CV2019-05197
• Court: High Court (Trinidad and Tobago)

IN THE HIGH COURT OF JUSTICE

Port of Spain (Virtual Hearing)

Before

the Honourable Madam Justice Eleanor Joye Donaldson-Honeywell

Claim No. CV2019-05197

In The Matter of the Arbitration Act Chap 5:01

And

In The Matter of the UNCITRAL Arbitration Rules

In The Matter of the Decision of Ms. Shan Greer Sole Arbitrator

Between

The National Gas Company of Trinidad and Tobago Limited

Claimant

and

Super Industrial Services Limited

Defendant

Appearances

Deborah Peake SC, Jason Mootoo and Savitri Sookraj-Beharry, Attorneys-at-law for the Claimant

Dinesh Rambally, Kiel Taklalsingh and Stefan Ramkissoon, Attorneys-at-law for the Defendant

A. Introduction

1 This Judgment determines whether to set aside a preliminary decision made by an Arbitrator in proceedings concerning the Claimant's [“NGC”] contract as the Employer with the Defendant as the Contractor [“SIS”] for the sum of US$162,055,319.00. The contract, dated 10 March 2014, was to design and build the Beetham Water Recycling Plant (“the contract”). It was terminated by NGC effective 4 December 2015, having prior thereto issued notices claiming termination costs and other payments amounting to TT$8,470,036.02 plus US$59,166,774.57.

2 NGC based the quantum claimed on assessments by Mr. Danford Mapp. SIS disagreed with the assessments and eventually the parties referred the matter for arbitration.

3 The arbitration decision hereby addressed is an Award by Arbitrator Shan Greer delivered on 14 November 2019. NGC contends that she erred in law by ruling in favour of SIS that, based on her construction of clause 3.4 of the FIDIC General Conditions of Contract for Plant and Design Build Construction, 1 ^st edition 1999 (“the Conditions”) which forms part of the Contract, Mr Danford Mapp was not properly appointed, replacing the original Engineer under the Contract.

4 The Court's determination is that there is no error of law on the face of the Arbitrator's Award in her construction of the contractual terms governing the procedure NGC had to follow in replacing the Engineer. For reasons further explained in this Judgment, the part of the Award challenged by NGC will not be set aside.

B. Law and Guiding Principles

5 The Claimant's challenge to the Award is pursuant to Sections 19 (2) and 18 of the Arbitration Act Chapter 5:01 (“the Act”), as follows:

“19. … (2) Where an arbitrator or umpire has misconducted himself or the proceedings, or an arbitration or award has been improperly procured, the Court may set the award aside.”

“18. (1) In all cases of reference to arbitration the Court may from time to time remit the matters referred, or any of them, to the reconsideration of the arbitrators or umpire.…”

6 In addition to this statutory authority, the Court has inherent jurisdiction to set aside an arbitrator's award. In Educational Facilities Company Limited v Envirotec Limited CV 2018-04003 at paragraph 12, Mohammed J cited HCA 1541 of 2002 ICS (Grenada) Limited v NH International (Caribbean) Limited, as follows:

“Jamadar J (as he then was) succinctly summed up the basis of the Court's jurisdiction to set aside an award made by an Arbitrator at page 4 as:

”.the courts in Trinidad and Tobago have the power to set aside an award based on either a statutory and/or the inherent jurisdiction. Thus, under section 19(2) of the local Act [see, section 11(2) of the 1889 UK Act and section 15 of the 1934 UK Act] the court has a statutory jurisdiction to set aside an award where an arbitrator has misconducted himself or the proceedings or where an arbitration or award has been improperly procured.

However, the court also has an inherent jurisdiction to set aside an award which was:

• i. subject to an error on the face of the award;

• ii. wholly or in part in excess of jurisdiction; or

• iii. subject to a patent substantive defect.”

7 The approach of the Court to the question of setting aside an arbitrator's award was considered by the Judicial Committee in NH International (Caribbean) Limited v NIPDEC [2015] UKPC 37 at paragraph 29, as follows:

“Where parties choose to resolve their disputes through the medium of arbitration, it has long been well established that the courts should respect their choice and properly recognise that the arbitrator's findings of fact, assessments of evidence and formations of judgment should be respected, unless they can be shown to be unsupportable. In particular, the mere fact that a judge takes a different view, even one that is strongly held, from the arbitrator on such an issue is simply no basis for setting aside or varying the award. Of course, different considerations apply when it comes to issues of law, where courts are often more ready, in some jurisdictions much more ready, to step in.” [Emphasis added]

8 In Civ app 281 of 2008 National Insurance Property Development Company Limited v NH International Limited, Bereaux JA's Judgment addressed the problem that there would be no finality in matters intended to be decided by arbitration if the very matters referred as points of construction could be set aside by a Court after being determined by an Arbitrator. This had to be balanced against “the high principle which demands justice though the heavens fall”. 1

9 At paragraph 40 of the Judgment, Bereaux JA cited Kelantan Government v. Duff Development Co. [1923] A.C. 395. There, at pg. 417 Lord Parmour, said:

“Where a question of law has not specifically been referred to an umpire, but is material in the decision of matters which have been referred to him, and he makes a mistake, apparent on the face of the award, an award can be set aside on the ground that it contains an error of law apparent on the face of the award”

10 Bereaux JA further cited Viscount Cave who, at pg. 410, underscored:

“…In re King and Duveen (6) Channell J. stated the rule concisely as follows: “It is no doubt a well-established principle of law that if a mistake of law appears on the face of the award of an arbitrator, that makes the award bad, and it can be set aside …., but it is equally clear that if a specific question of law is submitted to an arbitrator for his decision, and he does

decide it, the fact that the decision is erroneous does not make the award bad on its face so as to permit of its being set aside. Otherwise it would be futile ever to submit a question of law to an arbitrator .” [Emphasis added]

11 In the instant case, NGC's challenge concerns one aspect of a preliminary Award and not the substantive claim specifically referred for arbitration by NGC. However, the challenge is material in the decision of the substantive matter so referred. As such, the very restricted approach suggested in Kelantan is not applicable. If there is an error on the face of the record, in the Arbitrator's construction of contract terms relevant to this preliminary point, the Court can readily set that part of the Award aside.

12 There is no dispute between the parties as to the fact that the determination of NGC's claim turns on whether the Arbitrator correctly construed the contract, with particular focus on clauses 3.4 and 1.1.2.4 of the Conditions. The Arbitrator cited the decision of Lord Hodge in the UK Supreme Court case of Wood v Capita Insurance Services Ltd [2017] 4 All ER 615 as to the approach a court should take in the interpretation of written contracts.

13 The parties agree that the guidance provided in Wood for courts was also applicable to the Arbitrator's construction of the contract. The guidance was as follows:

“[10] The court's task is to ascertain the objective meaning of the language which the parties have chosen to express their agreement. It has long been accepted that this is not a literalist exercise focused solely on a parsing of the wording of the particular clause but that the court must consider the contract as a whole and, depending on the nature, formality and quality of drafting of the contract, give more or less weight to elements of the wider context in reaching its view as to that objective meaning…

[11] … Interpretation is, as Lord Clarke stated in Rainy Sky (para [21]), a unitary exercise; where there are rival meanings, the court can give weight to the implications of rival constructions by reaching a view as to which construction is more consistent with business common sense…

[12] This unitary exercise involves an iterative process by which each suggested interpretation is checked against the provisions of the contract and its commercial consequences are investigated” [Emphasis added]

14 In addition to the foregoing, NGC cites Tullow Uganda Ltd v Heritage Oil and Gas Ltd [2014] EWCA Civ 1048. NGC submits that for the Arbitrator's construction of Clause 3.4 as mandating 42-day notice to the Contractor as a condition precedent to replacement of the Engineer to be correct in law, clear...