Pakistan Case Law← Search
2007 CLD 661

Messrs PACIFIC LLOYDS LTD. through duly Constituted Attorney vs Messrs

Citation2007 CLD 661
CourtSindh High Court
Judge(s)Gulzar Ahmed
ResultN/A

1. GULZAR AHMED, J.---This is an application under sections 4, 5 and 6 of the Arbitration (Protocol and Convention) Act, 1937 (hereinafter called the Act) for enforcement of a foreign award. The defendant has filed objections to the award. . The facts are that the plaintiff and the defendant entered into a Charter Party Agreement dated 2-12-2002 for shipment of 13,000 MT of bagged rice from the Port of Karachi for the discharge Port at Madagascar intention Tamatave per vessel MV Maria R or sub. It appears that the vessel IR An Meezan was substituted. The carriage was undertaken whereupon dispute arose between the parties leading to the plaintiff making a claim against the defendant. The arbitration clause in the Charter Party was invoked and the plaintiff appointed Mr. William Packard as its arbitrator while the defendant appointed Mr. S.A.H. Bilgrami as its arbitrator at London. The defendants filed its reply statement. The two arbitrators did not agree on the merits of the award pursuant to which the matter was referred to Mr. John Schofield as Umpire who gave final award dated 2-12-2002 in favour of the plaintiff. The award is filed as annexure 'M' to the plaint.

2. Mr. Shaiq Usmani learned counsel appearing for the defendant has contended that the Arbitration Tribunal was not constituted in accordance with the arbitration clause in the Charter Party and thus the award is not in accordance with law. He has further contended that the award is shorn of reasons and does not deal with all questions/objections raised by the defendant and is based upon biasness of the umpire and is not final and thus not enforceable. On the other hand Mr. Yousaf Moulvi, learned counsel for the plaintiff has contended that the scope of objections is very limited and that the Arbitration. Tribunal was validly constituted, reasons have been given and it deals with all the questions that were raised and that biasness is not a ground on which the award can be assailed and the award is final. In support of his submission he has relied upon the cases of Gesellschaft Burgerlichen Pechts and others v. Stockholms Rederiaktiebolag Svea (1966) 2 WLR 909; Conticotton S.A. Co. v. Farooq Corporation 1999 CLC 1018; A. Merdith Janes Co. Ltd. v. Crescent Board Ltd. 1999 CLC 437; Nan Fung Textiles Ltd. v. Saddiq Traders Ltd. PLD 1982 Kar. 619 and Quinn Corporation and others v. Cotton Export Corporation of Pakistan (Pvt.) Ltd. And others 2004 CLD 1040.

3. The learned counsel for the defendant in elaborating his submission has stated that the Arbitration Tribuhal was not in accordance with the Clause 19(a) of the Charter Party, which was an agreed clause for arbitration between the parties. The case of the defendant on the other hand is that the clause 62 of the Charter Party applied for the purpose of arbitration and that the award is given by the Arbitration Tribunal in accordance with the said clause. Clause (b) of subsection (1) of section 7 of the Act provides that in order that a foreign award may be enforceable under this Act it must have been made by the Tribunal provided for in the agreement or is constituted in manner agreed upon by the parties. I have gone through the Charter Party which is filed as annexure 'A'. Box 25 of the Charter Party is relevant as it deals with Law and Arbitration. It provides for filling of this box by stating as to which of the printed clause will apply and it also provides that if not filled in clause 19(a) shall apply. The box has been filled up with the word 'English' and by this the defendant's counsel states that clause 19(a) will apply in respect of Law and Arbitration. Apart from printed form there are attached typed written, stamped on and signed additional clauses to the Charter Party, clause 62 of which is as follows:- "62. Any dispute arising under this Charter is to be referred to arbitration in London and decided under the Law of England one arbitrator to be nominated by owners and the other by Charterers and in case the arbitrators shall not agree, then to the decision of an umpire to be appointed by them. The award of the arbitrators or the umpire to be final and binding upon both parties."

4. The distinction between the two arbitration clauses one in the printed form that of 19(a) and in 62 is that the earlier one provides for constitution of the Arbitration Tribunal of three arbitrators that is one to be appointed by each of the parties and the arbitrators so appointed shall appoint a third arbitrator and the decision of the three men tribunal or any two of them thus shall be final.

5. Whereas the latter clause requires appointment of two arbitrators one by each party and appointment of an umpire by the two arbitrators in case, they shall not agree, in which event the decision of the Umpire to be final. The question is as to which of the clause relating to the Law and Arbitration in the Charter Party will have application. As stated above, Box 25 is filled up only with the word 'English'. So in the first place, it is not the case that the box is not filled in. However, writing of this word alone does not fulfil the requirement of this box as it has to specify among the various clauses in the printed form of Charter Party. None of the printed clauses is specified in this box. The rules of construction of the Charter Party have been commented upon by Scrutton on Charter Parties and Bills of Lading 9th Edition wherein at 'page 20 the author has made the following commentary:- "Question of mistake in the expression of intention frequently arise in the case of Charters effected by filling in printed forms, where parts of the printed form, left in by inadvertence, are in direct contradiction to clause written, stamped on or typed in the form; in these cases the written, stamped on or typed clause should and usually prevail, as clearly expressing the intention of the parties."

6. On this interpretation of the clause of Charter Party, one may safely say that the clause which is written, stamped on or typed in the form will prevail as expressing the intention of,the parties. As stated above clause 62 of the Charter Party is written, stamped on or typed in the form which is in direct contradiction to the printed clause 19(a) of the Charter Party and thus will prevail to be expressing the intention of the parties. To me also the written, stamped on or typed clause 62 in Charter Party which expressly deals with the matter of Law and Arbitration will prevail in view of its contradiction with the printed form in the Charter Party, for the reason that had the C parties agreed to the clauses provided in the printed form, there was no need for them to provide for the same in the latter clause 62 which on basic rule of interpretation of document will have application. The learned counsel for the defendant has further argued that third arbitrator or the umpire ought to have been appointed before entering upon reference. In this regard he has referred to paragraphs 16 and 21 of Guide to the Arbitration Act 1996 Richard Lord and Simon Salzedo. It may be noted that clause 62 of the Charter Party in very clear terms provides for appointment of the umpire by the arbitrators in case they shall not agree. Paragraph 16(1) of the Guide to the Arbitration Act 1996 provides that the parties are free to agree on the procedure for appointing the arbitrator or arbitrators including the procedure for appointing any Chairman or Umpire. Clause (2) of this paragraph provides that if or to the extent there is no such agreement, the provisions laid down onward will apply. In the case in hand as stated above clause 62 provides for procedure for appointing the arbitrators and also procedure for appointing of an umpire which is when the arbitrators do not agree and the arbitrators have followed this in appointing the umpire. The next argument advanced by the learned counsel for the defendant that the award is not reasoned and in this respect has referred to section 54 of the English Arbitration Act 1996 and section 7(e) of the 'Act. The learned counsel for the plaintiff on the other hand has stated that the award contains reasons. The perusal of the award shows that the Umpire has given reasons for the final arbitration award. The Umpire has dealt with the points that were apparently raised before him and has given reasons for. His conclusion with reference to the record filed before him. The reasons itself comprise of 20 pages. The only thing that seems to be agitating the defendant is, that in the initial paragraph of the reasons it is mentioned that the reasons do not form part of the award to which they relate and are issued solely for the guidance and information of the parties and by this it was canvassed that these are not the reasons for the award. I do not find myself in agreement with such submission inasmuch as it is apparent that the award is in two documents, one document being final arbitration award which does not contain reasons and the other document is the reasons for the final arbitration award. Obviously the reasons are not part of the award but have been separately given for the award. This will not mean that these reasons are not for the final arbitration award. The next point that was argued by the learned counsel for the defendant was that the award does not deal with all questions and thus does not comply with the clause (c) subsection (2) of section-7 of the Act. He has stated that the defendant's objection as to the locus standi of MM Marine Services (Pvt.) Ltd. To file claim is not decided by the umpire and referred to annexure A/2 and 'B' to the objections. It appears that the Charter Party was made between Pacific Lloyds Ltd. As owners and Blessed Enterprises Karachi as Charterers. On behalf of the owners, Charter Party was signed by MM Marine Services (Pvt.) Ltd. As agents. The agents appear to have lodged the claim but the award shows the name of the claimant to be Pacific Lloyds Ltd. Of Malta. The award therefore, is in favour of the owners itself and not in favour of the agents. The umpire has dealt with this very question in his reasons in paragraphs 4, 5, 6, 7, 8, 9 and 10 and has come to the conclusion that the submissions put forwarded by MM Marine Services (Pvt.) Ltd. Were made on behalf of Pacific Lloyds Ltd. And not on their own behalf and that they are entitled to represent Pacific Lloyds. This is the finding of fact given by the umpire to which no exception can be taken by way of an objection to an award. No other instance was quoted by the learned counsel for the defendant to substantiate that the award does not deal with all questions.

7. The next point raised by the learned counsel for the defendant was that the umpire was bias. This argument has been advanced for the reason that the claimant's arbitrator in his letter dated 16-5- 2003 filed as annexure C-3 to the objections has used the word 'leeway'. It may be noted in the first place that biasness is not the ground provided for the nonenforcement of the award under the Act.

8. In any case, if the arbitrator has used the word leeway for providing sometime to the claimant, learned counsel has not stated as to what prejudice by it has been caused to the defendant. The award is not given by claimant's arbitrator but by umpire and no such objection is raised for him.

9. The final submission of the learned counsel for the defendant was that the award is not final. To support of his submission, he has referred to a specimen certificate filed with statement dated 3-11-2006. It may be true that a certificate similar to the one as is mentioned in the specimen could have been obtained by the plaintiff from the Master of the Supreme Court of England and Wales in terms of section 58 of the Arbitration Act 1996 but before me it was not stated by the learned counsel that the award of the umpire is under challenge by way of an appeal or that it otherwise is not final.

10. Merely because certificate as is referred to has not been obtained will not rob the award Of its finality and even otherwise the provision of clause (d) of subsection (1) of section 7 of the Act only requires that the award must have become final in the country in which it was made which fact is not in dispute. After considering all the aspects of the matter, I am of the considered view that the objections have no force and the same are rejected and the award is made rule of the Court.

11. Award made rule of the Court.

For educational and research use only — not legal advice. Verify against the official report before relying on it. See our Disclaimer.
Disclaimer·Privacy·Terms·Search