' FAKHRUDDIN G. EBRAHIM, J-This High Court Appeal is directed against an order made by or learned brother Zaffar Hussain Mirza, J., ,rejecting the appellants/plaintiffs application under section 20 of the Arbitration Act seeking an order for filing the alleged arbitration agreement and for reference of the disputes between the parties to arbitration.
2. The plaintiffs/appellants had sought to refer to arbitration two sets of disputes, one relating to a written contract for construction of a canton, and the other, which was allegedly oral, for construction of F. S. F. Quarters. In both cases reliance was placed on clause 46 of the written contract which reads as follows:- "Except where otherwise provided in the contract all questions and disputes relating to the meaning of the specifications, designs, drawings and instructions herein mentioned and as to the quality of workmanship, or materials used on the works or as to any other question claim, right, matter or thing whatsoever in any way arising or relating to the contract, designs, drawings, specifications, estimate, instructions, orders or the conditions or otherwise concerning the works or the execution, or failure to execute the same, whether arising during the progress of the work or after the completion or abandonment thereof shall be referred to the Chairman, Punjab Industrial Development Board, who shall be final authority and whose decision shall be final and binding and cannot be challenged in the Court of law or by any arbitration."
3. The learned Single Judge relying on the well-settled rule that an arbitration agreement is essentially a contract and in the matter of interpretation is to be governed by the same rules that apply to the construction of contracts, and that a contract is to be construed in harmonious manner and each part of the contract is to be construed in harmony with the other parts, so that a rational meaning is given to all the parts of the contract, found that the following words in the said clause 46 cannot be ignored: ' who shall be final authority and whose decision shall be final and binding and cannot be challenged in the Court of Law or by arbitration." ' and concluded that there was no escape from the conclusion that the parties had expressly provided that the disputes once decided in the manner provided in clause 46 shall not be referred to arbitration and, therefore, to attribute an intention to the parties that the Chairman, Punjab industrial Development Board was to act as an arbitrator would be contrary to the express language of the clause for that there cannot be an arbitration upon an award once made by an arbitrator. The learned Judge then went on to say that on the other hand it was possible to give meaning to the aforesaid clause if the Chairman, Punjab Industrial Development Board is construed to be a referee and not an arbitrator which seemed to the learned Judge to be true intent behind the provision.
4. Mr. S. E. Hussaini, the learned counsel for the appellant by a reference to several decisions from or own as well as Indian Jurisdiction Mst. Akbari Begum v. Rehmat Hussain and others (1), Udit Singh and others v. Ram Lakhan Singh and 8 others (2), Lakshmi Narain v. Ram Babu and another (3), Muhammad Akram and others v. Ch. Muhammad Salim (4), Ch. Muhammad Saleem v.
Muhammad. Akram and others (5) and All Hussain v. Rafiquddin and 9 others (6), pointed out that a referee is such a person who acts on his own knowledge and belief and is not a person who is appointed to decide the matter after enquiry and after taking evidence. The learned counsel went on to argue that it is not only not the case of the parties that Chairman, Punjab Industrial Development Board had the knowledge of the contract between the parties but that is further clear from the fact that the arbitrator was named by reference to his office. It was, therefore, obvious that the Chairman, Punjab Industrial Development Board was not a referee or a mediator but an arbitrator.
' The question in the present case, however, is not whether the chairman, Punjab Industrial Development Board was to act as a referee or a mediator but whether the clause in question was an unambiguous unequivocal arbitration clank. Mr. Hussaini conceded that the last few words in the clause, " decision cannot be challenged by any arbitration", do create a doubt for there would be no question of challenging an award made by the Chairman, Punjab Industrial Development Board in an arbitration but contended that these words were repugnant to, or made redundant the earlier part of the clause which in clear terms provides for resolving the dispute between the parties through arbitration of the Chairman, Punjab Industrial Development Board. The learned counsel invited or attention to the recognised rule of interpretation relating to documents for if in a deed an earlier clause is followed by a later clause which destroys altogether the obligation created by the earlier clause, the later clause was to be rejected as repugnant and the earlier clause will prevail.
7. Mr. Kamal Azfar, the learned counsel for the respondent contended that the said clause was admittedly ambiguous and it would appear that parties were not ad idem and in these circumstances the learned Judge cannot be said to be wrong in the exercise of his discretion that there was 'not sufficient cause for compelling the parties to go to arbitration. The arbitration clause has of necessity to be strictly construed for they purport to oust the jurisdiction of Courts and if there is doubt or difficulty parties should be left free to pursue their remedy elsewhere. In this view of the matter {{FOOT NOTE}}
(1) AIR 1933 All. 861 (2) AIR 1933 All, 313
(3) AIR 1953 All. 9 (4) PLD 1963 Lah. 490,
(5) PLD 1971 SC 516 (6) PLD 1977 Lab. 418 {{FOOT NOTE}} ' the better course would be that a clause, capable of more than one meaning, ought not to be construed as an arbitration clause.
7. There is yet another difficulty in the way of the appellants, even if it is assumed that the said clause 46 was an arbitration clause, and that is, its vagueness. The clause does not make it clear as to whether the intention of the parties was to refer the dispute to arbitration of the officer holding the post of the Chairman, Punjab Industrial Development Board at the time the contract was concluded or at the time when the dispute arose or at the time of actual reference which in my humble view involves an uncertainty which vitiates the arbitration clause.
8. In view of this conclusion it is unnecessary to examine the other contention of Mr. Kamal Azfar that in relation to F. S. F. Quarters there was in fact no agreement between the parties, much less a written agreement.
9. This appeal is, therefore, dismissed with costs.