AJMAL MIAN, J.--(1) This appeal is directed against an order dated 26-5-1985, passed by a learned Single Judge of this Court in Suit No. 258 of 1981 declining the present appellant's application under section 20 of the Arbitration Act, (hereinafter referred to as the Act), which was registered as a suit. t 2. The brief facts leading to the filing of the above appeal are that the appellant entered into an agreement dated 26-10-1977 (hereinafter referred to as the Agreement) with the respondent for carrying out certain civil work. It seems that during the execution of the work, the appellant was paid four running bills. He was also paid the fifth and final running hill. However, it is the case of the appellant that the above fifth final bill does not cover all the dues of the appellant. He, therefore, after serving notices filed the above application under section 20 of the Act. The above application was resisted by the respondent inter alia on the ground that there was no dispute and that the arbitration clause did not cover the alleged dispute. The learned Single Judge after hearing the parties and after referring to the case-law concluded in the order under appeal that clause 68 of the Agreement does not cover the dispute in respect of payment of final bill. The appellant being aggrieved by the above order has filed the present appeal.
3. In support of the above appeal Syed Himayat All Pirzada, learned counsel for the appellant has urged that clause 68 of the Agreement covers all kinds of disputes of whatsoever nature and, therefore, the order under appeal is not in consonance with the above clause.
On the other hand Mr. Arif Hussain, learned counsel for the respondent has contended as follows:- (i)that the clause in question is not an arbitration clause, (ii)that there is no dispute referable to the arbitration and that in any case the dispute in question is not covered by the arbitration clause; and
(iii) the above dispute is not covered by above clause 68.
4. In order to appreciate the respective contentions of the learned counsel for the parties, it may be pertinent to reproduce clause 68 of the Agreement, which reads as follows:- "68. SETTLEMENT OF DISPUTES: If any dispute or difference of any kind whatsoever shall arise between the Employer or the Engineer and the ConV3ctor in connection with or arising out of the contract or the carrying out of the works (whether during the progress of the works or after their completion and whether before or after the termination, abandonment or breach of the contract) it shall be referred to and settled by the Engineer who within a period of 90 days after being requested by either party to do so shall give written notice of his decision to the Employer and the Contractor. Save as hereinafter provided such decision in respect of every matter so referred shall be final and binding upon the Employer and the Contractor until the completion of the work and shall forthwith be given effect to by the Contractor who shall proceed with the works with all due diligence."
A perusal of the above clause indicates that any dispute or difference of any kind whatsoever if arises between the Employer or the, Engineer and the contractor in connection with or arising out of the contract or the carrying out of the works (whether during the progress of the works or after their completion and whether before or after the termination, abandonment or breach of the contract), it is to be referred to and settled by the Engineer who is required to give his decision within 90 days.
It further provided that save as provided earlier in the above clause, the decision in respect of every matter so referred shall be final and binding upon the Employer and the Contractor until the completion of the work. It further contemplates that such a decision shall be given effect to forthwith by the Contractor, who shall proceed with the work with all due diligence.
5. We are unable to agree with the learned Single Judge on the conclusion that any dispute relating to the payment of dues is not covered by the above--quoted clause 08 as the words employed in the above clause, namely, "any dispute or difference of any kind whatsoever' are wide enough to cover even a dispute relating to the demand of the Contractor for further payment of the work executed by him. However, we are inclined to maintain the order under appeal for the reason that the above clause contemplates that the decision of the Engineer shall be binding upon the parties until the completion of the work. This portion of the above clause makes the clause vague on the question as to whether factually it is an arbitration clause or it was intended only to provide for a decision which may remain binding on the parties till the completion of the work in order to avert the delay in completion of the work. The learned Single Judge has referred inter alia, to the case of Board of Trustees of Port of Karachi v. Messrs National Construction Company and another reported in PLD 1981 Kar. 377, which contained an identical clause with the variations that it provided that the decision of the Engineer shall be binding upon the Contractor until the completion of the work and, secondly sub-para. 2 contained express arbitration after a decision by the Engineer. The above-reported case lends support to the conclusion which we are inclined to take. In the absence of the second para. Providing arbitration the instant clause 68 in the agreement seems to be vague and, therefore, we are not inclined to grant the above appeal on the above ground. The order of the learned Single Judge under appeal is therefore maintained.
The appeal is dismissed but there will be no order as to costs. revisions by the competent authorities. Therefore, it is advisable to consult the official sources or legal professionals for the most up-to-date and accurate information.