IN THE HIGH COURT OF FIJI AT LAUTOKA
CIVIL JURISDICTION
(WESTERN DIVISION)

Civil Action No. 61 of 2013

BETWEEN:

ROTOMOULD (FIJI) LIMITED of Aliz Pacific, 8th Floor, BSP Life Centre, 3 Scott Street, Suva, in the Republic of Fiji.
PLAINTIFF

AND:

DEO CONSTRUCTION DEVELOPMENT CO. LIMITED of 11 Industrial sub division, Denarau Island, Nadi, in the Republic of Fiji.
DEFENDANT

RULING

Counsel : Ms B. Narayan for the Plaintiff
 : Mr. A.K. Narayan (Jr) for the Defendant

PRELIMIARY ISSUE

1.	Rotomould is seeking to set aside an arbitral award in favour of Deo Construction Development Co. Limited(“DCDCL”). At the hearing of the matter, a preliminary objection to the application was raised by Mr. AK Narayan (Jr.). He objected on the ground that the application before me was filed too late and should therefore be struck out.

2.	The Originating Summons to set aside the award was filed on 12 April 2013 pursuant to Order 73 Rule 3 of the High Court Rules 1988. The award had been handed down on 20 February 2013.
3.	Order 73 Rule 3 provides:

3.-(1) An application to the Court-

(a) to remit an award under section 11(1) of the Arbitration Act, or

(b) to set aside an award under section 12(2) of that Act or otherwise, 

must be made, and the summons or notice must be served within 21 days after the award has been made and published to the parties

4.	Clearly, the Originating Summons in this case was filed well outside the 21 days period stipulated by Order 73(3)(1)(b). Mr. Narayan argues that the time limit stipulated under Order 73 Rule 3(1) is mandatory. He emphasises that Order 73 makes no provision for abridgement of time.

5.	I start with the salient point that, throughout the common law world, an arbitral award is given a certain measure of sanctity (see discussion later on in this ruling). This does not mean that an award cannot be impugned. Rather, it means that it will normally be hard to disturb an arbitral award. Perhaps that explains the rigidity in the tone of Order 73(3)(1)(b). However, there is, yet, a discretion to extend time vested in this Court. This discretion is conferred by Order 3 Rule 4 of the High Court Rules 1988. 

6.	Russell On Arbitration(19th ed.)(1979), in his analysis of the English Arbitration Act 1950 confirms as follows at page 496:

An application to set aside or remit an award may be made at any time within six weeks after the award is made and published to the parties (citing the English Order 73 Rule 5). But this time may be extended (under the English Order 3 Rule 5).

7.	The same applies in Fiji by application of our corresponding Orders and Rules. Fiji’s Order 3 Rule 4 sub-rules (1),(2) and (3) read:

Extension, etc., of time (O.3, r.4)

4.-(1) The Court may, on such terms as it thinks just, by order extend or abridge the period within which a person is required or authorised by these rules, or by any judgment, order or direction, to do any act in any proceedings.

(2) The Court may extend any such period as is referred to in paragraph (1) although the application for extension is not made until after the expiration of that period.

(3) The period within which a person is required by these Rules, or by any order or direction to serve, file or amend any pleading or other document may be extended by consent (given in writing) without an order of the Court being made for that purpose.

8.	In the exercise of the discretion conferred under Order 3 Rule 4, the court must take into account such factors as the length of the delay, the reasons for it, the prejudice if any that would be done to the other parties if the application were permitted to proceed, and the merits of the applicant's case. 

9.	In Invercargill City Corporation v. Dick, Henry J of the New Zealand Supreme Court was asked to consider whether or not the delay in moving to set aside an arbitral award was reasonable or not. Notably, the New Zealand Arbitration Act which was then in force fixed no time limit for the making of such an application. Held (as per headnotes):

A discretion as to time such as that which has been applied in reference to ss.11 and 12 of the Arbitration Act 1908 should not be confined to grounds which were either accepted or rejected in previous cases. Such cases may be considered as giving a general indication of the practice of the Courts, and to that extent are persuasive but not binding precedents.

Where there has been delay in moving to set aside an award, prejudice suffered by the other party may be considered as a factor in determining whether or not the delay is reasonable or unreasonable.

Where an award is manifestly unjust and wrong, the Court should not refuse to set it aside on the sole ground that there was delay in making the application.

10.	In Ishmail v Polish Ocean Lines, notwithstanding an oversight on the part of the lawyers in filing on time, an extension was allowed as no perceivable prejudice would be done to the opposing party.

11.	In the case before me, I exercise my discretion under Order 3 Rule 4 in favour of extending the time. In doing so, I am influenced by the fact that (i)the award in question was made some twelve months after the appointment of the arbitrator and (ii) one of the grounds on which Rotomould seeks to impugn the award is the very fact that it was handed down so late (further discussion below). Suffice it to say here at this time that clause 3 of the First Schedule to the Arbitration Act (Cap 38) stipulates that an Arbitrator:

 “...shall make their award in writing within three months after entering on the reference, or after having been called on to act by notice in writing from any party to the submission, or on or before any later day to which the arbitrators, by any writing signed by them, may, from time to time, extend the time for making the award”.

INTRODUCTION

12.	The question is whether or not I should set aside the award of a certain Arbitrator. Section 12(2) of Fiji’s Arbitration Act (Cap 38) gives me power to set aside an arbitral award on two specific grounds. Yet, other provisions of the Act appear to give some measure of sanctity to the arbitral process and award. Section 3 for example, provides that a submission is irrevocable except by leave of the court or by mutual consent. And clause 8 of the First Schedule to the Act states that an award is final and binding on the parties.

13.	There are two competing philosophies involved here. The first, perhaps a spin-off of the laissez -faire and freedom-of-contract tradition, sees arbitration purely in terms of the parties’ agreement. Proponents argue that courts should not interfere with any arbitral process or award because the parties’ have, out of their own volition, agreed to submit to arbitration, have handpicked the arbitrator, and, by their very agreement, conferred jurisdiction (and its scope) to the Arbitrator. Accordingly, the parties are taken to accept, expressly or impliedly, the finality of the arbitrator’s award.

14.	It is also often mooted that the public has an interest in ensuring the finality of arbitral awards (e.g. the Singaporean High Court in TMM Division Maritima SA de CV v Pacific Richfield Marine Pte Ltd ).InSoh Beng Tee & Co Pte Ltd v Fairmount Development Pte Ltdthe Singaporean Court of Appeal said that for arbitration to work as an ADR, it must have autonomy. Accordingly, its awards must be recognised as being final and parties must accept a very limited recourse to the courts and that, on the rare occasion that the court will intervene, it will do so not as an appellate court.

15.	The second view argues that the court may interfere in the arbitral process or with an award in the name of public policy. Proponents argue that public interest demands that every arbitration process operates according to acceptable standards of natural justice and uniformity. Hence, the state, through the courts, may interfere if only, to ensure that these standards are adhered to.

16.	Both theories are relevant. But where to draw the line is a vexed question. The New Zealand Law Commission summarises the dilemma thus:

Arbitration law concerns a critical balance: .. to be struck between the autonomy of the parties and the law of the land. On the one side .. is the agreement of the parties. The parties to a contract or to a dispute agree that their disputes are to be resolved by a tribunal which they establish themselves or to which they agree. The tribunal is to follow a procedure on which the parties may agree, and is to apply the law which they may state. The parties also, in general, pay for the arbitration. That is to say, the whole process rests on the parties' consent and is their creation. But not quite. For on the other side .. is the significant weight of the general law of the land. The very agreement that sets up the tribunal is an agreement under some system of law. It is national law, with national courts, which can be used to require a reluctant party to submit to arbitration, and to enforce any resulting award. The law may state the procedure to be followed. The law might, as well, also be used to control the arbitrator. To what extent should the courts, enforcing their perception of the law and of procedural fairness, be free to override the decision of the arbitral tribunal and to upset the conclusions reached through that consensual process? To what extent should judicial supervision be able to undermine the advantages of informality, privacy, expedition, expertise and cost which arise from the agreement? And what matters cannot be made the subject of arbitration, that is of the parties' private ordering?

17.	Successive legislative reforms in England, Australia and New Zealand over the years attest (perhaps) to the fact that the quest for that ideal balance between contractual autonomy and state intervention is an ongoing one. In some jurisdictions, there has been a progress towards lesser court “intervention”. 

BACKGROUND

18.	The background to this matter is reported in paclii in an earlier ruling I had given (Rotomould (Fiji) Ltd v Deo Construction Development Co Ltd[2014] FJHC 245; Civil Action 61.2013 (10 April 2014).In 2011, Rotomould accepted the tender of DCDCL as contractor to construct a commercial building and warehouse just on the outskirts of the municipality of Lautoka. The parties purportedly terminated their agreement mutually when work was not progressing according to the agreed schedule. I say “purportedly” because, one of the issues that arose before me is whether in fact the mutual termination was effective.

19.	Under their contract, DCDCL was to carry out and complete the work in 26 weeks from03January, 2011 to04 July, 2011. These dates were critical to Rotomould. After the termination of their contract, some issues of compensation arose. The parties could not resolve their differences on these. They then resorted to arbitration (see Appendix 1 for a full chronology of all communication leading up to termination of the agreement and subsequently, arbitration). The Arbitrator appointed was a Mr. Fraser Clark. Both parties made submissions to Mr. Clark, who, I understand, is a highly qualified and experienced Architect in Fiji. Almost a year after Clark’s appointment, he handed down an award.

20.	The main difference between Rotomould and DCDCL was: which party had breached the agreement? Rotomould would argue that time was of the essence in the agreement, which, DCDCL breached through its delay. That delay gave it a right to determine the agreement. 

21.	DCDCL on the other hand, cites the following reasons for the delay.

(i)	spate of bad weather around the agreed time for commencement of construction

(ii)	subdivision plan not approved.

(iii)	survey plan not done.

(iv)	stop work order by Lautoka Rural Local Authority

(v)	building plans not approved.

(vi)	increase in price of building materials and fuel.

22.	Rotomould would say that, other than the spate of unfavourable weather, the other excuses DCDCL gives for the delay were unreasonable or were outright lies. When the parties could not resolve their differences, Rotomould then wrote to DCDCL on 23 May 2011 terminating their agreement (see Appendix 1for the full chronology and Appendix 3 for an extract of the award).

ROTOMOULD’S ORIGINATING SUMMONS

23.	Rotomould desires to have the award set aside and/or for this Court to determine the correct amount to be remunerated to DCDCL for work it carried out. Its Originating Summonsalso seeks a declaration that the Arbitrator misconducted himself and/or improperly procured the award. It alleges that the Arbitrator:

(i)	failed to properly consider all evidence presented by the plaintiff.

(ii)	failed to accept any verbal argument from both the plaintiff and the defendant when both parties insisted on the same.

(iii)	failed to consider that there was no “Stop Work Notice” issued by the Lautoka Rural Authority at any point prior to or during the duration of the contract period.

(iv)	failed to order the transfer of all materials offsite and onsite to the plaintiff or give credit to the plaintiff for the said materials.

(v)	went beyond his powers by inter-alia awarding loss of profit to the defendant pursuant to a breach of contract without any evidence of loss of profit provided by the defendant nor this being an issue to be determined, the contract being mutually terminated.

(vi)	took into account irrelevant considerations and made errors in law.

(vii)	delayed unnecessarily in handing down the award and refused to obtain terms of reference.

24.	The affidavits of one Prakash Chandand of one Sanjay Patel are filed in support of the Originating Summons. Vimal Deo, a director of DCDCL, has sworn an affidavit in opposition. Presently, there is a stay on the enforcement of the award and an injunction restraining a threatened winding up petition. These were ordered after Rotomould paid the award sum into Court.

ISSUES

25.	This court has a discretion under section 12(2) of the Arbitration Act to set aside an award if the Arbitrator has, either misconducted himself, or, if he has improperly procured the award. 

Power to set aside award

12.-(2) Where an arbitrator or umpire has misconducted himself, or an arbitration or award has been improperly procured, the court may set the award aside.

26.	The term “misconduct” does not mean moral turpitude on the part of the Arbitrator. Rather, it means lack of procedural fairness. The law books are abound with cases on this point. But Atkin J’s definition in Williams v Wallis and Coxis apt in terms of the main issue in this case:

That expression does not necessarily involve personal turpitude on the part of the arbitrator, and any such suggestion has been expressly disclaimed in this case. The term does not really amount to much more than such a mishandling of the arbitration as is likely to amount to some substantial miscarriage of justice, and one instance that may be given is where the arbitrator refuses to hear evidence upon a material issue.

27.	Notably, according to Russell at page 428, the Court has an inherent power to set aside an award on other grounds.

The court has further an inherent power to set aside an award which is bad on its face: either as involving an apparent error in fact or law, or as not complying with the requirements of finality and certainty. The inherent power to set aside also extends to an award which exceeds the arbitrator’s jurisdiction and possibly to cases where fresh evidence has become available.

28.	An award will be taken to have been improperly procured by an Arbitrator when there is an improper relationship between the arbitrator and a party or a party’s solicitor.
29.	Only after a finding of “misconduct” and/or, “improper procurement” of the award, will the question then arise: should the award be set aside or not? According to Russell on Arbitration (supra) at page 432:

In the exercise of its discretion a court may refuse to interfere with an award even where there exists one of the grounds on which awards may be remitted or set aside.

APPROACHING THE ISSUES

30.	I adopt the method of Lord Justice Diplockin London Export Corporation Ltd v Jubilee Coffee Roosting Co Ltdas the “operating” structure within which to approach the issues. Accordingly, I structure my inquiry as follows:

(i)	first, I look at the arbitration agreement to see if the parties have stipulated a procedure therein. If so, and if the award was reached in breach of the agreed procedure, Rotomould will be entitled to have the award set aside “simply because the parties have not agreed to be bound by an award made by the procedure in fact adopted”.

(ii)	second, if the Arbitrator had followed the agreed procedure, I may still set aside the award on public policy if the circumstances warrant it. Here, I will consider inter-alia whether or not the Arbitrator was still in breach of the principles of natural justice.

(iii)	however, if the parties had not expressly agreed on a procedure, I must then look to examine whether a “procedure” may be implied from the written agreement, the Arbitration Act, and/or the surrounding circumstances including any custom or trade practice.

31.	At this point, I caution myself that the jurisdiction conferred by section 12(2) is not an appellate one. Rather, it is a first-instance jurisdiction. This means that I must not embark upona narrow textual analysis of the award. It means also that I must avoid re-examining the issues decided at arbitration, unless absolutely necessary. In the event that it becomes absolutely necessary to re-examine the issues, I must still avoid being too “picky”. All in all, this means that I must start on the premise that the award is sacrosanct.

32.	The sanctity of an award depends on the degree of finality it is given. Indeed, as one will come to learn, “finality” is a question of degree. The word “final” means that it is a conclusive ruling on all the matters referred. 

33.	In Fiji, clause 8 of the First Schedule to the Arbitration Act implies in every submission that:

8. The award to be made by the arbitrators or umpire shall be final and binding on the parties and the persons claiming under them respectively.

34.	Section 4 provides:

A submission, unless a contrary intention is expressed therein, shall be deemed to include the provisions set forth in the First Schedule in so far as such provisions are applicable to the reference under submission

35.	When the above provisions are read together, they would appear to give effect to the following words of Russell on Arbitration (supra) at page 378:

Unless there is an express provision in the arbitration agreement that it shall have temporary effect only, or it is an interim award, a valid award on a voluntary reference operates between the parties as a final and conclusive judgement upon all matters referred.

36.	In the case before me now, I find nothing in the parties’ agreement that limits the finality of Mr. Clark’s award in any way.

DID THE PARTIES STIPULATE A PROCEDURE? IF NOT, ARE THERE TERMS TO BE IMPLIED? 

Express Agreement

37.	Rotomould’s and DCDCL’s contract was formed when Rotomould’s Architect accepted(on 06 December 2010) DCDCL’s tender (see Appendix 1). No provision for arbitration, let alone any procedure for such, was expressly agreed between the parties. However, the parties both acknowledge that the Fiji Standard Form of Building Contract (Without Quantities Private Edition 1978) (“FSFBC”) is incorporated into their agreement. 

38.	The FSFBC makes provision for arbitration in clause 33. However, this arbitration clause does not stipulate any particular arbitral process or procedure. 

39.	I then turn to the Arbitration Act to see if a procedure can be implied from its provisions. The First Schedule to the Act sets out some standard terms. As discussed, these terms are implied in any given submission, unless the parties’ expressly agree to the contrary. This is all by operation of section 4.

40.	Rotomould and DCDCL have made no express agreement to exclude the application of any provision of the First Schedule. Hence, every single clause in the First Schedule is taken to be implied into their agreement. I must then look at the procedural course adopted by the Arbitrator, and, determine whether he had breached any procedure in the Act. 

Procedural Course Adopted By Arbitrator

41.	I observe that the Arbitrator had simply determined the issues before him from the submissions filed by both counsel and from the documents placed before him. He did not direct the filing of any pleadings. Nor did he see it fit to hear any viva voce evidence, or to even hear counsel make oral submissions. Appendix 2 sets out a chronology of emails between counsel and the Arbitrator. From these emails, it is clear that the Arbitrator had simply directed the parties to file their documents, complete discoveries, and file submissions. Both counsel did plead with the Arbitrator on several occasions for an opportunity to make oral submissions. However, these were ignored. The question is: did the Arbitrator breach any minimum standard of procedural fairness in refusing to heed counsel’s pleas? I must answer this question in terms of both the Arbitration Act says and the common law.

Arbitration Act

42.	Clause 6 of the First Schedule provides:

The parties ......, shall, subject to the provisions of any law for the time being in force, submit to be examined by the arbitrators ..... on oath or affirmation in relation to the matters in dispute, and shall, subject as aforesaid, produce ..... all books, deeds, papers, accounts, writings and documents within their possession or power respectively which may be required or called for, and do all other things which, .....the arbitrators or umpire may require.

43.	The first part of clause 6 imposes an obligation on the parties to submit to be examined by the Arbitrator. But I see no express provision obliging the Arbitrator to examine the parties orally, whether on oath or affirmation. It appears then that the Act and the First Schedule simply confer upon the Arbitrator a discretion to call sworn viva voce evidence (in the absence of an agreed procedure). 

44.	The second part of clause 6 imposes an obligation on the parties to produce all documents in their possession or power which the Arbitrator may require or call for. The language of clause 6 appears also to give a discretion to the Arbitrator to require or call for these materials. Logically, it must be a discretion that is to be exercised almost as if it is a duty, given the tremendous importance of such material.
45.	Clause 7 provides:

The witnesses on the reference shall, if the arbitrators or umpire think fit, be examined on oath.

46.	Again, the above appears to give the arbitrator a discretion to examine witnesses on oath. Notably, section 14 empowers only the High Court to subpoena any witness (who are not parties) to attend before any arbitrator. 

47.	In this case, because the parties have not expressly stipulated any procedure, and neither does the Act, it would seem that what the Act does is to leave it open to the discretion of the Arbitrator to adopt a procedure of his choice. I am fortified in that comment by the observations of Russell on Arbitration (supra) in his review of the English Arbitration Act 1950 at page 288:

An arbitrator or umpire has power, unless the arbitration agreement expresses a contrary intention, to examine on oath or affirmation the parties and witnesses appearing before him. He is not however, compelled to take evidence on oath: the matter is within his discretion, unless the mode of examination is expressly stipulated for in the arbitration agreement.

And at page 461:

The arbitrator has in general a discretion as to the manner in which the reference is to be conducted. The Court will not review that arbitrator’s discretion, provided he acts within his authority and according to the principles of justice and behaves fairly to each party…………..Like the discretion of any other tribunal, the arbitrator’s discretion must be exercised judicially, on costs as well as on substantive matters.

48.	The question to ask then is, whether it was within the Arbitrator’s authority and in line with the principles of natural justice, to refuse to grant an audience to counsel? 

Common Law – Duty To Act Fairly

49.	All the cases I have reviewed confirm the position that, whatever procedural course the Arbitrator takes, he has a duty to act fairly. This duty applies both in the conduct of the proceedings and right throughout the reference.

50.	Russell on Arbitration at pages 225 to 230 discusses this general duty as entailing:

(i)	the duty to hear each party in the presence of the other.

(ii)	the duty not to receive information from one side which is not disclosed to the other, whether the information is given orally or in the shape of documents.

51.	General duties which Russell discusses are:

(i)	duty to decide on disputes submitted and no more

(ii)	duty strictly to comply with terms of submission

(iii)	duty to decide according to law

52.	Russell also discusses some general procedural powers that Arbitrators enjoy at pages 232 to 238. 

53.	Opinions appear to differ as to whether the duty to act fairly means that the arbitrator must follow a procedure modelled on that of the court. Undoubtedly, in the absence of an express procedure stipulated by the parties, it would be ideal if all Arbitrators followed the courts’ procedural rules. But, to what extent might an Arbitrator be allowed in the exercise of his own discretion, to depart from such an ideal course without necessarily compromising his duty to act fairly?

54.	According to Mustill & Boyd, The Law and Practice of Commercial Arbitration in England (1982), the common law position is that the Arbitrator must follow an adversarial procedure modelled on that of the court (unless otherwise authorised by the parties). This means that he must hold a hearing, apply rules of evidence, and base his decision on parties’ arguments and evidence.

55.	Russell on Arbitration(supra) at page 232, said that arbitration “need not follow the procedure laid down for proceedings in a court of law”. He adds that it is sufficient if “the practice of a particular trade in relation to its arbitrations” is followed, so long as it is fair to both parties.

56.	In Andrews v Mitchell, Lord Halsbury warns however that an arbitrator who is not legally qualified is bound to make slips if asked to adopt of procedural course modelled on that of a court of law. However, so long as those slips are on “matters of form” rather than substantive slips, the court should not interfere. He opines, in the particular case before him, that:

...... the mode in which the whole thing arose and was disposed of was so slipshod and irregular that it might lead to injustice.

57.	The question I ask at this time is, what are some of the basic things that an Arbitrator who is not legally qualified, should be expected to observe, to ensure that he disposes the matter not in a slipshod and irregular manner which might tend to lead to injustice?

Common Law Minimum Standard of Fairness 

58.	In Rv Deputy Industrial Injuries Commissioner, ex – parte Moore, Wilmer, LJ at page 487, said natural justice:

... involves ... [hearing] both sides, assuming that he[i.e. the Arbitrator] has been requested to grant a hearing, and ..... [allowing] both sides to comment on or contradict any information that he has obtained. This would doubtless apply equally in the case where a hearing had been requested, but refused, for in such a case it would not be in accordance with natural justice to acton information obtained behind the backs of the parties without affording them an opportunity of commenting on it.

59.	In the same case, Lord Justice Diplock said at pages 488 to 490 that natural justice means basing one’s decision on evidence, that is, on material “which tends logically to show the existence of facts relevant to the issue to be determined” rather than an adherence to the technical rules of evidence. 

60.	Diplock LJ adds that the rules of natural justice also means that, if a hearing is requested, listening fairly to the contentions of all persons who are entitled to be represented at the hearing. This entails:

(a) ...consider[ing]such “evidence” relevant to the question to be decided as any person entitled to be represented wishes to put before him; 

(b) inform[ing] every person represented of any “evidence” which the deputy commissioner proposes to take into consideration, whether such “evidence” be proffered by another person represented at the hearing, or is discovered by the deputy commissioner as a result of his own investigations;

(c)allow[ing] each person represented to comment upon any such “evidence” and, where the “evidence” is given orally by witnesses, to put questions to those witnesses; and

(d)allow[ing] each person represented to address argument to him on the whole of the case. This in the context of the Act and the regulations fulfils the requirement of the second rule of natural justice to listen, fairly to all sides ...

61.	In TrusteesofRotoairaForestTrustv Attorney-General, Fisher J of the New Zealand High Court, relying on Mustill & Boyd (supra), gave the following guidelines:

a.	Each party must have notice that the hearing is to take place.

b.	Each party must have a reasonable opportunity to be present at the hearing, together with his advisers and witnesses.

c.	Each party must have the opportunity tobe present throughout the hearing.

d.	Each party must have a reasonable opportunity to present evidence and argument in support of his own case.

e.	Each party must have a reasonable opportunity to test his opponent's case by cross-examining his witnesses, presenting rebutting evidence and addressing oral argument.

f.	The hearing must, unless the contrary is expressly agreed, be the occasion on which the parties present the whole of their evidence and argument.”

Did The Arbitrator Breach His Duty to Act Fairly?

62.	The parties did not stipulate any express procedure. Accordingly, the Arbitrator cannot be said to have committed a breach in that regard. The Act (and First Schedule) gives the Arbitrator such a wide discretion as to which procedure to adopt. When both counsel were pleading with the Arbitrator for an opportunity to make oral submissions before him, the Arbitrator was being called upon to exercise his general procedural power in a particular way. I am of the view that it was then incumbent upon the Arbitrator, to exercise his discretion in accordance with his common law duty to act fairly, and to take heed of their pleas. I say this on the basis of the above cited cases. Because he did not do so, he committed a misconduct in terms of section 12(2). Having said that, the discretion then becomes available to me, at this time, as to whether or not the Award should be set aside? Before I do so, there is nothing to suggest, contrary to Rotomould’s argument, that it had pleaded with the Arbitrator for an opportunity to call viva voce evidence, let alone, on which aspect of the issues would require viva voce evidence. The trail of correspondence in Appendix 2 merely establishes that counsel were merely seeking to be heard on submissions.

SHOULD THE AWARD BE SET ASIDE ON ACCOUNT OF THE BREACH OF NATURAL JUSTICE OR ON ANY OTHER GROUND?

63.	I have found above that the Arbitrator did commit misconduct by not heeding counsels’ pleas to be heard on submissions. But that irregularity can only merit the setting aside of the award if the court is satisfied that as a result of that breach, Rotomould has suffered a substantial injustice. 

64.	As McNair J in Rotheray (E.) & Sons Ltd v Carlo Bedarida & Coobserves:

The more difficult question, however, is whether the extent of that irregularity is such as to justify interference by this court either by way of setting aside the award or remitting the award. The determination of that issue...depends upon whether the court is satisfied that there may have been – not must have been – or that this irregularity may have caused – not must have caused – a substantial miscarriage of justice that would be sufficient to justify the setting aside or remitting of the award, unless those resisting the setting aside or remission could show that no other award could properly have been made than that which was in fact made, notwithstanding the irregularity.

...

65.	As I have set out above at paragraph 27, this court also has an inherent power to set aside the award if it:

(i)	is bad on its face, either as involving an apparent error in fact or law

(ii)	does not comply with the requirements of finality and certainty

(iii)	exceeds the arbitrator’s jurisdiction

(iv)	possibly, as Russell argues at page 428, where fresh evidence has become available.

66.	Although an Arbitrator’s award is final, it will be set aside if an error of law is allowed to appear on its face, unless the error is immaterial to the decision (Buerger v Barnett). On the other hand, as Russel points out at page 447 - 448:

Where an arbitrator makes a mistake either in law or in fact in determining the matters referred, but such mistake does not appear on the face of the award, the award is good notwithstanding the mistake, and will not be remitted or set aside. 

An error of law on the face of the award means that you can find in the award or a document actually incorporated thereto, as, for instance, a note appended by the arbitrator stating the reasons for his judgement, some legal proposition which is the basis of the award and which you can then say is erroneous.

Unless upon the face of the award we can distinctly collect what the Arbitrator intended to decide, and that we can see that he has decided wrongly, the court will not interfere.

67.	Motta J in Gunter Henck v Andre & Cie S.A

It is well established on the authorities that although the courts are entitled to and indeed, must set aside awards containing errors of law on their face, this jurisdiction is not lightly to be exercised. If parties choose to have their disputes settled by arbitrators, then subject to certain limited exceptions, the attitude of the courts has been that the parties should take arbitration for better or for worse.

68.	Below I consider whether or not the irregularity in the breach of natural justice may have been and/or may have caused a substantial miscarriage of justice to Rotomould. In addition, I consider the various heads of complaints that Rotomould states in its Originating Summons in terms of the other grounds for setting aside set out above in paragraph 67.

Essence of Time

69.	It is submitted that, because the Arbitrator did not hear counsel’s oral submissions, he could not have properly assessed the evidence that was before him and as a result, he would have had a rather patchy view of the legal rights and obligations of the parties. One of the main things that the Arbitrator is alleged to have overlooked or ignored in this regard is the fact of the essence of time in the construction contract. It is argued that there was ample evidence that DCDCL had delayed - resulting in the loss of the project’s time objectives and a cost overrun to Rotomould. Rotomould argues that, had the Arbitrator heard oral submissions from counsel, the evidence implicating DCDCL’s breach would have been properly contextualised. It meant also that the Arbitrator would be oblivious to the (alleged) fact that the excuses DCDCL gave were either unreasonable or were outright lies.

70.	What Rotomould is saying essentially is that, if counsel had been allowed to make oral submissions, they would have addressed the Arbitrator properly on which of them actually breached the agreement. In arguing this, Rotomould appears to be contradicting itself as to what exactly was the terms of reference to the Arbitrator (see below Rotomould’s head of complaint – exceeding jurisdiction).

71.	Apart from that, I cannot find anything in the Award to suggest that the award is bad on its face and/or that the Arbitrator failed to properly assess the evidence. In his award (see Appendix 3), the Arbitrator first noted that the parties’ contract was formed when Rotomould’s Architect accepted DCDCL’s tender vide a letter of acceptance dated 06 December 2010. He also found the following:

•	the said letter of acceptance stipulated that the site would be available from 08 December 2010, 

•	that the commencement date would be 03 January 2011, and 

•	that the completion date was to be 04 July 2011 (i.e. 26 weeks of construction time).

•	he then observed that when the parties reached agreement, no building permit had been issued by the LRLA.

•	he commented that it would be illegal to commence construction on site without such a building permit. The building permit was not issued until 28 April 2011.

•	having observed the above, the Arbitrator then found that time should have been extended so as to allow the 26 weeks construction time to be calculated from 28 April 2011 to 27 October 2011.

72.	I am of the view that the conclusion that the Arbitrator reached was not so perverse. In saying that, I believe I am fortified by the trail of correspondence between the parties in Appendix 1 which shows clearly that around March and April 2011, they were still exchanging emails about the delays in the approvals. In fact, there was even one email from Rotomould’s Architect suggesting that the cause of all the delay, as told to him by officers from LRLA, was in the late approval for subdivision from the Director of Town and Country Planning. This confirms that the approvals were not in place even after the agreed starting date.

73.	The trail of emails also show that in February, engineering designs were being revised by the Engineers. 

Letter of Elia Lawena

74.	Rotomould appears to think that the Arbitrator had completely ignored or overlooked a letter written by one Mr. Elia Lawena, a senior official of the LRLA. Clearly, Rotomould had intended to use that letter as evidence to refute DCDCL’s excuse that its delay was due in most part to the Stop Work Notice by LRLA.It appears that DCDCL is alleging that it was “advised” by LRLA not to commence work until all approvals were in place. It seems that Mr. Lawena’s letter is intended to refute the allegation that LRLA did advice DCDCL as such and/or that the approvals were always in place. Suffice it to say that, if LRLA did in fact DCDCL as alleged, such an advice would only be a responsible one, and in line with LRLA’s core responsibilities of ensuring regulatory compliance.

75.	Mr. Lawena’s intimation that the consents and approvals were in place all along appears relatively feeble when held up against the trail of emails between the parties. The emails tend to confirm that the approvals were not always in place at all material times. In light of that, the Arbitrator could be excused if, (i) in fact he had formed the view that it would be a superfluous exercise to have to call oral sworn evidence to determine the truth or falsity of the letter, or (ii) if he did overlook to consider the letter. I think Mr. Lawena’s letter would have carried little weight when held up againstthe trail of emails in Appendix 1.

Expert Skill

76.	The Arbitrator, Mr. Clark, is a qualified Architect with tremendous experience in the building industry in Fiji. Like all Arbitrators with specialist skills, he is entitled (in fact he is expected) to make use of his own expert knowledge.

77.	In Johnson v Cheape, as reported by Russell, a submission recited that the Arbitrator had been appointed on account of his skill and knowledge of the subject. One of the parties brought before him a statement of certain facts which the party alleges to be material, and offered to support it by proof. The House of Lords held that the Arbitrator was justified in refusing to receive it, if, taking all matters alleged to be facts into consideration, with his own local knowledge to guide him, and all the circumstances in his view, he felt that such facts would have no effect upon his determination.
Unjust Enrichment?

78.	Rotomould is also aggrieved about that part of the award wherein DCDCL was being compensated for some building materials it had bought for the project, but which are still in DCDCL’s possession. It submits that this amounts to an unjust enrichment because there was no Order for DCDCL to give up the materials to Rotomould. 

79.	This part of the award can be remitted to the Arbitrator under section 11 of the Arbitration Act.

Power to remit award

11.-(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.
(2) Where an award is remitted the arbitrators or umpire shall, unless the order otherwise directs, make their award within three months after the date of the order.

80.	Section 11 obviously gives power to this court to remit part only of the matters referred as opposed to remitting the entire award. For the avoidance of doubt, I direct that the Arbitrator is to deal only with this particular matter on remission (i.e. the release of the materials and fabricated steel by DCDCL to Rotomould). Once the materials have been released to Rotomould, DCDCL may then apply to this Court for the release to it of the award sum which is deposited in this Court.

Exceeding Jurisdiction?

81.	The issue has also arisen between the parties as to whether or not the Arbitrator exceeded his jurisdiction in awarding loss of profit in favour of DCDCL. The general jurisdiction of an Arbitrator derives from the arbitration clause in their agreement, which, in this case, is clause 31 of the FSFBC. The jurisdiction in each particular case depends on the particular terms of the submission to the Arbitrator. 

82.	As Russell on Arbitration (supra) points out at page 219:

It must always be remembered that an arbitrator derives his authority from the agreement between the parties, and that consequently his powers and duties are only those that the parties have agreed to place upon him.

83.	The issues to be considered at this stage are:

(v)	what is the general jurisdiction of the Arbitrator in terms of the FSFBC?

(vi)	what were the terms of reference to the Arbitrator?

(vii)	did the Arbitrator exceed the general jurisdiction and/or those terms of reference?

(viii)	if he did, should the award, or part of it, be set aside on that account alone?

(ix)	if he did not exceed his jurisdiction, was the amount he awarded on loss of profit reasonable?

84.	According to Rotomould, the parties had mutually terminated their agreement “without any conclusion as to whether either of them was in breach”. It is argued that the Arbitrator was to deal only with the monetary value of work that DCDCL had carried out. Hence, as submitted, the Arbitrator exceeded his jurisdiction when he assessed and made an award for loss of profit in favour of DCDCL. DCDCL refutes Rotomould’s submission. It argues that it was within the terms of reference to the Arbitrator to consider which party had breached the agreement and flowing from that, to assess and award consequential damages. Deo, a director of DCDCL, asserts in his affidavit that DCDCL had always made it unequivocally clear that it was pursuing its claim on loss of profit. 

85.	Clause 33 of the FSFBC (which is incorporated into the parties’ agreement) and which sets the general jurisdiction of the Arbitrator, does not appear to forbid the Arbitrator from dealing with the issue of liability. It provides in its relevant part:

…in case any dispute or difference shall arise between [the parties]…as to the construction of this contract or as to any matter or thing of whatsoever nature arising thereunder or in connection therewith…..then such dispute of difference shall be and is hereby referred to the arbitration and final decision of a person ….

86.	The words “arising thereunder or in connection therewith” the contract would appear to be all inclusive and wide enough (when put together) to include the jurisdiction to consider breach and assess damages. In Heyman v Darwins Ltd, Lord Porter said that the words “arising out of contract” have a wider meaning than the words “under a contract”.

87.	The parties’ Agreement To Defer Future Differences to Arbitratorwhich I take as the document which sets out the particular “terms of reference” for the Arbitrator in this case, appears to define the issue between the parties as one “concerning the breach of a building contract”:

Whereas by an agreement in writing dated the 6th day of December 2010………….it is provided that differences arising between the parties thereto shall be referred to an arbitrator….[a]nd whereas differences….have arisen and are still subsisting between the parties concerning the breach of a building contract….[n]ow we, the said parties [DCDCL] and [Rotomould] do hereby refer the said matters in difference to the award of MR FRASER CLARK.

SGD. DCDCL & Rotomould

88.	It appears from the above that what DCDCL and Rotomould actually referred to the Arbitrator were “the said matters”. The parties’ actual written submissions to the Arbitrator contained a direct (or indirect) allegation of a breach on the part of the other. DCDCL’s submissions dated 24 September 2012 include a claim for loss of profit. Rotomould’s submissions dated 14 September 2012 contains the following at paragraphs 26 and 27:

The Company has never denied payment owed to the Contractor for works that the Contractor carried out on the site and as such engaged a quantity surveyor to estimate such value of same which is in accordance with the FSFBC.

It is therefore submitted that the Contractor should be paid the value estimated by the quantity surveyor as this is in accordance with the FSFBC. Furthermore, the Contractor should be ordered to pay damages to the Company for the incompletion of works and breach of the services agreement. (my emphasis)

89.	After considering all of the above, I find that it was within the jurisdiction, and terms of reference of the Arbitrator, to consider and determine breach as well as consequential damages. 

Did the Parties Mutually Terminate their Contract?

90.	As stated above, Rotomould argues that, because the parties had mutually terminated the agreement, the Arbitrator should not have considered breach of contract and consequential damages. As a general point of legal reasoning, that argument is correct. However, as a matter of fact, there was nothing before the Arbitrator to indicate that the parties did indeed mutually terminate their agreement. I say this on the basis of the following key points. First, the parties did both make submissions to the Arbitrator on breach of contract and damages. Second, having both made submissions to the Arbitrator on breach of contract and damages, it follows that any purported mutual termination of their contract must therefore be invalid. Thirdly, the alleged mutual termination of the contract does not appear to be documented. In general, a mutual termination of agreement involves the parties mutually discharging one another from their respective obligations under the contract. The mutual discharge of their obligations is important for two reasons. Firstly, it serves as mutual consideration for the (latter) agreement to terminate the original agreement. Because a mutual termination of agreement isa whole new agreement in itself,it must be supported by mutual consideration in order to be effective. It is sufficient consideration for this purpose if the parties both agree to discharge all their obligations t0 one another. And, by agreeing to discharge one another’s obligations, the parties are thereby, mutually, relinquishing their right to sue for breach of contract. As it happened here, both parties had made allegations and cross-allegations of breach to the Arbitrator. Both were seeking to be compensatedfor the alleged breach of the other. The only conclusion one can draw from this is, either:

(i)	the earlier purported mutual termination of agreement had failed for lack of consideration, or

(ii)	that the so-called mutual termination is, but a fabrication on the part of Rotomould.

91.	I reiterate at this point that the purported mutual termination of agreement does not appear to have been formally documented. In any event, there is nothing on the face of the award to suggest that the Arbitrator might have considered this point, and erred in his application of the law or in his mobilisation of the facts. 

Attempt to Vary the Contract

92.	Rotomould argues that the move to terminate the agreement was initiated by DCDCL. From DCDCL’s emails to Rotomould dated 04 and 05 May 2011 (Appendix 1), it appears that DCDCL was indeed seeking a variation in light of the delays and the rising costs, as a condition to continuing with the works. When Rotomould would not concede, and DCDCL kept insisting, Rotomould finally responded with a letter/email dated 23 May 2011 by which it terminated the contract. Whether DCDCL’s conduct was an attempt to completely rescind and abandon the original agreement, or, merely to vary it, is a question of law. In all likelihood, it was outside the expertise of the Arbitrator.

93.	It must be remembered that, even before DCDCL requested for a variation, Rotomould had in fact varied some aspect of the engineering details as shown in the trail of emails in Appendix 1. It must also be remembered that the construction time was delayed considerably by the lack of approvals at the material time.

94.	In his reasoning (Appendix 3), the Arbitrator appears to consider that such variations may give rise to additions or deductions from the contract sum, and will certainly require an adjustment of the completion date. It is certainly within his expertise to have made that consideration. I find nothing on the face of the award to suggest that the Arbitrator might have erred in fact or in law in this regard.

Was the Amount Awarded Reasonable?

95.	Rotomould's Architect deposes in his affidavit that during pre-Arbitration negotiations, DCDCL had sought $131,000-00being its alleged 20% loss of profit. Rotomould alleges that the figure is unreasonable. The Architect adds that the amount of work carried out by DCDCL is quantifiable at $20,000 in terms of the Progress Payment Certificate and assessed at $11,730 by Rawlison Jenkins Limited (Quantity Surveyor). The argument is that if DCDCL did not agree with that assessment, it should have engaged its own Quantity Surveyor. All this, it is alleged, the Arbitrator failed to take into account.

Other Allegations 

96.	Rotomould also produces a letter from the landowner in which the landowner (Moko) denies that DCDCL had ever seen him about some other matters. It is not clear if the Arbitrator did take this into account at all. I am the view that this would have had little bearing on the Arbitrator's finding – given the delay in the approvals. Again, I do not think that the Arbitrator erred in law or in fact in this regard.

DID THE ARBITRATOR IMPROPERLY PROCURE AWARD?

97.	 There is nothing before me to suggest that Mr. Clark did improperly procure the award.

TIME FOR MAKING AWARD

98.	Rotomould also highlights that Clause 3 of the First Schedule stipulates that the arbitrators:

 "shall make their award in writing within three months after entering on the reference, or after having been called on to act by notice in writing from any party to the submission, or on or before any later day to which the arbitrators, by any writing signed by them, may, from time to time, extend the time for making the award".

99.	One of the allegations of Rotomould in this case is that Mr. Clark had delayed unnecessarily in handing down his award. Mr. Clark's award was handed down in March 2013 (i.e. almost a year after his appointment on 05 March 2012). The question to ask at this time is, whether or not Mr. Clark's delay amounts to a misconduct and if so, whether such misconduct is serious enough to justify the setting aside of the award? Given that clause 3 stipulates a particular time frame for making an award, it is arguable that a failure on the part of the Arbitrator to comply with the stipulation must amount to some "legal misconduct". I do note that section 10 of the Arbitration Act gives power to the Court to extend the time to make an award.

Power to extend time for making award

10. The time for making an award may from time to time be extended by order of the court, whether the time for making the award has expired or not.

100.	In commenting on the equivalent provision in the English Arbitration Act 1950, Russell on Arbitration(supra) observes at page 350 that:

The power to enlarge time can be exercised although the award has in fact already been made after the period fixed for making it has expired. The effect of an order of enlargement is that the extended time is to be treated as if it had been originally given in the arbitration agreement. Consequently, the award and all else done in the arbitration during such extended time is rendered valid and effective.

(see Oakland Metal Co. Ltd v Benaim (d) & Co. Ltd [1953] 2 Q.B. 261; Danley (Earl of) v London, Chatham & Dover Ry (1867) L.R. 2 H.L. 43; cf. Knowles & Sons Ltd v Bolton Corpn [1900] 2 Q.B 253)

101.	Russellopines though that the ideal remedy for undue delay is the removal of the Arbitrator. In this case, either party could have applied to the High Court pursuant to section 12(1) of the Actto remove the Arbitrator on account of the delay.But neither did. The trail of emails in Appendix 2 will show that well after the scheduled time for the award, both counsel were still engaging with the Arbitrator to seek a date for formal submissions.I am of the view that the appropriate thing to do in this case, in the interests of finality, is to extend the time for making the award – even though the award has already been made. In so extending the time, I have taken into consideration all the foregoing discussions and especially, that no serious miscarriage of justice would appear to befall Rotomould if I did so.

CONCLUSION

102.	Although the Arbitrator did not take heed of counsels' request for oral submissions, I am of the view that no other award could properly have been made than that which was in fact made by Mr. Fraser Clark. However, as I have directed above in paragraphs 80 to 82, the award is to be remitted to the Arbitrator only on that part as stated above. The award sum as deposited in Court is to be released to DCDCL upon a formal application following the release of the items. Parties to bear their own costs.

Anare Tuilevuka
JUDGE

17November 2015
Appendix 1
Date	Event/Action	Details	
06/12/10	Agreement	06/12/10 was date Rotomould accepted tender of DCDCL. That, plus FSBC 1978, and tender = Agreement. Contract award (VIP) = $655, 059.52	
20/12/10
9.24 a.m.	Email from DCDCL to Architect	Please send 1 set of drawings and specifications for the above job. Tobe issued later. Also please note we are arranging for Native Land to give consent to install water supply and we have sent drawings to Lautoka Rural Authority for approval, we will bill you our cost for this. You can bill the client not me as he has asked you to do this for him and not us. If you are billing us than we will bill you for every inspection as well…you better clear this with the client..thanks.	
20/12/10
11.46 a.m.	Email from Architect to DCDCL	Reply below in RED	
January 2011	Bad Weather	Unfavourable weather conditions prevented DCDCL from commencing work on site.	
06/01/11	Email from Rotomould	Requesting colour for Aluminium Composite Cladding.	
07/01/11	E-mail from DCDCL	To Architect. Heavy rain in Lautoka. Cannot work on site. So doing steel reinforcement @ Denarau Workshop.	
07/01/11	Email from DCDCL	To Architect. Requesting missing page numbers of the plan.	
10/01/11
12.03 p.m.	Email from DCDCL to Architect	Advising that DCDCL still has not received any approved plan. Also, low pressure over Fiji and heavy continuous rain means they cannot yet work on site. Meanwhile, continuing with steel reinforcement work in own workshop.	
10/01/11
3.21 p.m.	Email from Architect	To DCDCL. Attaching elevation with colous as requested by DCDCL.	
13/01/11	Email from Architect to DCDCL	Replying to DCDCL email-request of 07/01/11 for missing pages.	
01/02/11	Email from DCDCL to Architect	Saying DCDCL has taken heed of Architect advice and called Shri Singh & Associates who has requested some photos of site.	
02/02/11	DCDCL ceases all works		
03/02/11
9.03 a.m.	Email from Shri Singh & Associates to Architect	Advising on engineering changes to be made after review of design.	
03/02/11
9.30 a.m.	Email from Architect to Shri Singh & Associates	Attaching photos of warehouse site and requesting site inspection.	
03/02/11
12.09 p.m	Email from Architect to Shri Singh & Associates	Attaching revised drawings and advising of minor changes on Sheet S2 and an extra sheet S2b	
03/02/11
5.30 p.m.	Email from Architect to DCDCL	Attaching revised drawing. Advising that the footing detail was revised after inspecting the ground condition. 4 sheets of drawing attached.
•	"Please submit your cost for this works for our verification and approval"
•	"Do not commence with this works until written approval is given"	
04/02/11
7.53 a.m.	Email from DCDCL to Architect	Advising that further to site visit with officer from Architects and Rotomould:
•	All reinforcing steel prepared in workshop
•	All structural has been purchased
•	Two contemporary vehicle crossing constructed
•	Top soil scraped off
•	30% of stone delivered to site.	
04/02/11
11.46 a.m.	Email from Architects to DCDCL	Attaching drawings with changes. Responding to DCDCL's "protest" that the steel works had been prepared by saying that "please note that we clearly noted in the drawings that no steel has to be fabricated until the engineer inspects and approves the ground condition. You did this at your own risk".	
09/02/11
11.35 a.m.& 12.35 p.m.	Email from DCDCL to Architects	Saying that they have not received any OHS drawings for project.	
09/02/11
1.55 p.m.	Email from Architects to DCDCL	Advising that "the documents were collected by CDP…receipt number 67136 yesterday. Please check with CDP.	
10/02/11
3.10 p.m.	Email from DCDCL to Rotomould & Architect	Advising that they have lodged plans with LRLA LRLA site inspection scheduled for tomorrow.	
15/02/11	Email from DCDCL to Architect	Advising that they still have not received approved plan. Continuing heavy rain in West. Hard to proceed with civil works. Also waiting for another agreement.	
01/03/11
11.05 a.m	Email from Rotomould to DCDCL & Architect	Complaining of delay. Work never started 23/12/10. It did not start 03/01/11.
"I want job to be done quickly but it does not mean engineers and architects have to be bypassed. Entry to site from main road is no big deal according to LRLA. Necessary changes are being done. This however doesn't prevent work to progress on the land e.g. scraping, consolidation etc.
"I am meeting LRLA this afternoon. I am sure things would be fast tracked.	
01/03/11
11.23 a.m.	Email from Architect to Rotomould	Revised plans attached as requested.	
01/03/11
5.36 p.m.	Email from Architect to DCDCL	As discussed with Prakash (Rotomould)	
02/03/11	Email from DCDCL to Architect & Rotomould	Responding:
•	Job did start 23/12/10
•	Referring to Acceptance Letter from Architects
•	Went to job site and scrapped top soil but advised by LRLA not to start till plans passed.
•	On Prakash's (Rotomould) request, we have ordered and paid for all reinforcement steel and structural steel. 
•	All reinforcement completed up to ground floor and column and is in our workshop which Prakash has seen.
•	2 containers placed on site in first week of January.
•	We went out of our way, took plans to iTLTB, WAF, Fire, OHS etc to get approvals.
•	Only approval now left is LRLA.
•	Yesterday, Prakash asked me to talk to landowner.
•	Side entry to building is illegal. Now trying to get entry from main road.
•	Then we will take to LRLA	
08/03/11	Email from DCDCL to Architect	Please get all the relevant approval before sending us drawings. Please can you send the first site meeting minutes.	
09/03/11	Email from DCDCL to Architect	Please advise when we will receive approved drawings and minutes of site meeting.	
11/03/11	Email from Architect to DCDCL	Subject: Revised Site Plan. Attaching Meeting Minutes and promising to follow up with LRLA.	
14/03/11	Email from DCDCL to Architect	Please advice for the update on approved drawings.	
15/03/11	Email from Architect to DCDCL	Advising that they had called LRLA last week. LRLA informed that the plans are OK. The delay in getting approvals was due to problems with subdivision. DTCP has informed Rotomould as well as the "landlord" from whom Rotomould bought the land. Liaising with DTCP to sort things out.	
16/03/11	Email from DCDCL to Architects	Thanks for email. If you can tell us when is the approximate date for the approval of plan so we can start the project, then it will be great help.	
27/04/11	DCDCL email	Sent to Architect stating following reasons for non-commencement of work:
•	Sub-divisions plan not approved; survey plan not done; building plans not approved; increase in price of building material and fuel; most reinforcing steel work done.	
02/05/11	Email from Rotomould to DCDCL	Telling Saleshni (DCDCL) to direct concerns directly with Architect	
03/05/11	Email from DCDCL to Rotomould	"We appreciate for being awarded as the main contractor.. Due to delay in approval plans and land issues by your company we were unable to start the job in December 2010. We have ordered all the materials last year in December but due to storage problems we have to credit all the materials because the hardware's cannot keep the materials for 5 months. Now we are getting these materials on a higher price from the price we were getting in December. Also note that VAT has also increased from 2.5% even the fuel price has gone up too. We have got all the orders and quotations with us. As you are very well aware that all the prices for building materials has gone up so our total contract sum will also increase. We are working on our new quotations and prices. We have also done some works on the site and also a lot of works has been done off site (in our workshop).
Before the starting the job we need an answer from you. Please advise.	
04/05/11	Email from DCDCL to Architects	…this is an exercise of remobilisation. Re-commencing the project entails (but not limited to):
•	Scraping off top soil again
•	Re-mobilisation of equipment
•	Re-establishment of site
Please note also that from the time when the building works were stopped and up until now, there has been significant increase in prices of building materials and fuel.
Moreover please kindly note that we have been holding onto the building materials that we procured for this project and storing them for last 5 months. Not only this has taken storage space in our warehouse but has toed up our cash flow.
We have also spent significant amount of labour in getting the materials ready for site. For e.g. we have prepared all foundation reinforcement cages and other structural members reinforcement cages.
We are happy to recommence works should you furnish us with a Variation Order.	
05/05/11
10.11 a.m	Email from Architect to DCDCL	As explained to you on phone today, Patel is out of country and he is the only one who can make decisions on the variations as mentioned below. We hereby request if you can commence work on site and in the meantime submit your variation claim so we can have a look and a decision will be made once he is back.	
05/05/11
10.54 a.m.	Email from DCDCL to Architect	Since Patel (Architect) is out of country – please approve our variations as attached. Then we will recommence work.	
10/05/11	Email from DCDCL to Architect	Submitting 1st claim to sum of $75,700.81 and attaching breakdown of costs.	
11/05/11
8.55 a.m.	Email from DCDCL to Architect	Further to your contract and acceptance letter dated 6th day of February 2010 and our contract, we advice the following;
1)	Architects payment certificate must be issued every 4 weeks
2)	Interim certificate is well over due and now we give 3 day's notice to issue payment certificate
3)	Failing this, a complain will be lodged to Architects Association of Fiji
4)	And Arbitration Clause will be relied upon.	
11/05/11
9.27 a.m.	Emal from Architects to DCDCL	"You had not submitted your claim earlier how can you expect us to issue payment certificate. We have received your claim only yesterday and we will need a week to issue you payment certificate. You can not demand for this. Also we would like to remind you that there are procedures for everything and please stop threatening us.	
23/05/11	Letter from Architect to DCDCL	Letter Terminating the Contract for the Construction of the Warehouse & Office Building as follows:
On behalf of our client, Rotomould (Fiji) Ltd, we advise that your contract for the construction of the Warehouse & Office Building has been TERMINATED.

We have carried out our site inspection on 21st May 2011 and note the following:
a) Two empty containers are on site.
b) Top soil was scraped but now over grown with grass and weeds.
c) Access was formed using culverts with gravel over the existing side drainage. 

From the above inspection we instruct that you now please remove the two containers from the site before the 27th May 2011 T 10am. If not removed by this time then we will have no option but move containers to a location on site to suit our client.

Site was given to you from 8th December 2010 and the commencement date was 3rd January 2011 and completion date being 4th July 2011 (26 weeks from commencement). No urgency has been shown in completing this project and works done in this period is not satisfactory. 

Based on the above we provide you with a certificate for works done to date. (Progress Certificate…… Final).

This certificate is done in the normal manner on progress of works done on site. We note that ……….. will now engage on independent Quantity Surveyor (Q.S) to verify this certificate payment and ….. claim. Until this process is being done our client will pay the amount certified by us. I think that this is a fair way to go for both parties.

We also note that in your claim you have claimed for material not on site, we are in no position to process this under this contract. Our client however has suggested that this material could be purchased by the new contractor (at an agreed cost). This will be arranged by Prakash Chand (Rotomould Fiji Ltd). Please call and arrange for this.

Also in your claim you have shown price difference of materials, our contract does not allow any provisions for these additional claims.

Your claim also indicated the following:
a) Water Meter $101.00 plus $40.00 commission.
b) NLTB $225.00 plus $33.72 fees.
c) NLTB $ 80.00 commission
d) Labour $216.00
e) Transport $100.00 
Total $795.75

You will need to arrange this with Mr Prakash Chand as this is not part of the contract.

Also, the claim to P. Kumar Electrical Services of $1,000.00. Please provide details of this as all electrical works are part of the contract and therefore this is being claimed separately (cash cheque) We have already seen the site and there is no electrical works done on site.

Our client has mentioned that while discussing this project you and your Mrs had said in conversation that:
a) You should get the job done by anybody who is cheaper than him.
b) Also, you had mentioned about the increase in cost of materials and the increase is your lump sum price for this project. 

Being a lump sum tender for this project, cost of material increase cannot be added.

We confirm this termination on behalf of our clients and the following instructions to complete the process:
a) Remove two containers from site before 10am on 27/05/11.
b) Submit certificate to client for payment. This will be done within 14 days of you submitting the signed copy.
c) Your claims for additional items (NLTB etc.) to be arranged between Mr Prakash Chand and yourself.
d) Additional materials you have (not on site), Prakash Chand and you to arrange sale with new contractor at agreed cost.

We hope that this can now be facilitated and finalised in a proper manner with our client.	
24/05/11
12.03 p.m.	Email from Architect to DCDCL	Further to our earlier discussion, please find attached our letter on behalf of Rotomould Fiji Ltd. Also attached is a payment certificate (please collect original from our office or advise us on how you want it sent.	
24/05/11
12.49 p.m.	Email from Architect to DCDCL	TNT does not come for pick up from our office, if you want you can arrange with them for pick up or else we wills end by CDP.	
24/05/11
12.57 p.m.	Email from DCDCL to Architects	Put it in CDP freight paid.	
24/05/11	Progress Payment Certificate	Carried out by Rotomould on value of work done. Quantity Surveyor (Rawlinson Jenkins) evaluated work at $11,730-00.	
17/06/11	Letter DCDCL to Architects	In conjunction with the above said project, we were awarded the contract by way of a written confirmation letter dated 06 December 2010 from the Architect (Design Hut). The letter states that both parties (Architect/Client) had agreed to our tender amount after their joint meeting.
Upon the advice of the Architect (Design Hut) as per his letter of 06 December 2010, site possession was available from 08 December 2011 (Sic) with commencement of work by 03rd January, 2011. Acting in good faith and without further delay, Deo Construction Limited mobilised on site on 22nd December 2010.
Whilst in the process of site possession and mobilisation, the following activities were undertaken on site and off site:-
1.delievery of 2x20 I containers to site
2.scraping and levelling of site with Deo Hire Excavator (EX100)
3. loading of top soil on site to Deo Hire 10 wheeler truck with carting and dumping to location on site.
4.forming of two of vehicular crossing with 10 no. precast concrete culverts (size – 600 mm diameter x 1200 mm long).
5.cleaning of overgrown shrubs on site.
6. cleaning of drainage system around site.
7.fabrication of steel work in our workshop for footings and pads
8.ordering and purchasing of materials (structural steel, formwork, reinforcing steel, plumbing and fittings.

During the progress of work on site, Lautoka Rural Local Authority advised us to stop all site activities due to the following reasons:-
-there were still some issues to solve with the owner (Mr .Moko)
-building plans pending for approval with council
-survey plans to verify all boundary pegs not done
On 28 April 2011, Design Hut wrote a letter confirming obtaining of approved drawings from Local Authority and request our company to commence work on site from 29 April 2011.
For no reason, our contract was terminated as per letter dated 23rd May 2011.
We were issued with a progress payment certificate no. 1 (Final) dated 24th May 2011 after verification of work by the Architect (Design Hut) amounting to $20,000 to which the client should honour payment within 14 days of receiving certificate in accordance with contract documents. The client in using some delay tactics has not released a single cent to us.
As a result of the said termination, Deo Construction Limited has suffered loss and damage and our particulars of loss are calculated as per our statement of claim stipulated below:-
(tabulated figures omitted)
Interest will incur from now onwards until payment to contractor is settled in full. 
We have also given ample time to the owner to engage an independent quantity surveyor to assess the amount of work carried out but nothing has been done to date.
We also write to advise that whilst the work on site was being stopped by LRLA, work in the office was being carried out.
We therefore demand a call for arbitration as per clause 33 subclause(1) which states both parties to resolve such dispute of difference shall be and is hereby referred to the arbitration and final decision of a person to be agreed between the parties, or, failing agreement within 14 days after either party has given to the other a written request to concur in the appointment of an arbitrator. Should the Architect fail to take action we have no option but to refer the matter to Fiji Architects Association.
Thanking you in advance and look forward to your cooperation.	
18/06/11	DCDCL letter to Architect	Outlining its claim and requesting for matter to proceed to arbitration seeking inter-alia 20% loss of profit @ $131,000. (note: this is 20% of $655,000.00 i.e. the total worth of contract as Rotomould would highlight).	
21/06/11	DCDCL email to Architect	Referring to Architect email of 20/06/11 and telephone conversation between DCDCL & Rotomould. 
Noting Gordon Jenkins has been hired by Architect to assess DCDCL claim. Seeking permission to furnish Jenkins with DCDCL invoices for materials on site.	
07/07/11	Letter from Rawlinson Jenkins Ltd to Rotomould	As requested, we have prepared an assessment of the value of work carried out by Deo Construction Development Co Ltd on site and present this to you as follows:
Itemised valuation totalling
$11,730-00
We note that we did not visit the site and our estimate is based on our discussion and information given to us.
We trust the above is sufficient for your purpose, however if you require further information, comments or details please do not hesitate to contact us.	
13/07/11	Letter from DCDCL to Architect	In response to your letter, we are very much concerned that this issue has prolonged for quite some time without reaching any conclusion. We acknowledge your part in providing us with a certificate of Payment No.1 to which we have not received any settlement to date.
Since you have engaged for an independent Q.S to carry out final assessment without giving us the opportunity to deliver our statement, we see this as an unjust measure on your part and you actions were carried out in an unprofessional way.
We are forwarding a letter to the President of Fiji Association of Architects with a brief story to the project.
Once again we remind you to refer to Fiji Standard Form of Building Contract without quantities private edition 1978 Clause 33 which states that disputes or differences be referred to arbitration and final decision of person to be agreed between the parties or failing agreement within 14 days after either party has given to the other a written request to concur in the appointment of an Arbitrator appointed on the request of either party by the President or a Vice-President of the Fiji Association of Architects.
A copy of this submission will be diverted to Gordon Jenkins as well.
We trust that common sense and transparency will prevail.	
14/07/11	Email from Rotomould to Architect	"This is to acknowledge receiving the QS report forwarded by you. Unfortunately the day I received the report, I flew out of the country and did not have time to discuss it with you. I will deliberate on it when I am back in the office on 19/7 and action the needful. I see no reason as to why Vimal Hire should have been allowed to present anything to QS as you did not allow me to present my version on the claim. This has maintained impartiality on the part of QS as Vimal Hire had demanded us to hire a QS to maintain impartiality of the report.
Before leaving for NZ I had discussed Deo Hire issue with my solicitor Lateef and Lateef and he will soon institute legal proceedings to claim for substantial losses I have sustained because of the breach of contract. The question is who should be paying whom. If Deo Hire is happy to sort this issue amicably I am more than happy to do so.	
20/10/11	Letters (3x) from Agape Construction & Quantity Surveying Consultants to AK Lawyers	Reports for on-site and off-site expenses for all related works and purchase of materials carried out by DCDCL as stipulated below:-
(Profit & Margin 0f 20% added)
	
15/11/11	Letter from AKL (DCDCL Lawyers) to Lateef (Rotomould Lawyers)	We refer to the above matter.
We confirm we act for our client DCDCL and that you have been appointed by Rotomould..to act on act on their behalf in this matter.
We are instructed by our client that Rotomould entered into contract for the construction of a warehouse and office on Queens Road, Lautoka. Rotomould hired Design Hut …as their Architects. The contract was executed on 6th December 2010.
Rotomould insisted, and subsequently made the completion date of 4th July, 2011 an essential term of the contract (being 26 weeks from the commencement date).
Our client has advised our office that works commenced as per the said agreement. On or about 11th Janaury 2011, LRLA..shut down all operations due to plans not being approved. This resulted in delays of over 4 months.
On 23rd May 2011, Rotomould through their Architect issued a termination letter to our client. As a result of the above our client has suffered significant damage. It is clear through the documents disclosed to us that there have been numerous breaches by Rotomould and the Architect. Some of the breaches include, but is not limited to, failure to give uninterrupted possession of site, failure to provide approved drawings, details and information, failing to extend time for completion, failure in issuing payment certificates, failure to attend to payment of interim payment certificates, unlawfully and without reasons/grounds terminating the contract and failure in allowing an opportunity to our client tobe present before the Quantity Surveyor (who Rotomould engaged).
Our client now claims as minimum $187, 267.69…..plus commercial interest (13.5% per annum) as compensation for damages suffered made up as follows:
……………………………
Our client further reserves the right to claim for other losses and/or damages should this matter not be settled.
We now allow 14 days from the date of this letter to settle the claim under this demand. In the event of a failure to pay the claim, our client intends to move to Arbitration in accordance with clause 33 of the Fiji Standard Form of Building Contract incorporated into the contract.
If your client disputes the claim and does not pay as demanded we now list a number of Arbitrators who would be acceptable to arbitrate.
…………………….
Please take this as a formal request under clause 33(1) effective immediately on receipt of this notice. Unless we are advised of agreement as to the Arbitrator within 14 days of receipt hereof, our client will proceed to require the President or Vice President of the Fiji Association of Architects to appoint the Arbitrator.	
09/12/11	Letter from AKL to President, Fiji Association of Architects		
09/12/11	Email from Lateef (Rotomould lawyer) to AKL (DCDCL Lawyer)	Please withdraw as we met our client and are in the process of responding, part of which is the possible appointment of Peter Rankin as the Arbitrator if our clients proposed without prejudice offer is not accepted.	
12/12/11	Letter from Lateef to AKL	Asserting inter alia as follows:
•	Rotomould disputes DCDCL claim
•	The contract was not at all performed, nor was it ever effectively commenced or established as required.
•	Architect brought this to the attention of DCDCL some 8 weeks after the proposed date fo commencement at the site meeting of 02/02/11.
•	DCDCL showed no interest in commencing the work req'd despite the Architects request.
•	DCDCL unilaterally and incorrectly attempted to vary the contract.
•	DCDCL informed Rotomould that due to price increase his initial contract price could no longer stand. Our client and Architect refused this unreasonable variation.
•	Deo and his wife visited our client at his home and informed him that it may be best for our client to engage another contractor.
•	It was after this that Rotomould informed Architect who then terminated the contract with your client as fundamentally DCDCL was no longer interested in performing the contract, for reasons best known to him.
•	The approvals of the plans had nothing to do with the reason fr termination as DCDCL had not properly started the work required of it and took 8 weeks to only partially establish the site for construction.

Before (Arbitration, we can resolve this matter) and as conveyed to you, we have $11,730-00 in our trust account to pay your client being the amount assessed by the Independent Assessor…..Our client is willing to pay an extra $2,000.	
21/12/11	Letter from Fiji Association of Architects to AKL	Acknowledging AKL letter and advising Arbitrator will be appointed soon.	
18/01/12	Letter from Lateef to AKL	Seeking response to 12/12/11 letter.	
25/01/12	Letter from AKL to Fiji Assoc of Arch	Follow up on 21/12/11 letter.	
26/01/12	Letter from Fiji Association of Architects to AKL	Advising that FAA has appointed Fraser Clark. Advising that parties should now correspond directly with Clark.	
03/02/12	Letter from AKL to Lateef	We decline your offer and would want to proceed to arbitration.	
14/02/12	Letter from AKL to Lateef	Attaching terms and costs of Appointed Arbitrator as submitted by FAA. Costs to be shared equally. Also attach Form 2 (Schedule 1) of Arbitration Act. Rotomould to execute Form and submit to AKL.	
20/02/12	Letter from Lateef to AKL	Caesar is out of Fiji and will be back 29/02/12.	
24/02/12	Email from Clark to Lateef and AKL	…I have not rec'd any communication from Rotomould and will be unbale to proceed with Arbitration unless I do so within 7 calendar days of this email.	
24/02/12	Email from AKL to Clark	Lateef still out of country and will return 29/02/12. If they do not act expeditiously upon his return, we may ask Arbitrator to proceed anyway or we'll seek Court Order for specific performance to get them to arbitration.	
05/03/12	Appointment of Single Arbitrator		
06/03/12	Letter from Lateef to AKL	Enclosing Appointment of Single Arbitration under Agreement to Refer Future Differences to Arbitration, Form 2 (Schedule 1) in accordance with the Arbitration Act duly executed by our client as requested.
(Form is dated 05/03/12)	
08/03/12	Letter from AKL to Lateef	Clark had previously extended deadline to 09/03/12 but we are still awaiting your response to Clark and your submission to "Appointment of a Single Arbitrator". We have already executed the said document.	
12/03/12	Email from AKL to Clark	We confirm receipt of From 2 (Schedule 1) of the Arbitration Act Cap 38 duly executed by both parties. We received the said Form on the 9th of March 2012. Please find attached our letter (see below) to you enclosing the said Form.	
		Letter ref'd to above read as follows:
We refer to the above matter and our previous correspondence via email.
Please find attached Form 2 (Schedule 1) duly executed by both the above mentioned parties…consenting to you as the appointed Arbitrator.
In the interest of providing assistance we now supply brief facts pertaining to this dispute.
The parties entered into a contract for the construction of a warehouse and office on Queens Road, Lautoka. Rotomould hired Design Hut as their Architects. The contract between the parties was executed on 06th December 2010.
Rotomould insisted, and subsequently made, the completion date of 4th July 2011 an essential term of the contract (being 26 weeks from the commencement date).
Works commenced as per the said agreement. However, or or about 11th January 2011, LRLA shut down all operations due to plans not being approved. This resulted in delays of over 4 months.
On 23rd May 2011, Rotomould through their Architect issued a termination letter to our client. As a result, our client (DCDCL) suffered significant damage. Our client alleges numerous breaches against Rotomould and their Architect. Some of these breaches include, but are not limited to, failure to give uninterrupted possession of site, failure to provide approved drawings, details and information, failing to extend time for completion, failure in issuing payment certificates, failure to attend to payment of interim payment certificates, unlawfully and without valid reasons/grounds terminating the contract and failure in allowing an opportunity to our client to be present before the Quantity Surveyor (at the time of assessing works completed – hired by Rotomould).	
27/03/12	Email from Clark to parties	I am preparing terms and conditions for the conduct of the arbitration and need you to submit to me all relevant documentation i.e. the signed agreement 6.12.10 and all contract correspondence relating including the LRLA notices and dated photographs if available. It is imperative that both parties submit ALL documentation that they consider relevant at this stage. 
In order to progress this matter I request that the submissions reach my office than Thursday 5 April – if you are unable to meet this date please advise the earliest possible alternative date.	
28/03/12	Email from AKL to Clark	We take that your reference to "submissions" do not relate to formal written submissions. We trust this means disclosure of documents pertaining to the agreed matters of dispute.
We sill submit the said documents by Thursday 5th April however please note that I will be away overseas from 5th of April till the 12th of April.
Could further directions (after submissions of these documents wait till after my return?	
28/03/12	Email from Clark to AKL	You are correct – "We trust this means disclosure of documents pertaining to the agreed matters of dispute". And yes, your absence 4/4 to 12/4 will have not be a problem.	
01.04.12	Letter by Metal Works & Joinery Ltd	Sent to Rotomould to say they'd inspected grade of steel used by DCDCL (G300) not the specification Project Engineer had req'd (G500).	
03/04/12	Email from AKL to Clark, Lateef, DCDCL, Rotomould	Recent weather resulted in businesses being inoperable since last Friday. Not having full staff attendance. Seeking extension to 19 April to attend to submissions.	
03/04/12	Email from Clark to AKL, Lateef, DCDCL, Rotomould	Extension of time agreed in light of current circumstances.	
03/04/12	Letter from Lateef to Clark	Enclosing all documentation that Rotomould will rely on @ Arbitration.
Note: item 12 on list reads:
"Oral evidence if required by our client and Mr. Sanjay Patel of Design Hut"	
05/04/12	Deadline set by Arbitrator for submission of documents.		
19/04/12	Extended deadline for submission of documents.		
September 2012	Deadline for submissions.		
14/09/12	Lateef Submissions dated 14/09/12	Raises following inter alia:
•	LRLA (stop work notice that DCDCL claims) refuted by Rotomould. Letter from LRLA annexed tending to confirm the same.	
24/09/12	AKL Submissions filed before Arbitrator		

Appendix 2

Date/ Time Email Sent	Sender	Recipient(s)	Message	
12/03/13
3.37 a.m.	Clark	Lateef/AKL	Telling parties that he will entertain no further correspondence/discussion as Award already handed down.	
12/03/13	AK Lawyers	Clark/Lateef	Acknowledging above.	
23/08/12
10.06 a.m	Lateef	Clark/AKL	"Noted, but Fraser shouldn't the parties be entitled to verbally submit as per all Arbitrations?"	
18/08/12
4.29 p.m.	Clark	Lateef/AKL	My apologies if I have not made myself clear.
When I requested written submissions I was expecting the clear exposition by both parties of their position either as evidenced by the relevant correspondence or by way of a summary argument of the respective positions from which I will review submissions in accordance with the contract between the parties and make my ruling. There will be no verbal submissions. If you feel you have not yet explained your position fully in the contractual correspondence previously submitted I will allow a further 4 weeks for you to do so but in the mean time I am continuing to review what you have previously submitted.	
14/08/12
3.50 p.m	Lateef	Clark/AKL	"We will require an audience with the Arbitrator in order to make verbal submissions some time in mid September and can hand in written submissions simultaneously".	
14/08/12
3.13 p.m.	AK Lawyers	Clark/Lateef	"In addition to [submitting all relevant documents]..we need to address you in tying up the documents, providing explanations and assisting with legal issues which I believe is necessary as the documents in isolation will lack this.
A pre-stated directions would have helped. However, this can still be overcome by the parties addressing you by way of submissions and if you require further oral hearing to clarify evidential matters. You would have noticed numerous emails requesting "directions" so that both parties would have become aware of the process you wished to employ.
Unfortunately, a further 7 days to provide comprehensive "submissions" is not adequate. We would require at least 14 days for both parties to direct you on legal principles and factual applications to those principles.
We now await your directions on the time sought and advice of the process you will be relying on going forth up to hearing stage (if you choose to hold one)"	
13/08/12
9.50 a.m.	Clark	AKL/Lateef	"I am continuing to review the documents supplied. If either parties feels that "there are issues that both parties need to address which the documents do not necessarily allude to" they should advise me immediately as my request for written submission/supply of relevant documentation was intended to cover all matters to be reviewed. The process does not allow for "drip fed argument" which could unnecessarily drag out the process.
I will allow a further 7 days to submit any relevant information that you do not feel was covered adequately in your earlier submissions"	
08/08/12
9.16 a.m.	AK Lawyers	Clark/Lateef	Since parties have attended to disclosure of bundle of documents & payment of services rendered thus far – request for both parties to either file written submissions or present oral submissions…"as there are issues that both parties need to address…[and] the parties [need to] direct the Arbitrator as to the legal position and authorities that may assist in determining this matter".
"Could you kindly advise as to future directions and especially in regards to our request for submissions…"	
03/07/12
8.50 a.m.	Lateef	AKL/Clark	Needing at least 3 weeks' notice for verbal submissions.	
03/07/12
9.41 a.m.	Clark	AKL/Lateef	(relevant page missing from Affidavit)	
03/07/12
12.23 p.m	AK Lawyers	Clark/Lateef	Supporting Lateef proposal	

Appendix 3

(The Award)
1.	That a contract to construct a factory for the Company on Lot 1, N.D. 2853, Queens Road, Lautoka was entered into by both the Company and the Contractor as per the drawings and specifications prepared by Design Hut (The Architect) by virtue of a letter of acceptance issued by the Architect on 6 December 2010.

2.	The Architects letter dated 6 December 2010 stated that:-

•	The site would be available from 8 December 2010.
•	That commencement date would be 3 January 2011
•	That completion date was to be 4 July 2011 – 26 weeks construction period.

3. At the time of the issuing of the letter of acceptance, 6.12.10, there was no approved building permit issued by Lautoka Rural Local Authority (LRLA) – the appropriate authorising agent.

4. It would be illegal to commence construction on site in the absence of a Building Permit from LRLA, rendering the time conditions stipulated in the Contract unenforceable.

5. Extensions of Time were entitled to be issued under the terms of the Contract up to the date of the issuing of the LRLA Building Permit, which was 28 April 2011 with a new completion date of 27 October 2011 (which was week 16 of the original contract period), effectively making the Contract 42 weeks.

6. Notwithstanding the non-issuance of the Building Permit, the Contractor being aware of the Companies desire to occupy their new factory at the earliest opportunity attempted to mobilise on to the site in early January 2011 to cooperate and assist the Company i.e. in good faith. 

7. Early January 2011 was a period of sustained heavy rain throughout Fiji and the Contractor notified the Architect of their inability to make progress on site.

8. The Contractor purchased materials (e.g. steel reinforcing) and began off site fabrication of these in an effort to make up for lost time due to rain.

9. The Contractor checked the progress of the Building Permit with LRLA who, knowing that there was no Building Permit issued, "advised" against any work being done on site, for obvious reasons.

10. The drawings prepared by the Architect note the steel reinforcing was to be 12dia, 10dia, 16dia bars typically.

11. In the Fiji Construction Industry reference to 12/10 reinforcing would in general denote grade 300 bars i.e. D12, D10. If a higher grade was required this would be denoted by HB12/HR10 etc. 

12. The Contractor purchased D12 bars and made up cages etc. using these.

13. No specific Structural Engineers drawings were included in the Contract Set/Contract Agreement.

14. From other correspondence we understand that Shri Singh & Associates were to be the Structural Engineers.

15. No "Standard Cover Sheet" for Structural works was included in the Contract Agreement. This sheet would typically define what grades of steel were to be used on a project i.e. normal grade, high tensile steel etc.

16. It is evident that some form of photographic review of actual ground condition during the period Dec-January (but these have not been provided by either party) was supplied to the Structural Engineer (the Engineer) who subsequently advised a change to the footing details which was sent on 3/2/11. This increased the number of bars but no change was made to the designation i.e. D12 bars were still referred to 

(The photos this decision to change the details from has not been provided to the Arbitrator despite requests).

17. After the Architects "Termination of Contract" letter was submitted 23 May 2011, the Contractor submitted a claim for the labour and materials involved in the preparation of steel reinforcing cages. This was rejected by the Architect on the report of the "new contractor" who advised that the cages were not the "correct" grade steel. I find noreference to a change of grade to the reinforcing steel was given to the Contractor and that in accordance with the wishes urging the Company he had mobilised and purchased in good faith the reinforcing steel.

18. Frustration at the lack of progress on site by Rotomould is evident in the exchanges of communication and at some stage the Contractor and the Company met privately to discuss this and acknowledged that their mutual concerns could not be solved by progressing with the Contract and that the Contract should be terminated with fair payment for works carried out to date.

19. At this point disagreement have arisen as to what would be 'fair remuneration for works done to date'.

20. The Company has declined to pay for steel reinforcing on the grounds that it did not conform to the contract but (see Arbitrators comments 17 above), the documents did not call up HB Steel but refer merely to diameter size which implies D type (Clause 11).

21. The Company was of the view that Contractor has not proceeded diligently and consistently on site.

22. The Contractor was of the view that he was initially prevented from proceeding because of wet weather. The Contractor then became aware that there were problems with the subdivision, part of the reason the LRLA Permit was not issued until this was resolved and that there was no Building Permit meaning that any work on site was illegal and would be subject to a "stop work notice". Being a responsible builder he was reluctant to proceed on site in such circumstances. The contractor believed that Extensions of Time should have been granted accordingly. 

23. The Contractor also noted the introduction of an increased Value Added Tax from 12.5% to 15% and was of the view that this constituted a valid increase in the contract sum.