Preview Page SAR 2002 - 1
Subject matter:
Misconduct of arbitrators.
Finding:
The arbitrators have applied pressure to the parties to agree to a
cancellation or commitment fee, constituting misconduct in terms of
s44(a) of the Commercial Arbitration Act 1984.
Parties:
Claimant: Sea Containers Ltd (Australia)
Respondent: ICT Pty Ltd (Australia)
Place of Court Proceedings:
Sydney, Australia
Applicable law:
New South Wales Commercial Arbitration Act 1984
EXTRACT FROM THE JUDGMENT
This appeal involved a challenge to the validity of an order removing
certain arbitrators after matters were referred to them under the terms of
shipbuilding contracts between the parties. The respondent had applied for
the order pursuant to s44 of the Commercial Arbitration Act 1984 (the
Act) upon the grounds of apprehended bias on the part of the arbitrators
and misconduct of the arbitrators in pressing the parties to agree to the
payment of cancellation fees. At first instance, Gzell J found that the three
arbitrators should be removed.
Before the trial Judge the respondent had contended that the arbitrators
had misconducted themselves by repeated demands for cancellation fees
and by pressuring the parties to agree to the payment of such; by declining
to make orders unless the parties acknowledged an obligation to pay the
fees; and by the fixing of a final hearing date without adequate notice to
the parties and without hearing from the parties. This misconduct was such
