United Nigeria Insurance Co. Ltd Vs Leandro Stocco (1973)
LawGlobal-Hub Lead Judgment Report
O. ELIAS, C.J.N.
This is an appeal against the judgment of Dosunmu, J., in the High Court of Lagos delivered on September 28,1970 in which the learned trial Judge granted the plaintiff leave to enforce the award of John Graham Bentley, dated June 24, 1970 in the sum of 25,000pounds (N50,000) and dismissed defendants’ application to have the said award set aside or remitted back to the arbitrator.
The facts of the case were as follows:
“By virtue of a contract of insurance under Personal Accident Policy No. PA. 60007/FRO entered into between the plaintiff, a registered medical practitioner in Nigeria, and the defendants, an Insurance Company Registered in Nigeria, the amount insured was 50,000pounds payable to the plaintiff or his representatives in the event of his death or permanent disablement arising from injuries as set out in the schedule to the policy. That schedule also contains provisions for compensation payable in respect of lesser but specified bodily injuries in accordance with the scale therein set out. There is also a provision in item 2 (B) (d) to the effect that “where any bodily injury not mentioned herein however shall be sustained, a percentage of permanent disability will be fixed which in the opinion of the company is consistent with the above scale of fixed percentages.”
On April 11, 1969 the plaintiff sustained bodily injuries as a result of a car accident, and described the nature of those injuries in his evidence before the arbitrator; and both sides agreed that they come within a class not specifically mentioned in the schedule so that they fall to be dealt with under item 2 (B) (d). The plaintiff made a 100 percent claim for compensation, but the defendant company offered him a 30 percent disability amounting to 15,000pounds which he refused. In accordance with the provisions of the contract of insurance, the parties agreed to appoint Mr. J.G Bentley, a legal practitioner, as sole arbitrator, on the nomination of the defendant company. The relevant portion of the submission to arbitration reads as follows:
“We the undersigned parties by our solicitor hereby agree that our difference and disputes in respect of the compensation payable under Personal Accident Policy PA.60007/FRO shall be referred to JOHN GRAHAM BENTLEY ESQUIRE Legal Practitioner of 47 Marina,Lagos, as arbitrator in accordance with condition 7 of the policy and the provisions of the Arbitration Act, Cap. 13”
The submission also provides that, if either party should fail to attend the proceedings after reasonable notice, the reference could proceed ex-parte; and there were agreements as to payment of the arbitrator’s fees and about award of costs against the unsuccessful party. Both sides duly appeared before the arbitrator on May 14, 1970, and gave oral as well as documentary evidence. The plaintiff called medical experts including one Dr. Bailey, a Senior Surgical Specialist, tendered many documents including the policy of insurance and a number of medical examination reports and opinions of certain doctors who did not give evidence but who had examined the plaintiff at one time or another since the accident. The representatives of the defendant company also testified. After hearing addresses by counsel on both sides on June 20, 1969, the arbitrator adjourned his decision to June 24, 1970 when, after reciting the material facts placed before him, he published his award as follows:-
“(l) I assess and award the compensation which the claimant is entitled to recover from the respondent under the policy at the sum of 25,000pounds Nigerian Currency.
(2) I further award that the respondent shall bear and pay its own and the claimant’s costs of the arbitration and award at the sum of 525pounds plus the costs of stamping the award (if incurred).”
When, by July 14, 1970, the defendants had failed to comply with the award or to take steps to have it set aside, the plaintiff took out an originating summons for leave to have the award enforced as a judgment of the High Court of Lagos State. At the mention of this summons on July 20, 1970, the defence counsel asked for adjournment of its hearing to enable him file a motion on notice to have the award set aside. The adjournment having been granted, defence counsel filed the notice on August 4, 1970, and both the summons and the motion were taken together by the learned trial Judge.
Plaintiff’s counsel submitted that the defendants’ application was filed out of time since Order 49, rule 13 of the High Court of Lagos (Civil Procedure) Rules enjoins that an application to set aside an award must be made within 15 days after its publication. The learned trial Judge rejected the defence counsel’s submission that Order 49, rule 13 deals only with a reference to arbitration by an order of court in a pending suit and not a submission by agreement of parties; the Judge also drew attention to Section 3 of the Arbitration Act which provides that “a submission, unless a contrary intention is expressed therein, shall be irrevocable except by leave of the court or a Judge or by mutual consent, and shall have the same effect in all respects as if it had been made an order of the court.” The defendant company had failed either to explain the delay or to ask the court for an extension of time. This should have disposed of the defendants’ application, but the learned trial Judge went on to consider the application on the merits.
The learned trial Judge then considered the defence counsel’s submission that the award was rather sketchy in form and that the arbitrator should have included his reasons for making it, and that, in particular, he should have specified what his findings are on the point of law and the facts raised in proceedings before him. The learned trial Judge rejected this submission on the ground that the essence of an award is that it should be clear and unambiguous and that it should determine all the differences submitted to the sole arbitrator chosen by both of them: Wood v. Hothan 51 ER 286; Jay v. Byles (1833) 3 MOO 8586.
The learned trial Judge next turned to an examination of the other grounds of defendants’ application, namely, misconduct of the proceedings by the arbitrator and error of law on the face of the award. The allegation of misconduct is that the arbitrator had fixed the compensation of 25,000pounds arbitrarily, and that he had failed to decide all the matters which were referred to him. The defence counsel contended that the arbitrator had failed to construe the policy of insurance and in particular that the arbitrator should not have accepted the evidence of Dr. Bailey which, he contended, was given without any relation to the schedule to the policy. The learned trial Judge pointed out, however, that both in the proceedings and the evidence, the plaintiff claimed that he was entitled to 40,000pounds as compensation, but the defendants offered only 15,000pounds.
During the proceedings Dr. Bailey had assessed plaintiff’s disability as 80 percent, while other doctors put it at 100 percent. In any case, the defendants failed to call any medical evidence as to the plaintiff’s disability and insisted on 30 percent disability on so called “available medical evidence,” claiming that the assessment was based on a particular provision in the schedule.
The arbitrator, no doubt after weighing all the evidence before him, awarded 25,000pounds which works out at 50 percent disability, a percentage that is consistent with the scale of fixed percentages in the schedule to the policy.The arbitrator had accordingly decided the one point in dispute between the parties, namely, the amount of compensation to be paid to the plaintiff, and there is nothing left for the arbitrator to decide: Ingram v. Milnes 103 E.R. 414. The learned trial Judge, therefore, considered defence counsel’s submission that the arbitrator had failed to construe the policy of insurance as an unfair one. The parties did not set him that task, although it is clear that since the policy was put in as evidence, the arbitrator must have considered it along with all the other items of evidence before him. The provision in the schedule which gives the defendant company the discretion to fix an assessment of disability must surely be taken to mean that it must be supported by evidence.
The learned trial Judge also dismissed defence counsel’s further submission that, even if the arbitrator had construed the policy of insurance in his award, he had not construed it in accordance with what he called ‘principles of construction”, which counsel failed to elaborate or specify.
Also dismissed is learned counsel’s contention that the plaintiff did not disclose in the policy of insurance whether he was a surgeon or a physician or a general practitioner. He held that it was not for the arbitrator to make express findings on such matters, but that it could be reasonably assumed that he accepted the evidence that the plaintiff’s future as a surgeon was at an end, though he could still carry on as a general practitioner or physician and that that was why the arbitrator awarded 50 percent disability, especially as there was evidence before him that a registered medical practitioner in Nigeria is both a physician and a surgeon. It was the view of the learned trial Judge that the alleged error of law claimed by the defence counsel must appear in the award itself before it could be set aside or remitted to the arbitrator. While there is no doubt that construction of document is a question of Law, the error must be shown to appear on the face of the award itself. The learned trial Judge accordingly granted plaintiff leave to enforce the award of the arbitrator in the sum of 25,000pounds as if the same were the judgment of the High Court of Lagos, and dismissed the defendant company’s application to set aside or remit the said award.
Against this decision, the defendant company has appealed to this court on the following grounds:
“(1) The learned Judge erred in law and in fact by holding that the application to set aside or remit the award was out of time because the provisions of Order 49,rule 13 of the High Court Rules clearly does not apply in this case and the cases relied upon are different from the one under consideration before him.
(2) The learned Judge misdirected himself in law and in fact by holding that there was no misconduct on the part of the learned arbitrator and by stating that the examples of misconduct do not include the arbitrary fixing of 25,000pounds as an award when the said examples were not exhaustive but are intended to be taken to act as guides.
(3) The decision of the lower court is wrong in law and in fact, in that having regard to the pleadings and the submissions made, the learned arbitrator omitted to decide vital matters submitted to him regarding the true construction of the policy, the burden of proof and whether or not the insured discharged the burden on him as required by law.
(4) The lower court misdirected itself in law and in fact by saying:
‘In the light of these authorities, I do not join in the criticisms as to the form and contents of the award in that it does not state the point of law and facts raised at the proceedings before the arbitrator.’
In that from the pleadings and submission made, it is clear these points were raised and the arbitrator is required by law to decide them.
(5) The learned Judge misdirected himself by holding that:
‘At the end of the day, the arbitrator fixed the compensation at 25,000pounds. This apparently works out at 50% which is a percentage consistent with the scale of fixed percentages in the schedule to the policy…’
What the arbitrator has fixed is certainly not inconsistent with the scale of fixed percentages in the schedule which vary from 100% to 2% because this certainly is not what the policy intended but that the percentages specifically providing for the various disabilities in the schedule shall be used as the basis of assessment in respect of disabilities not specifically provided for.
(6) The learned Judge also erred in law and in fact by holding that the construction of the policy agreement was not specifically referred to the arbitrator to be construed when the claim was based on that policy agreement as agreed by the parties and their rights can only be decided on the said policy agreement as referred to in the pleadings and the submission before the arbitrator.
(7) The learned Judge also misdirected himself in law and in fact by saying that:
‘Even if the policy did provide that compensation in all other cases not specifically mentioned in the schedule should be exclusively the opinion of the defendant, I have my reservation as to whether this is what it provides, such opinion must be backed up by evidence.’
In that there was evidence in this respect before the arbitrator consisting of the testimony of both parties that the claim is based on the policy which was tendered in evidence and admitted before him, and it accordingly as he was required by both parties so to do in accordance with the principles of construction.
(8) The court below went into error in law and in fact by granting leave to enforce the award having expressed some doubt in that the court should not grant leave to enforce an award in doubtful cases but should leave a party to his remedy by action in such cases.
(9) The learned Judge went into error in law and in fact by holding that the claim of the insured is ‘irresistible’ when on the evidence before him and the law, the contrary is the case.
(10) The learned Judge misdirected himself in law and in fact stating that an award cannot be set aside on the ground that the arbitrator did not construe the policy agreement made by the parties based on the claim before him and thus determine their rights accordingly when in law he is required to do so instead of wrongly proceeding arbitrarily to fix compensation at 25,000pounds and thereby purporting to make an agreement for the parties.
(11) The decision is against the weight of the evidence.’
Mr. Sofola, learned counsel for the appellants, in arguing ground 1, contended that their application was not made out of time as found by the learned trial Judge since, according to him, Order 49, rule 13 of the Lagos High Court Rules must be read subject to Order 49, rule 1 which says that parties desirous of referring a matter in difference to the arbitrator, may do so at any time. He further contended that, under the Arbitration Act itself, there is no provision setting out any time-limit within which an application to set aside an award ought to be brought, and that Section 12 of the Act sets no time-limit to cases arising within the Lagos State. We think that there is no merit in this argument and that the learned trial Judge is right in applying Order 49, rule 13 of the Lagos High Court Rules in holding that the application was out of time.
In the very recent case of Middlemiss & Gould (a firm) v. Hartlepool Corporation (1972) 3 WLR 1643 which involved the enforcement of an arbitration award as a judgment of the High Court in England, the claimants, wishing to be paid applied to the court under Section 26 of the Arbitration Act 1950 for leave to enforce the award in the same manner as a judgment to the same effect in the High Court. The arbitrator did not hold a hearing, so that there were no witnesses and no lawyers appearing before him; he considered the matter merely on the papers submitted to him, and decided in favour of the claimants and awarded a stated sum of money. Lord Denning, MR., held at p. 1646:
“If the corporation wished to challenge that award, they should have brought it up to the High Court within six weeks (see RSC Order 73, r. 5 (1)). They did not do so. So it became and was a final and binding determination of the matters between them.”
Later still, Lord Denning observed at p. 1647:
“In this case there is no possible ground for doubting the validity of this award. The corporation thinks that there is a point of law which has been wrongly decided. But that does not make the award invalid. If a point of law has been wrongly decided, the corporation should have brought it up to the High Court on the case stated. As it has not been brought up, the award is final and binding. It should be enforced.”
Mr. Sofola next argued grounds 2 and 3 together maintaining that the learned trial Judge should have construed the contract in accordance with the schedule which gives the Insurance Company the discretion (which, according to Mr. Sofola, is absolute) to decide the percentage of assessment in cases of injuries not listed in the schedule. It was his view that the arbitrator did not show in his award that he specifically referred to the relevant percentages set out in the schedule, and that the issue for determination by the arbitrator was narrowed down in the defence letter (Exhibit A) in which the matter for determination was the interpretation of item 2(A) and (B) of the schedule to the policy. Mr. Sofola further contended that in entering into the contract, plaintiff claimed to be a medical practitioner, not a surgeon and that, as such, if he could not use a particular part as a surgeon, he should have taken out a different type of policy from the one he did take in the present case. In arguing these and the other grounds, much the same arguments as had been canvassed before the learned trial Judge were advanced before us, and we do not think it necessary, in the light of the analysis which we have attempted above, to repeat the various contentions. It seems to us that the gravamen of the grounds of appeal, other than ground 1, amounts to the allegations that the arbitrator is guilty of misconducts of the proceedings and that he has committed an error in law in making his award, issues that, in our view, have been rightly disposed of by the learned trial Judge.
Mr. Coker, learned counsel for the respondent, for his part submitted that the arbitrator’s award is a fair one and that the learned trial Judge was right in granting leave for it to be enforced as a judgment of the High Court of the Lagos State.
We think that too much has been made by the learned counsel for the appellants of the fact that the learned trial Judge had failed to construe item 2(A) and (B) of the schedule because it was not specifically mentioned in the award. On a similar contention in the case of Middlemiss v. Hartlepool Corporation cited supra. Lord Denning held at p. 1647 as follows:
“He contended that the arbitrator had only decided the way in which the certificate should be calculated. It is true that the arbitrator did not expressly say anything about paragraph 25(4) (d) in his award. But the point was distinctly raised by the corporation in paragraph 11 of their defence. By implication the arbitrator rejected their contention. He held that the money was payable despite paragraph 25(4)(d). It is therefore res judicata. It falls within the principles stated in many cases from Henderson v. Henderson (1843) 3 Here 100, to Didelitas Shipping Co. Ltd. v. V/0 Exporchleb (1966) 1 QB 630. If a point is raised for decision and by implication has been decided, that is final. The parties cannot be allowed thereafter to reopen it. This has been applied to arbitrations. It is stated In Russell on Arbitration. 18th Ed. (1970), p. 277:
‘The award will be sustained even though the arbitrator has omitted to notice some claims put forward by a party, if, according to the fair interpretation of the award, it is to be presumed that the claim has been taken into consideration.’
So here, the arbitrator had clause 25 (4) (d) before him, but nevertheless, he ordered that this sum was to be paid by the corporation. It should be enforced as a judgment. Leave should be given.”
In the same case, Edmund Davies, L J., held, also at pp. 1647-8, as follows:
“When parties to a dispute submit to having it decided by an arbitrator, two consequences flow from the making of his award. First, unless there is an express contrary provision in the arbitration submission or unless it is only an interim award, it operates as a final and conclusive judgment…. The second consequence, and for present purposes the more directly relevant one, is that the award constitutes a final judgment upon all matters referred to the arbitrator. There is ample authority, both old and new, for this proposition. I propose to refer briefly to only two decisions which have stood for many years. In Wood v.Griffith (1818) 1 Swan.43,Lord Eldom LC said,at p.52:
‘It is extremely clear that every award must be certain and final; but it has, particularly in more modem times been considered the duty of the court, in constructing an award, to find that it is certain and final; and instead of leaning to a construction, which in effect would destroy nine-tenths of the awards made, if possible to put one consistent sense on all the terms.”
And in Harrison v. Creswick (1853) 13 Q.B. 399, Parke B. said, at p.415:
“…..the only question, therefore, is whether the arbitrator has not by his award impliedly, if not in express terms,finally disposed of the matter. The rule as laid down in the notes to Birks v. The Trippett. 1 Wms. Saund. 33 (a) is that, where an award professes to be made de premisses, ‘Even where there is no award of general railbuses, the silence of the award as to some of the matters submitted and brought before the arbitrator, does not per se prevent it from being a sufficient exercise of the authority vested in him by the submission. An award is good, notwithstanding the arbitrator has not made a distinct adjudication on each or any of the several distinct matters submitted to him, provided that it does not appear that he has excluded any.’
Parke B. then cited a number of reported decisions supporting that approach, and concluded:
‘Where an award is made de premisses, the presumption is that the arbitrator intended to dispose finally of all the matters in difference; and his award will be held final, if by any intendment it can be made so.”
We think that the learned trial Judge was right in holding that the application was out of time under Order 49, rule 13 of the High Court of Lagos (Civil Procedure) Rules; and that even if we were to hold otherwise, the arbitrator’s award has disposed of all the points of claim and of defence submitted to him and that his judgment is final and binding on both parties.
We consider it unnecessary for the award to have referred to specific items of the schedule to the policy or to have contained an elaboration of the statutory construction placed by the arbitrator upon the particular clauses mentioned by counsel for the appellant company. The award must be deemed to have impliedly disposed of all matters referred to the arbitrator, since the award is clear and unambiguous in its terms and deals with the only issue in controversy, that is, the amount of compensation payable to the respondent under the policy of insurance.
We are, therefore, of the opinion that the application is statute-barred and that, even when considered on its merits, the appeal must be dismissed and it is hereby dismissed. We confirm the judgment of Dosunmu, J., delivered on September 28, 1970 in the High Court of Lagos, including the order as to costs. We award to the respondent cost assessed as N120 in this appeal.
Other Citation: (1973) LCN/1761(SC)
