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.