Puzzles for arbitrators
Here is no.7 in our series of puzzles for arbitrators. Why not try your hand, and brain, at a solution? Suggested answers, if not too long, will be printed in the next News & Views.
Puzzle no.7
You have been appointed Arbitrator by the President of RICS. On receiving notification of your appointment, the Respondent immediately objects on the basis that the commencement date was out of time. The facts are as follows:
(a) The Architect issued a Final Certificate on 1 April, which was received by the Employer, and the Contractor received its copy on 2 April. The contract includes clauses whereby the Final Certificate is conclusive of all relevant matters unless ‘arbitration or other proceedings have been commenced by either party within 28 days after the Final Certificate has been issued’.
(b) On 20 April (received on 21), the Claimant Contractor issued a notice as follows: ‘We are clearly in dispute as regards extensions of time, payment of our loss and expense, the amount of the final account and your deduction of liquidated damages and require these disputes to be referred to arbitration.’? The Respondent Employer made no response or acknowledgement of this notice.
(c) On 7 May (received on 8), the Claimant applied to RICS President for an appointment and you were subsequently appointed.
The Respondent’s submission is that the date for commencement of proceedings as defined in s.14(4) of the 1996 Act is the date when one party serves notice in writing requiring him to appoint an arbitrator or to agree to the appointment of an arbitrator, and the Claimant had never made such a request. Alternatively, if s.14(5) applies, then the relevant date would be when he gave notice to RICS, 7 May, outside the 28 day period of limitation.
The Claimant (who has now obtained advice) submits that clause 41.1 states that one of the parties requiring a dispute or difference to be referred ‘shall give written notice to the other to such effect, and such dispute or difference shall be referred to the arbitration and final decision of a person to be agreed between the parties’. This clause, on its true construction, means that the notice only has to require the dispute to be referred, the requirement to agree an arbitrator is implied by clause 41.1 and the notice of 20 April was therefore adequate and effective, within time.
What do you do?