018-SLLR-SLLR-2008-V-1-AIRPORT-AND-AVIATION-SERVICES-SRI-LANKA-LTD-.-v.-BUILDMART-LANKA-PVT-L.pdf
202Sri Lanka Law Reports[2008] 1 Sri L.R
AIRPORT AND AVIATION SERVICES (SRI LANKA) LTD.v
BUILDMART LANKA (PVT.) LTD.SUPREME COURT
DR. SHIRANI BANDARANAYAKE, J.
SOMAWANSA, J.
RATNAYAKE, J.
SC 110/2007
SC HC LA 46/2007
HC A.R.B. 998/2006 & 1249/2007
Arbitration Act 11 of 1995 – Section 32 – Application under Section 32 to setaside award – Out of Time? What is the time period? – Computation of the 60 dayperiod? – Is it from the date of award or date of receipt of award?
After several dates of hearing, the Tribunal pronounced its award on 31.5.1986.The appellant was not informed of this, and he was absent on this date. Theappellant had received the award on 14.06.2006 and he filed an application interms of section 32 in the High Court to set aside the award. The respondent hadalso filed an application to enforce the award.
The High Court dismissed the application of the appellant on the basis that it wasnot filed within 60 days from the date of pronouncement of the award.
Held:
Application for the purpose of setting aside an award by the High Courtmust be made within a time period of 60 days and the said period is takeninto account from the receipt of the award by the party making suchapplication to the High Court – and not from the date of the award.
APPEAL from an order of the High Court of Colombo with leave being granted.
Case referred to:
(1) Southern Group Civil Construction Pvt. Ltd. v Ocean Lanka (Pvt.) Ltd. SC69/99 SCM 25.02.2002.
SCAirport and Aviation Services (Sri Lanka) Ltd. v203
Buildmart Lanka (Pvt.) Ltd. (Dr. Shirani Bandaranayake, J.)
Gamini Marapana PC with Navin Marapana for respondent-petitioner-appellant.Nihaf Fernando PC with Rudra Anthony for claimant-respondent-respondent.
July 22, 2008.
DR. SHIRANI BANDARANAYAKE, J.This is an appeal from the judgment of the High Court ofColombo dated 14.11.2007. By that judgment the High Court hadmade order dismissing the respondent-petitioner-appellant'sapplication (hereinafter referred to as the appellant) made in termsof Section 32 of the Arbitration Act, No. 11 of 1995 on the soleground that the application was out of time and allowed theapplication made by the claimant-respondent-respondent(hereinafter referred to as the respondent). The appellant soughtLeave to Appeal from this Court, which was granted to consider thefollowing question.
"Has the learned High Court Judge correctly interpreted the
provisions of Section 32(1) of the Arbitration Act, No. 11 of 1995?"
The facts of this appeal as submitted by the appellant, albeitbrief, are as follows:
The respondent, on or about 04.09.2003 had initiated arbitrationproceedings against the appellant claiming damages, inter alia, forbreach of contract. After several dates of hearing, the Tribunal hadpronounced its Award on 31.05.2006. The appellant was notinformed of this date and the appellant has been absent andunrepresented on that day. On 14.06.2006, appellant had receivedby registered post the said Arbitration Award. The covering lettersent by the Arbitration Centre along with the said Award was dated07.06.2006 and it appeared that the letter was posted on or about07.06.2006.
Thereafter on 02.08.2006 the appellant filed an application inthe High Court in terms of Section 32 of the Arbitration Act, No. 11of 1995 (hereinafter referred to as the Arbitration Act) to set asidethe aforesaid Award (Application No. HC/ARB 998/2006). Therespondent also had made an application (Application No. HC/ARB1249/2007) to execute the said Award in terms of Section 31 of theArbitration Act. The appellant had filed objections to the applicationfiled by the respondent bearing No. HC/ARB 1249/2007 and had
204Sri Lanka Law Reports[2008] 1 Sri L.R
stated inter alia that since the appellant's application bearing No.HC/ARB 998/2006 was pending in Court, not to proceed with theapplication filed by the respondent.
Both applications were however, called in Open Court on24.09.2007 and the learned Judge of the High Court consolidatedboth applications in terms of Section 35 of the Arbitration Act. On14.11.2007, learned Judge of the High Court had made orderdismissing the application filed by the appellant under Section 32 ofthe Arbitration Act on the sole ground that it was out of time andallowed the application filed by the respondent bearing No. HC/ARB1249/2007.
Having stated the facts of this appeal, let me now turn to considerthe question on which Leave to Appeal was granted by this Court.
Section 32 is contained in Part VII of the Arbitration Act, whichdeals with 'applications to Courts relating to Awards'. Section 32 refersto the applications for setting aside arbitral awards and Section 32(1)reads as follows:
"An arbitral award made in an arbitration held in Sri Lanka may be
set aside by the High Court, on application made therefore, within
sixty days of the receipt of the award, (emphasis added)"
It is therefore quite clear that even on a plain reading of the sectionan application for the purpose of setting aside an arbitral award by theHigh Court must be made within a time period of sixty days and thesaid period is taken into account from the receipt of the award by theparty making such application to the High Court. This Court hadreferred to the required time period contained in Section 32(1) of theArbitration Act and had clearly stated that an application to set asidean Arbitral Award has to be made within sixty (60) days of the receiptof the Award in Southern Group Civil Construction (Pvt.) Ltd. vOcean Lanka (Pvt.) Ltd1).
It is common ground that the Award in question was pronouncedon 31.05.2006. It is also not disputed that the appellant, who was therespondent in the arbitral proceedings was neither present norrepresented on that day. The proceedings of 31.05.2006 (X3), whichclearly supports this position, reads thus:
"The respondent is absent and unrepresented.
SCAirport and Aviation Services (Sri Lanka) Ltd. v205
Buildmart Lanka (Pvt.) Ltd. (Dr. Shirani Bandaranayake, J.)
Today a copy of the Award was handed over to Mr. K.L.H. Perera,Managing Director of the Claimant Company by us.
There was no appearance for the respondent Company. TheCentre is directed to send a signed copy of the Award to therespondent by registered post, (emphasis added)"
The Chief Executive Officer of the I CLP Arbitration Centre hadthereafter taken steps to comply with the order made by the panel ofArbitrators on 31.05.2006, and accordingly a letter under registeredpost was sent to the appellant dated 07.06.2006 (x2). The appellanthad taken the position that it had received the said document only on
In support of this contention, the appellant had attacheda photo copy of the envelope in which the said award was forwardedto the appellant under registered post (X1).
Learned Judge of the High Court after considering the facts andcircumstances of the application filed by the appellant (HC/ARB998/2006) had taken the position that the appellant had institutedproceedings, beyond the 60 days stipulated by Section 32 of theArbitration Act. He has clearly stated in his judgment that,
It is common ground that the petitioner instituted proceedings inthe High Court of Colombo on 02.08.2006 (Application No. HC/ARB998/2006). As stated earlier, it is also common ground that theTribunal had pronounced its Award only on 31.05.2006 and the lettersent by the Arbitration Centre along with the said Award was dated
According to the appellant, he had received the saidAward on 14.06.2006. Section 32 of the Arbitration Act clearly states
206Sri Lanka Law Reports[2008] 1 Sri L.R
that the application for setting aside the arbitral award has to be filed'within sixty days of the receipt of the award.' The emphasis, it is to benoted in this clause, is on the ’receipt of the award' and hence, thedate which is important for a matter initiated in terms of Section 32 ofthe Arbitration Act, is not the date that the Award was 'pronounced, butthe date such Award was received by the party, who is relying onSection 32 of the Arbitration Act.
On an examination of the judgment of the High Court it is thusapparent that the High Court had gone on the basis that an applicationin terms of Section 32 should be filed within 60 days from the date ofthe pronouncement of the Award.
In these circumstances, when one considers the aforementionedfacts and circumstances, it is absolutely clear that the appellant'sapplication dated 02.08.2006 in case No. HC/ARB 998/2006 was filedclearly within the time frame stipulated by Section 32 of the ArbitrationAct.
It is therefore evident that learned Judge of the High Court haderred in holding that the appellant's application filed in the High Courtof Colombo, viz., HC/ARB 998/2006 was out of time.
On a consideration of all the material placed before this Court Iaccordingly answer the question on which Leave to Appeal wasgranted in the negative.
Accordingly, for the reasons aforesaid, this appeal is allowed andthe judgment of the learned Judge of the High Court of Colombodated 14.11.2007 is set aside.
This matter is referred back to the High Court of Colombo forinquiry de novo.
I make no order as to costs.
SOMAWANSA, J.-I agree.
RATNAYAKE, J.-I agree.
Appeal allowed.
Matter referred back to the High Court for inquiry de novo.