046-NLR-NLR-V-16-FERNANDO-v.-MIGEL-APPU.pdf
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Present: Lasoelles C.J..
FERNANDO v. MIGEL APPU.
438—C. B. Negombo, 19,371.
Arbitration—Legal misconduct—Receiving fee from one party beforemaking the award.
The receipt of a fee from one of the parties to a suit by anarbitrator before he made his award was held to amount to legalmisconduct.
Lascellks C.J.—Any act amounts to a legal misconduct if itwould give rise to a reasonable probability that the arbitrator
would be subjected to any improper influenceAfter making
his award the arbitrator is entitled to retain the award until he hasreceived his fee either from one party or the other. But that is awholly different matter from taking a fee from one of the partiesbefore he has actually made his award. The receipt of a fee atthat stage is an act which is calculated to Undermine the confidenceof the opposing party in the impartiality of the arbitrator.
'J'HE facts appear from the judgment.
Bawa, K.G., Acting S.'-G., for the defendant, appellant:—Thearbitrator in this case received tie fee from the plaintiff before hemade his award. The receiving of the fee under the circumstances,amounts to legal misconduct. Echersley v. The Mersey Dochs.1The arbitrator might have taken the fee after making the award;he might' have retained the award till his fee was paid. Bussell onArbitration, 297-298.
A. St. V. Jayewardene, for the plaintiff, respondent.—It is notalleged that the arbitrator was biased by reason of his having takenthe fee from one party before the making of the award. On theother hand, it was the appellant's proctor who advised the arbitratorto get his fee from the respondent in the first instance. Arbitratorsusually receive their fees before making their awards.
January 21, 1913. Lasoelles C.J.—
This is an application to set aside an award on the ground ofmisconduct on the part of the arbitrator. The alleged misconductconsists in the fact that the arbitrator, before ne made his award,accepted his fee, which amounted to Rs. 21, from the plaintiff.There is, it is fair to notice, no imputation of dishonesty against thearbitrator, nor is it alleged or proved that he waB in fact influencedin his award by the fee which he had received from one of the parties.
* (1892) 2 Q. B. 687.
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im.
JjABOEUMB
O.J.
Fernanda v,
Migel Appu
But in order to constitute legal misconduct, it is not necessary thatthere should be proof of any dishonesty or partiality on the part ofthe arbitrator. Any act amounts to a legal misconduct if it wouldgive rise to a reasonable probability that the arbitrator wouldbe subjected to any improper influence. Now the rights of anarbitrator as regards the payment of his fee are well settled. Aftermaking his award he is entitled to retain the award until he hasreceived his fee either from one party or the other. But that is awholly different matter from taking a fee from one of the partiesbefore he has actually made his award. The receipt of a fee at thatstage is, in my opinion, an act which is calculated to underminethe confidence of the opposing party in the impartiality of thearbitrator. There is one portion of the evidence of the arbitrator to. which I ought to refer. The arbitrator in his evidence stated thatthe defendant’s proctor had advised him to take his fee first fromthe plaintiff, and had stated that the defendant would not beresponsible for his fee. If the meaning of that evidence is, as Ifirst thought, that the. defendant’s proctor had suggested that thearbitrator should take his fee from the plaintiff before he made hisaward, I should certainly have held that it did not lie in the mouthof the defendant to object to the award on the ground that the.arbitrator had adopted a course which their own proctor hadsuggested. But Mr. Bawa has pointed out that it is possible thatthe meaning of the advice given by the defendant’s proctor wasthat, after the award had been made, that is, at the proper timewhen the fee ought to be paid, the arbitrator should take his fee fromthe plaintiff. This,- of course, would be a perfectly unobjection-able proceeding, and it is, perhaps, the course which the defendant’sproctor advised. I think it would be setting a very dangerousprecedent if it were held that an arbitrator, before the completionof his award, was entitled to receive payment of his fee from eitherof the. parties to the arbitration. The receipt of the fee at thisstage of the arbitration, in my opinion, amounts to legal misconduct,and the appeal must be allowed and the award set aside. Theappellant is entitled to the costs of the appeal and to the costs .ofthe application in the Court below.
Set aside.