Minermet v. Luckyfield Shipping
In this case, the court confirmed that, where a party has agreed that, failing the nomination of his arbitrator within 14 days’ of the appointment of the other side’s arbitrator, that arbitrator shall act as sole arbitrator in the reference, he is bound by that term, even where there had been discussions between the parties’ legal representatives during the 14 day period. The appointing party had no duty to give the other party a second chance.
DMC Category Rating: Confirmed
This case note is based on an Article in the May 2004 Edition of the ‘Bulletin’, published by the Marine and Insurance teams at the international firm of lawyers, DLA. DLA is an International Contributor to this website.
On 3 July 2003, solicitors acting for Luckyfield wrote to Minermet's solicitors putting forward a claim of just under US$70,000 demurrage due under the charter. The letter nominated Mr Oakley as Luckyfield's arbitrator and referred to clause 19 and the 14-day time limit. There then followed correspondence in which Minermet put forward a counterclaim and disputed the calculation of laytime.
On 28 July 2003, Luckyfield's solicitors notified Mr Oakley and told Minermet's solicitors that, since Minermet had not appointed their arbitrator within the 14 days, Mr Oakley would be acting as sole arbitrator. Minermet immediately responded, purporting to nominate their own arbitrator.
Mr Oakley ruled that he had been properly appointed, but Minermet challenged that ruling on the grounds there had been a serious irregularity in the proceedings, namely a failure to comply with the general duty of fairness in Section 33 of the Arbitration Act. It also clamed Mr Oakley had not had substantive jurisdiction to make his ruling.
Section 79 of the Arbitration Act gives the court power to extend any time limit if satisfied that a substantial injustice would otherwise be done. But there was no evidence of any such substantial injustice. The application was dismissed.
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