Few Highlights of the Arbitration Act

a). The Arbitration Clause: The Arbitration and Conciliation Act (ACA) mandates that all arbitration agreements must be in writing and signed by the parties, in exchange of letters or point of claim or defence. In Nigeria, arbitration clauses are irrevocable except by the leave of court or mutual agreement of parties. Even where parties had no prior agreement, with a submission agreement, parties may still submit to arbitration.

b). The Subject-matter: The ACA does not stipulate any particular subject matter that may not be referred to arbitration. The question of whether or not a dispute is arbitral even has therefore been left at the discretion of the courts. In the case of Arab Republic V Ogunwale (2002) 9 NWLR (Pt 771) 127, the Court of Appeal held that the test for determining whether a dispute is arbitrage or not is that the dispute or difference must necessarily arise from the clause contained in the agreement. However not all disputes are necessarily arbitrable.

c). The binding nature: The ACA provides that every arbitration award in Nigeria shall be binding on the parties.

d). Number of Arbitrators: In Nigeria, the number of arbitrators is either one or three. The parties to an arbitration agreement may determine their preferred numbers of arbitrators to be appointed under the agreement, but where there is no such agreement, the number of the arbitrator shall be deemed to be three.

e). Challenge of an arbitrator: Parties may determine the procedure to be followed in challenging an arbitrator. Where no such procedure is determined a party who intends to challenge an arbitrator shall, within fifteen days of becoming aware of the constitution of the arbitral tribunal or becoming aware of any of the grounds, send to the arbitral tribunal a written statement of the reasons for the challenge.

f). Preservative Orders: The provisions of ACA gives the members of a tribunal with the requisite powers to grant preservative orders during an arbitration. These orders however does not include granting injunctions etc. The Act  provides that in such circumstances, the Tribunal can remit that portion of the reference to a proper court to grant such injunctive relief.

g). The language of the arbitral proceedings:  In Nigeria, the parties may, by agreement determine the language(s) to be used in the arbitral proceedings. But where they do not do so, the arbitral tribunal shall determine the language to be used bearing in mind the relevant circumstances of the case.

h). Legal Representation: In Nigeria, the parties to an arbitral proceeding may appear for themselves or be represented or assisted by a legal practitioner of their choice.

I). The Award: In Nigeria, an award may be interim, interlocutory or final. An award made in Nigeria must adhere to the following:

It must be in writing;

It must be signed by all the arbitrators ( if they are more than one);

The place where the award was made must be stated on the award.

j). Enforcement of the Award: In Nigeria, an arbitral award shall irrespective of the country in which it was made, be recognized as binding on the parties. This is made possible by the Foreign Judgements (Reciprocal Enforcements) Acts, Cap 152, Laws of the Federation of Nigeria 2004, which makes foreign arbitral awards register able in Nigerian Courts, if at the date of register action it could be enforced by execution in Nigeria.

Section 2 of the Act provides that a clause agreeing to refer disputes to arbitration is irrevocable unless the parties so agree or by leave of court. The court will therefore be obliged at the application of one of the parties to stay any proceedings before it in order to refer the dispute to arbitration.

Click here to download the Arbitration Act.

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