Judgment Summary
One of the essential requirements of an arbitration award is the signature, on the award, of the arbitrators who have issued the award. From a legal point of view, a signature is the only evidence of the existence of such award. The meaning of an arbitration award in this context covers both the reasoning and decision of such award. Therefore, the arbitrators should sign both the reasoning and decision of the award, failing which such award shall be invalid.
However, an exception to the above rules is when the reasoning of the award, or parts thereof, are continued on the page where the decision and the signatures of the arbitrators appear. In such an event, the signature shall be deemed to cover the grounds of the award. On the other hand, if the grounds of the award appear on pages separate from the page on which the decision appears, all pages of the award, including the last page where the decision appears, should be signed by all arbitrators who issued the award. Failing this, such award shall be invalid.
The facts
Party A filed a suit before the Dubai Court of First Instance seeking a judgment to confirm an arbitration award which ordered Party B to pay Party A the amount of AED 400,000, together with interest at the rate of 9% from the due date of 20th July 2003, until full payment. Party B was also ordered to pay Party A's arbitration fees.
Party A pleaded that it had filed a commercial case in which it sought a judgment against Party B (a joint venture) in relation to a subcontract for the supply and installation of 24 lifts in Juma Al Majid Residential Complex in Al Nahda, Sharjah.
Upon completion of the works by the Party A, Party B refused to pay it the final payment (the amount withheld against maintenance works) in the amount of AED 400,000 without any a legal justification. Party B pleaded that Party A's suit was inadmissible on the ground that the parties had agreed to solve disputes through arbitration. Party A accordingly amended its case and requested the Court to appoint an arbitrator to conclude the dispute between the parties.
The sole arbitrator's award required Party B, jointly and severally, to pay the amount of AED 400,000 together with simple interest at the rate of 9% per annum from the due date until full payment to Party A (plus arbitration fees). Further, the defendants were required to jointly and severally pay AED 14,000 as arbitration fees.
Accordingly, Party A filed a case with the Dubai Courts seeking to enforce the award. Party B filed an interlocutory application requesting the Court to invalidate the award. The Court supported Party A's case.
Party B appealed to the Court of Appeal, which accepted the appeal and ruled to invalidate the arbitration award.
Accordingly, Party A appealed to the Court of Cassation. The Court of Cassation ruled in favour of Party A, drawing support from Article 212 of the Civil Procedures Law. According to this article, one of the essential requirements of an arbitration award is the signature of the arbitrator who has issued the award.
Upon examination of the arbitrator's award it was established that the last page contained part of the grounds followed by the decision of the award, and was signed by the arbitrator. As such, the signature by the arbitrator was held to cover both the grounds and decision of the award; hence it complied with Article 212. The Court of Appeal was held to have erred in its application of the law, and its findings were revoked.
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