Twinomujuni v Trust Hands of Hope Limited (Miscellaneous Application 97 of 2024) [2025] UGCommC 38 (27 March 2025)

Full Case Text

#### THE REPUBLIC OF UGANDA

### IN THE HIGH COURT OF UGANDA AT KAMPALA (COMMERCIAL DIVISION)

## **MISCELLANEOUS APPLICATION NO. 0097 OF 2024** ARISING FROM 005-KTA-2022-ADR ARISING FROM CIVIL SUIT NO. 0485 OF 2020

### TWINOMUJUNI KENNETH :::::::::::::::::::::::::::::::::::: **VERSUS**

TRUST HANDS OF HOPE LTD ::::::::::::: **EXAMPLE 21: 11: 11: 11: 11: 11: 11: 11: 11: 11:**

#### (Before: Hon. Justice Patricia Mutesi)

#### **RULING**

#### **Background**

The Applicant brought this application by notice of motion under Section 34(2) of the Arbitration and Conciliation Act, Section 33 of the Judicature Act, Section 98 of the Civil Procedure Act and Order 46 Rules 1 and 2, Order 51 Rule 6 and Order 52 of the Civil Procedure Rules seeking orders that:

- 1. The award in Arbitration 005-KTA-2022-ADR be unconditionally set aside and the matter be referred back to an independent arbitrator. - 2. The ruling arising from the award in Arbitration 005-KTA-2022-ADR be set aside and the matter be referred back to an independent arbitrator. - 3. The execution proceedings arising from the award and the ruling arising from the award in Arbitration 005-KTA-2022-ADR be stayed until further orders of this Court. - 4. Costs of this application be provided for.

Briefly, the grounds of this application are that:

- 1. On 26th September 2018, the Respondent advanced a friendly loan of UGX 30,000,0000 to the Applicant which was secured by a mortgage over the Applicant's matrimonial property comprised in Busiro Block 277 Plot 466 situate at Kigoma. - 2. On 29th May 2019, the Respondent gave another loan to the Applicant of UGX 20,000,000 which was secured by the Applicant's matrimonial land

comprised in Busiro Block 277 Plot 465 at Kigoma. The loan was to finance the Applicant's wife's business and it was to be repaid concurrently with the earlier loan.

- 3. As the Applicant was servicing the two loans, he secured a contract with Kinyara Sugar Works for transportation of sugar cane which required a truck that he did not have. He approached the Respondent with the contract and requested it to compound his two earlier loans and combine them with the truck loan into one lump sum loan. - 4. On 18th June 2019, the Applicant executed a friendly loan agreement of UGX 274,000,000 with the Respondent for the purchase of Motor Vehicle Truck No. UBF 110K. - 5. The Applicant made a part payment of UGX 17,867,700 towards the loan, but, before he could fully repay the loan, the Respondent recalled and forcefully repossessed the truck that the Applicant was using to service the loan. - 6. The Respondent sold the truck without a valuation report from a licensed valuer. The report relied on by the Respondent during the trial was not conclusive but an internal opinion for estimation purposes. - 7. The Applicant thereafter instituted Civil Suit No. 0485 of 2020 against the Respondent for breach of contract but the matter was sent to arbitration under Arbitration 005-KTA-2022-ADR. - 8. The arbitral award was delivered against the Applicant and the same was tainted with partiality and bias. In that award, the arbitrator relied only on the Respondent's evidence and disregarded the Applicant's evidence. - 9. The arbitrator did not consider the fact that the truck was sold without the Applicant's consent and participation, along with the Respondent's action of offsetting unknown amounts of money from the sum it got from the sale yet these actions were contested by the Applicant. - 10. The Applicant filed this application for orders that the arbitral award be set aside, that the matter be sent back to an independent arbitrator and that all execution proceedings be stayed until further orders of this Court. - 11. The Applicant's counsel later received a letter in which the Respondent's counsel was moving the arbitrator to amend the arbitral award. - 12. The Applicant's counsel subsequently responded opposing that letter on grounds that the procedure adopted by counsel for the Respondent to

move the arbitrator was wrong and that the Respondent's intention was to mislead the arbitrator into changing the award.

- 13. Despite the Applicant's lawyers' protest against the process of correction, the arbitrator proceeded and purportedly reviewed the award and a new ruling was served on the Applicant's counsel on 7th May 2024. - 14. Both the award and the ruling arising from the award in Arbitration 005-KTA-2022-ADR were issued through evident partiality by the arbitrator as he deliberately/negligently did not consider the Applicant's evidence. - 15. It is in the interest of justice that this application be allowed.

The application is supported by the affidavit of the Applicant. He told the Court that on 26th September 2018, the Respondent gave him a friendly loan of UGX 30,000,000 secured by his matrimonial property comprised in Busiro Block 277 Plot 466 at Kigoma. On 29th May 2019, the Respondent gave him another loan of UGX 20,000,000 secured further by his matrimonial property comprised in Busiro Block 277 Plot 465 at Kigoma to finance his wife's business. As he was still servicing the 2 loans, he secured a contract for transportation of sugar cane for Kinyara Sugar Works which required a truck that he did not have at the time. He, again, approached the Respondent and requested it to consolidate his 2 earlier loans with a truck loan into one lumpsum loan. His request was accepted by the Respondent who tasked him to look for a suitable truck of his interest. He later managed to get a desirable truck from Tata (U) Ltd. The latter gave him a price quotation of USD 51,500 that he forwarded to the Respondent.

He said that, after sometime, the Respondent agreed to purchase for him the truck and allowed his request to consolidate his loans into one loan amounting to UGX 274,000,000 inclusive of the Truck loan on condition that the truck was to be registered in its name. He received the truck from the Respondent on 26th June 2019 after it had earlier been registered in the Respondent's name under Reg. No. UBF 110K with comprehensive insurance. He similarly dispatched it to Kinyara Sugar Factory on 27th June 2019 to transport sugar cane.

The Applicant told the Court that, having received the truck, he made payments of UGX 17,867,700 in loan installments. However, on 23rd October 2019 (after only 3 months), the Respondent recalled and repossessed the truck without any warning or opportunity to explain the delay for the loan payments. He strongly

protested the sale of the truck but his notice to halt the sale of the Truck was ignored by the Respondent. The truck was illegally sold without his knowledge and consent and at very low price. After the sale, the Respondent purportedly offset unknown sums of money from the total consolidated loan without his knowledge, consent and involvement. He averred that his obligations stopped immediately after the truck was recalled.

The Applicant told Court that he instituted Civil Suit No. 0485 of 2020 against the Respondent for breach of contract but that the matter was sent to arbitration under 005-KTA-2022-ADR. The arbitral award was delivered on 21st December 2023 and the total lump sum loan claimed by the Respondent was reduced by the arbitrator (from UGX 439,920,000 to UGX 74,200,000) but the arbitrator ignored the fact that the Respondent intentionally frustrated and prevented him from fulfilling his loan obligations when it recalled the truck well knowing that it was supposed to generate the income for loan repayment. He immediately instructed his lawyers to file an application challenging the said arbitral award on grounds of partiality and bias hence this application.

Finally, the Applicant stated that his lawyers were later served with a letter of correction of arithmetic errors in the arbitral award dated 8th January 2024 in which the Respondent moved the arbitrator to amend the award. Despite his lawyers' protests, the arbitrator reviewed the figures in the award and a new ruling was served on the Applicant's counsel on 7th May 2024. The process of the arbitrator revising the award without the Applicant's input and without any response to his lawyer's protest on the same in itself exhibits partiality and bias of the arbitrator. The perusal of the award and the Ruling arising from the award in arbitration shows that the arbitrator deliberately/negligently did not consider the Applicant's evidence on key points. The Respondent is now threatening to execute the award and the ruling arising therefrom by selling his matrimonial property. He stands to suffer substantial and irreparable loss if this application is not granted.

The Respondent opposed the application through an affidavit in reply sworn by Ms. Ameria Momo Masiko, its Chief Executive Officer. She told the Court that this application is brought in bad faith and that it is a disguised appeal intended to delay the enforcement of the arbitral award. She admitted that the Applicant secured the 2 loans in 2018 and 2019 from the Respondent as he has stated but

that the 2 loans were independent of each other and that they were to be repaid separately. She clarified that the Applicant had borrowed 4 other loans between 2016 and 2018 which were also secured using the same matrimonial property as the 2 loans in issue in this case and that he had defaulted on the last of those 4 loans.

She admitted that the Applicant approached the Respondent with a contract from Kinyara Sugar Works and applied for a loan to buy a truck that would work that contract. He also requested the Respondent to consolidate his earlier loans with the truck loan. The Respondent then agreed to purchase the truck for the Applicant and indeed the Respondent advanced to the Applicant a loan of UGX 274,000,000 for that purpose. The said amount only included the loan arrears on the loan of UGX 30,000,000 extended on 26th September 2018 and not those on the 2nd loan of UGX 20,000,000. By 18th September 2019, the Applicant had only remitted UGX 11,000,000 to the Claimant despite several demands. This forced the Respondent to recall the truck.

She said that the Applicant then asked for more time to pay up the loan arrears. This was allowed and the Respondent parked the truck for about 12 months at the Applicant's request. Before selling the truck, the Respondent shared a copy of the valuation report with the Applicant who never contested it. Although the truck was worth UGX 200,000,000 at purchase, the total loan disbursed to the Applicant was a total of UGX 274,000,000. When the truck was sold at UGX 160,000,000, the Applicant remained indebted to the Respondent.

She told the Court that the Respondent was not served with the Applicant's lawyer's protest against the variation of the arbitral award. The arbitrator served the Applicant's former lawyers (his known lawyers at the time) with a hearing notice for a meeting between the arbitrator, counsel and the parties regarding the Respondent's request for correction of the errors in the arbitral award. However, the said lawyers did not appear the meeting. The Applicant never served the Respondent with a notice of change of advocates. The Respondent only got to know about the Applicant's current lawyers through this application.

Finally, she stated that the Respondent further served the Applicant with the said hearing notice at his home and through his Whatsapp number but that the Applicant did not appear when the matter was called before the arbitrator for consideration of the Respondent's request to correct the award. In any case, the

Applicant participated in choosing the arbitrator and agreed to his appointment before participating in the arbitration. He cannot turn around after the matter is concluded to say that the arbitrator was partial after the ruling was delivered against him. Since the arbitral award has not yet been registered in this Court for execution purposes, there is no present threat of execution to warrant stay of execution orders.

The Applicant swore and filed an affidavit in rejoinder responding to the affidavit in reply. He told the Court that the Respondent's application for correction of arithmetical errors was brought out of time and that it should be discarded and struck off the record. He maintained that this application is brought in good faith and has strong grounds to set aside the arbitral award. The parties were directed to jointly clear the arbitrator's fees with each party making a payment of UGX 3,600,000 which, owing to the fact that he did not have money at the time, he was unable to pay and the Respondent instead opted to harass him through phone calls and accusations that he was delaying "her judgment", along with threats of paying the arbitrator the total sum to get "her judgment".

The Applicant revealed that, indeed, before he could pay his part of those fees, the arbitrator delivered the award under unclear and suspicious circumstances. The Respondent's knowledge that the judgment was in her favour even before it was delivered by the arbitrator is proof that the arbitrator was not impartial. The arbitrator's partiality is so glaring that it suffices as a ground to set aside both the arbitral award and the Ruling arising from the award in arbitration. He averred that he was not given proper notice of the arbitral proceedings for the correction of errors in the award.

#### **Issues arising**

- 1. Whether the Respondent's request for correction of the arbitral award was filed within the prescribed time. - 2. Whether the Respondent's request for correction of the arbitral award was handled by the arbitrator within the prescribed time. - 3. Whether the Applicant was given proper notice of all the proceedings in Arbitration 005-KTA-2022-ADR. - 4. Whether there was evident partiality in the arbitrator. - 5. What reliefs are available to the parties.

## **Representation and hearing**

At the hearing, the Applicant was represented by Mr. Samuel Eyotre of M/s Eyotre & Co. Advocates while the Respondent was represented by Mr. Innocent Ngobi Mbiko M/s Ngobi Ndiko Advocates. I have carefully considered the submissions of counsel, the laws and authorities they cited and all the other materials on the record while deciding this application.

#### **Determination of the issues**

Issue 1: Whether the Respondent's request for correction of the arbitral award was filed within the prescribed time.

In his affidavit in rejoinder, the Applicant belatedly asserted that the application for correction of arithmetic errors in the award was filed out of time. Although this left the Respondent with no opportunity to address that claim through its affidavit in reply, I have found that the Respondent adequately responded to the claim in its submissions.

Section 33(1)(a) of the Arbitration and Conciliation Act (the "ACA") provides that, within 14 days after the receipt of the arbitral award, unless a different period of time has been agreed upon by the parties, a party may request the arbitral tribunal to correct in the arbitral award any computational errors, clerical or typographical errors or any other errors of a similar nature.

In the instant case, the Applicant admits in para. 20 of his amended affidavit in support that the Respondent's request for correction of arithmetic errors in the award is dated 8th January 2024. I have also examined the said request. It shows that it was filed with the arbitrator on 9th January 2024, as the Respondent has admitted in its submissions. Therefore, the request was made 19 days after the date of delivery of the award on 21st December 2023. This was clearly outside the prescribed time.

# Issue 2: Whether the Respondent's request for correction of the arbitral award was handled by the arbitrator within the prescribed time.

Section 33(2) of the ACA provides that, if the arbitral tribunal considers the request made under subsection (1) to be justified, it shall make the correction or give the interpretation within 14 days after receipt of the request, and the interpretation shall form part of the arbitral award. According to Section 33(6) of the ACA, the arbitral tribunal may extend, if necessary, the period of time within which it shall make a correction, give an interpretation or make an additional arbitral award under subsection (2) or (5) except that the extension cannot exceed 14 days.

I have examined the ruling of the arbitrator arising from the impugned request for correction of the award. It is dated 3rd April 2024. This was 91 days after the request was filed with the arbitrator, which is contrary to Section 33(2) of the ACA. The arbitrator did not acknowledge this defect expressly in the ruling and the record does not show that he formally extended the period allowed for handling the request. In any case, even if he had formally extended the time allowed for handling the request, he could only have extended it for a further 14 days only which implies that the latest he would have made a decision on the request was 28 days after the same was made to him.

For these reasons, I find that the Respondent's application for correction of the arbitral award was not handled by the arbitrator within the prescribed time.

# Issue 3: Whether the Applicant was given proper notice of all the proceedings in Arbitration 005-KTA-2022-ADR.

Section 34(2)(iii) of the Arbitration and Conciliation Act provides that an arbitral award may be set aside by the court if the party making the application for that relief furnishes proof to the court that he or she was not given proper notice of the appointment of an arbitrator or of the arbitral proceedings or was unable to present his or her case.

The Applicant does not contest that he was properly served with all necessary notices for appointment of the arbitrator and for proceedings in the arbitration before the award was delivered on 21st December 2023. His only issue with the service arises from the subsequent proceedings through which the Respondent secured adjustments in the award by the correction of arithmetic errors.

The facts leading up to those subsequent proceedings are that, in January 2024, the Respondent wrote a letter to the arbitrator, copied to the Applicant, citing arithmetic errors in the award and pointing out that the version of the award that had been delivered via email was unsigned. The Applicant admits that that letter was served on his lawyers at the time, M/S KRK Advocates, who wrote to the arbitrator protesting the then proposed adjustments. The arbitrator elected to fix the matter for hearing so that both parties are heard before he makes his decision on the request. On 14th March 2024, the matter was fixed for 20th March 2024. The hearing notice was served on the Applicant's lawyers at the time, M/S KRK Advocates, on 15th March 2024. Although the said lawyers acknowledged the service, they noted on the received copy that they no longer had instructions to represent the Applicant in the matter and that the hearing notice had to be served on the Applicant personally.

According to the affidavit of service of said hearing notice sworn by Mr. Buyinza George, he had also gone to the Respondent's home to serve the hearing notice and, although he was not allowed access into the home, he slipped a copy of the notice through the gate. He also stated that he sent a photo of the hearing notice to the Respondent phone number via WhatsApp. However, the Respondent did not acknowledge receipt of the hearing notice in any of those 2 instances.

The hearing proceeded in the Applicant's absence on the date fixed. On 3rd April 2024, the arbitrator delivered his ruling on the matter. He found that there had been an error in the tabulation of interest due to the Respondent in the initial award and, accordingly, adjusted the award.

In Geoffrey Gatete & Anor v William Kyobe, SCCA No. 7 of 2005, the Supreme Court explained that the desired and intended result of service is to make the party served aware of the matter to which the service relates so that he has the opportunity to take the necessary actions to protect his or her interests. Service which achieves that desired and intended result is deemed effective service and it is best achieved when the intended recipient is served personally. However, where that is not possible, the law also allows the other forms of service in which the said desired and intended result could still, typically, but may not always, be achieved. These are referred to as good service.

Courts have recognised that there is now the growing trend in which electronic service of documents is being continuously embraced. Nonetheless, the true position of the law is that in all instances where parties to a dispute resort to electronic service of documents, the primary test for allowing such service is whether or not the same was effective. Accordingly, a court will willingly accept electronic service of process as long as there is proof that the person on whom the process was served became aware of that process and the matter to which it relates, as a result of the service. See the decision in Easy Coach Ltd v International Holdings Uganda Ltd, HCMA No. 2430 of 2023.

Without any message from the Applicant acknowledging receipt of the hearing notice on WhatsApp, it appears to me that the service of that notice on him via WhatsApp was not effective.

Although the Applicant's former lawyers acknowledged receipt of the hearing notice, they immediately clarified that they no longer had instructions from the Applicant to represent him in the matter. I also doubt that slipping a copy of the hearing notice through the gate of the Applicant's home amounts to effective service of the hearing notice on him. While the Arbitration and Conciliation Act and the Arbitration Rules do not have expansive provision for the permissible forms of good service of notices in arbitral proceedings, the Civil Procedure Rules under Order 5 Rule 13 anticipate that, where process is taken to a party's home, it has to be actually served on an adult person who resides with that party. In this sense, service is to be actually made on a person and not a place. Thus, it also appears to me that these two attempts at service of the notice do not constitute effective service of the notice on the Applicant.

Section 24(5) of the ACA provides that the parties in an arbitration shall be given sufficient advance notice of any hearing and of any meeting of the arbitral tribunal. It is my considered finding that the Applicant was not given sufficient advance notice of the hearing that was conducted by the arbitrator on the Respondent's request for correction of the award.

## Issue 4: Whether there was evident partiality in the arbitrator.

Section 34(2)(iii) of the Arbitration and Conciliation Act provides that an arbitral award may be set aside by the court if the party making the application for that relief furnishes proof that the arbitral award was procured by corruption, fraud or undue means or that there was evident partiality or corruption in one or more of the arbitrators. The Applicant avers in this application that the arbitrator was not impartial in his handling of the arbitration.

In Roko Construction Ltd v Kobusingye Janet, HCMC No. 0022 of 2021, which was relied on by counsel for both parties, it was held that:

"Any tribunal permitted by law to adjudicate disputes and controversies not only must be unbiased but also must avoid even the appearance of bias. One of the most crucial aspects of the arbitrator's role is neutrality. Independence and impartiality constitute a core of arbitrator integrity.

Impartiality requires that the arbitrator should not sit in a proceeding in which he or she is interested, or is perceived to be interested financially, personally or otherwise. Partiality encompasses both an arbitrator's explicit bias toward one party and an arbitrator's inferred bias when he or she fails to disclose relevant information to the parties."

In arbitration, the autonomy of the parties is accorded paramount importance. For that reason, any court adjudicating upon the validity of an arbitral award is not to function as an appellate court, but merely has to decide upon the legality of the award. When a court reviews an arbitration award, it should not concern itself with the merits of the determination. If the arbitrator has acted within his or her jurisdiction, his legal and factual findings are final, even though the court might have decided the merits of the dispute differently. Save for some specified circumstances, the parties take their arbitrator for better or worse, both as to decision of fact and decision of law. (See Roko Construction Ltd v Kobusingye Janet, (supra).

From the onset, it seems to me that the Applicant has presented this application in the hope that the Court will reconsider some or most of the merits of his case which were already decided by the arbitrator. He dedicated substantial portions of the notice of motion and supporting affidavits to recounting the genesis of the dispute and the perceived genuineness of his case. While this is noted, this Court is not empowered to revisit those merits, however genuine they may be. Those merits of the case were already conclusively decided by the arbitrator and this Court cannot sit in appeal over them, except as anticipated by Section 38 of the Arbitration and Conciliation Act.

The mere fact that the arbitrator decided the case against the Applicant does not imply that he acted with evident partiality. Evident partiality must be direct, definite and capable of demonstration. Such partiality should not be remote, uncertain or simply speculative. There must be an actual, discernible inclination

to favour one party or a predisposition to a particular point of view which might affect the result of the arbitration. (See Roko Construction Ltd v Kobusingye Janet, (supra). As such, merely losing the case in arbitration is not, in and of itself, a symbol of evident partiality.

For the Court to make a finding that there was evident partiality in an arbitrator, there must be evidence of a discernible inclination by that arbitrator to favour one party over the other or of a reasonable impression of such an inclination. The true test to be applied is whether the circumstances could properly cause a reasonably well-informed person to have a reasonable apprehension of a biased appraisal/judgment by the arbitrator, however unconscious or unintentional it might be. (See Cairo Bank (U) Ltd v Cads Ventures Ltd, HCMC No. 0048 of 2023.)

Having analysed the application in its entirety, my impression of the Applicant's allegation that the arbitrator was biased is that it is insincere. The Applicant seems to be merely sour-graping after he lost the case in arbitration. As counsel for the Respondent pointed out, para. 18 of the Applicant's affidavit in support shows that the Applicant started seeing the arbitrator's "bias" only after he received and read the award. As I noted earlier, the Applicant agreed to the appointment of the arbitrator and does not seem to have had any issue with his conduct of the arbitral proceedings. This historical flow of the events leading up to this application betrays the Applicant's claim that the arbitrator was biased as being an afterthought by the Applicant, made in an attempt to evade the

In his affidavit in support, the Applicant alleged that the arbitrator did not look at all his evidence. Having read the arbitral award, I find that this is not true. The award shows that all the evidence presented by the parties at the trial was considered. In fact, again, as counsel for the Respondent rightly submitted, a number of the Respondent's claims were actually disallowed by the arbitrator, in the Applicant's favour after considering all the evidence adduced.

Furthermore, the Applicant took issue with the Respondent's payment of the arbitrator's fees. The Applicant believes that the arbitrator demonstrated bias when he allowed the Respondent to pay the entire sum of fees agreed yet the parties had agreed that each of them pays half of that sum. This argument has no merit. First, it betrays the fact that the Applicant refused/failed to pay his

portion of the arbitrator's fees within time yet he had agreed to do so earlier, so he does not have clean hands in this matter.

Second, while I note that Section 31(9)(b) of the ACA provides that each party to the arbitration is ordinarily responsible for payment of an equal share of the fees and expenses of the arbitral tribunal, I do not find anything sinister or suspicious about an arbitrator allowing one party to pay his or her entire sum of fees agreed upon by the parties if the other party refuses or fails to pay his or her portion. If this is not the case, a party can frustrate the arbitration by merely refusing to pay the arbitrator's fees, thereby putting the arbitral proceedings and award in limbo

This same legal issue was considered by this Court in Pan Afric Impex (U) Ltd v Roko Construction Ltd, HCMA No. 487 of 2010. In dealing with it, the Court cited with approval, Russel on Arbitration (22nd Edition) by David St., John Sutton and Judith Gill, in which the learned authors, at page 126 para. 4-101, opined that:

"The traditional method by which arbitral tribunals have secured payment has been to withhold the award from the party or parties seeking to take it up until any outstanding fees have been paid, effectively to exercise a lien over the award. This is now sanctioned by statute in a provision that the parties cannot exclude. When the award is ready for delivery, the tribunal notifies the parties that it is available on payment of the fees. It does not concern the tribunal which party pays the fees. Where the party who takes up the award is not under its terms liable to pay the fees, he may recover from his opponent all the costs the award imposes including the arbitrator's fees. If neither party takes up the award, the tribunal may have no sanction but to forego its fees or sue for them." Emphasis mine.

I also cite the above text with approval as I find that it is the proper restatement of the law on arbitrators' fees. Accordingly, I do not find any problem with the arbitrator accepting to receive his entire sum of fees from the Respondent upon the Applicant's failure/refusal to pay his portion of those fees as he had agreed.

I do not accept the Applicant's claim that the Respondent used to harass him with calls over delaying "her judgment". Since these claims are uncorroborated by any independent evidence, the Court is unable to confirm their genuineness. In any case, even if such corroborative evidence had been adduced, that phrase

alone would still not prove evident partiality in the arbitrator to a reasonably well-informed person in the case as it could simply have been the Respondent's subjective statement of the perceived strength of its case in arbitration. Moreover, logically speaking, the mere fact that the Respondent went through an entire process of making a request for correction of the award makes it more probable than not that it was not in cohorts with the arbitrator before the award was delivered. If the Respondent had been in cohorts with the arbitrator and if the arbitrator had been partial in his award, the award would not have had the errors it had at the time when it was delivered and the arbitrator would not have disallowed significant parts of the Respondent's claim as he did.

In the premises, I find that there was no evident partiality in the arbitrator.

## Issue 5: What reliefs are available to the parties.

From all the above findings, it is clear to me that Arbitration 005-KTA-2022-ADR was well handled and managed until the day of delivery of the award. The award was delivered unsigned and it contained some arithmetic errors. A request for its correction was filed outside the prescribed time. It should have been ignored or disallowed by the arbitrator. Instead, he chose to hear it. Despite the fact that there was no effective service of the hearing notice for those proceedings on the Applicant, the arbitrator proceeded to hear the matter in the absence of the Applicant and, or, his lawyers. He eventually delivered a ruling on the request 91 days after the same was filed which was also outside the prescribed time.

In the premises, the Court does not see any reason to interrupt the proceedings leading up to the delivery of the award on 21st December 2023. The Court will also not interrupt the award of 21st December 2023. However, it is now obvious that the proceedings on the request for correction of the arbitral award and the ruling therefrom were in contravention of express provisions of the Arbitration and Conciliation Act and they must be set aside.

I have noted that the Respondent is already out of time to file a request with the arbitrator for correction of any errors in the award. Although the Arbitration and Conciliation Act does not expressly permit an arbitrator to extend/enlarge time allowed for taking certain steps in arbitration, Section 19 thereof, in furtherance of party autonomy which forms the bedrock of arbitration, allows parties to decide and customise the rules that govern their arbitration. Thus, if the parties

in this case agreed on the rules that would govern the extension or enlargement of the time allowed for taking certain steps in their arbitration, the Respondent may follow those rules and apply to the arbitrator for leave to file its request for correction of errors in the award outside the prescribed time.

If, however, no such rules were agreed on, Section 19(2) of the Arbitration and Conciliation Act still provides that the arbitral tribunal may, subject to the Act, conduct the arbitration in the manner it considers appropriate. This could afford the Respondent a window through which it can seek the leave of the arbitrator through a formal inter-parties application to file its request for correction of the errors in the award outside the prescribed time.

In the meantime, the Court will register and enforce a duly signed copy of the arbitral award in Arbitration 005-KTA-2022-ADR dated 21st December 2023. If the Respondent's efforts to have that award adjusted eventually succeed, the resultant ruling will also be registered and enforced in a similar manner pursuant to Sections 31, 33, 35 and 36 of the Arbitration and Conciliation Act.

## **Reliefs**

Consequently, this application succeeds in part and I make the following orders:

- The signed copy of the arbitral award in Arbitration 005-KTA-2022-ADR dated 21st December 2023 shall be registered by the Court. - The ruling and proceedings arising from the Respondent's request for ii. correction of errors in the arbitral award in Arbitration 005-KTA-2022-ADR are hereby set aside. - Having succeeded only in part in his claims, the Applicant is awarded iii. one half of the costs of this application.

theadines

**Patricia Mutesi JUDGE** $(27/03/2025)$