Lesotho Highlands Development Authority v Impregilo Spa & Ors

Lesotho Highlands Development Authority v Impregilo Spa & Ors

The arbitrators exceeded their powers under section 68(2)(b) of the Arbitration Act 1996 by awarding sums in currencies and at interest rates not provided for in the contract or the law of Lesotho, which governed the contract. Both currency and interest were matters of substantive law under the parties’ agreement and the applicable law, not matters of procedural discretion under English law. The appeal was dismissed.

Parties
Claimant/respondent: Lesotho Highlands Development Authority; Defendants/appellants: Impregilo SPA and Others (Highlands Water Venture)
Jurisdiction
England and Wales
Judgment Date
31 July 2003
Procedural Posture
Civil Appeal (arbitration) / Appeal From Commercial Court Decision Remitting Arbitral Award Issues to Arbitrators Under Section 68 of the Arbitration Act 1996
Outcome
Appeal dismissed
Legal Topics
Arbitral Powers and Limits, Currency of Arbitral Awards, Interest on Arbitral Awards, Application of Substantive Vs Procedural Law, Interpretation of Arbitration Act 1996
Arbitration Contract Law Conflict of Laws Arbitral Powers and Limits Currency of Arbitral Awards Interest on Arbitral Awards Application of Substantive Vs Procedural Law Interpretation of Arbitration Act 1996

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Parties

Lesotho Highlands Development Authority

Claimant/respondent

Impregilo SPA and Others (Highlands Water Venture)

Defendants/appellants

Procedural Posture

Civil Appeal (arbitration) / Appeal From Commercial Court Decision Remitting Arbitral Award Issues to Arbitrators Under Section 68 of the Arbitration Act 1996

Legal Issues

  1. 1 Did the arbitrators exceed their powers under section 68 of the Arbitration Act 1996 by awarding sums in currencies and interest rates not provided for in the contract or applicable law?
  2. 2 Are the currency and interest components of an arbitral award matters of substantive or procedural law under the parties’ agreement and the Arbitration Act 1996?

Ratio Decidendi

The arbitrators exceeded their powers under section 68(2)(b) of the Arbitration Act 1996 by awarding sums in currencies and at interest rates not provided for in the contract or the law of Lesotho, which governed the contract. Both currency and interest were matters of substantive law under the parties’ agreement and the applicable law, not matters of procedural discretion under English law. The appeal was dismissed.

Court Disposition

Appeal dismissed

Orders

  • Appeal dismissed with costs (save counsels' fees to be considered by the costs judge)
  • Matters of currency and interest remitted to arbitrators to be determined in accordance with the contract and the law of Lesotho