Clarke and Others v Semenya NO and Others (24286/08) [2008] ZAGPHC 391 (5 December 2008)

Clarke and Others v Semenya NO and Others (24286/08) [2008] ZAGPHC 391 (5 December 2008)

The court found that the arbitrator misdirected himself in awarding costs to the respondents based on a mistaken view of substantial success, as the respondents failed to achieve their primary objective in the arbitration. The declaratory relief granted did not constitute substantial success, and the applicants were in fact the successful parties. The arbitrator's refusal to award costs to the first applicant was based on an invalid reason, namely joint legal representation, which is not a recognised ground for disentitlement. The costs award was thus vitiated by irregularity and misdirection. The court held that good cause existed for remittal under section 32(2) of the Arbitration Act,...

Citation
[2008] ZAGPHC 391
Parties
Applicant: Jeremy Edward Clarke; Applicant: Michael William Wright NO; Applicant: Doreen Valerie Salmon NO; Applicant: David Robert Buys NO; Applicant: Gold-Rose Investments (Pty) Ltd; Respondent: Ishmael Semenya NO; Respondent: Kwezi Group (Pty) Ltd; Respondent: Kwezi Mining (Pty) Ltd
Court
High Courts - Gauteng
Jurisdiction
South Africa
Judgment Date
5 December 2008
Case Number
24286/08
Procedural Posture
Review Application / Application for Review and Remittal of Arbitration Costs Award
Outcome
The costs award made by the arbitrator was set aside and the matter remitted for reconsideration of costs in light of the court's findings. The respondents were ordered to pay the costs of the review application, including the costs of two counsel.
Judges
FHD Van Oosten
Legal Topics
Arbitration Act 1965, Costs Award, Review of Arbitration, Shareholders Agreement, Remittal of Award
Civil Procedure Commercial and Corporate Arbitration Act 1965 Costs Award Review of Arbitration Shareholders Agreement Remittal of Award

Case Brief

Summary, issues, holding and outcome

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Parties

Jeremy Edward Clarke

Applicant

Michael William Wright NO

Applicant

Doreen Valerie Salmon NO

Applicant

David Robert Buys NO

Applicant

Gold-Rose Investments (Pty) Ltd

Applicant

Ishmael Semenya NO

Respondent

Kwezi Group (Pty) Ltd

Respondent

Kwezi Mining (Pty) Ltd

Respondent

Procedural Posture

Review Application / Application for Review and Remittal of Arbitration Costs Award

Legal Issues

  1. 1 Whether the arbitrator's costs award was vitiated by irregularity or misdirection.
  2. 2 Whether the arbitrator failed to exercise discretion judicially in refusing costs to the first applicant.
  3. 3 Whether the costs award should be remitted for reconsideration under section 32(2) of the Arbitration Act 42 of 1965.

Ratio Decidendi

The court found that the arbitrator misdirected himself in awarding costs to the respondents based on a mistaken view of substantial success, as the respondents failed to achieve their primary objective in the arbitration. The declaratory relief granted did not constitute substantial success, and the applicants were in fact the successful parties. The arbitrator's refusal to award costs to the first applicant was based on an invalid reason, namely joint legal representation, which is not a recognised ground for disentitlement. The costs award was thus vitiated by irregularity and misdirection. The court held that good cause existed for remittal under section 32(2) of the Arbitration Act,...

Court Disposition

The costs award made by the arbitrator was set aside and the matter remitted for reconsideration of costs in light of the court's findings. The respondents were ordered to pay the costs of the review application, including the costs of two counsel.

Orders

  • Paragraph (c) of the arbitrator's award dated 24 June 2008 is set aside.
  • The matter is referred back to the arbitrator for reconsideration of the costs award in light of the court's findings, including the applicants' success and the first applicant's entitlement to costs.