Mageza Samuels Incorporated v North West Housing Corporation (M168/16) [2017] ZANWHC 74 (13 September 2017)

Mageza Samuels Incorporated v North West Housing Corporation (M168/16) [2017] ZANWHC 74 (13 September 2017)

The court found that the dispute between the parties is subject to an arbitration agreement contained in the service level agreement. The arbitrator has not yet ruled on his jurisdiction or the constitutional issues raised in the amended plea. The applicant failed to discharge the onus of showing compelling reasons why the matter should not be referred to arbitration. The court held that the arbitrator is competent to inquire into his own jurisdiction and that the proceedings before the court should be stayed pending the outcome of the arbitration. Costs were awarded to the respondent as the successful party.

Citation
[2017] ZANWHC 74
Parties
Applicant: Mageza Samuels Incorporated; Respondent: North West Housing Corporation
Court
North West High Court, Mafikeng
Jurisdiction
South Africa
Judgment Date
13 September 2017
Case Number
M168/16
Procedural Posture
Stay Application / Application for Stay of Proceedings and Referral to Arbitration
Outcome
Application dismissed; proceedings stayed and matter referred to arbitration. Costs awarded to respondent.
Judges
R D Hendricks
Legal Topics
Arbitration Agreement, Stay of Proceedings, Jurisdiction of Arbitrator, Constitutional Validity of Contract
Civil Procedure Commercial and Corporate Arbitration Agreement Stay of Proceedings Jurisdiction of Arbitrator Constitutional Validity of Contract

Case Brief

Summary, issues, holding and outcome

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Parties

Mageza Samuels Incorporated

Applicant

North West Housing Corporation

Respondent

Procedural Posture

Stay Application / Application for Stay of Proceedings and Referral to Arbitration

Legal Issues

  1. 1 Whether the respondent's amended plea raising constitutional invalidity of the contract is irregular, mala fide, and should be set aside.
  2. 2 Whether the proceedings before the court should be stayed and the matter referred back to arbitration in terms of the service level agreement.

Ratio Decidendi

The court found that the dispute between the parties is subject to an arbitration agreement contained in the service level agreement. The arbitrator has not yet ruled on his jurisdiction or the constitutional issues raised in the amended plea. The applicant failed to discharge the onus of showing compelling reasons why the matter should not be referred to arbitration. The court held that the arbitrator is competent to inquire into his own jurisdiction and that the proceedings before the court should be stayed pending the outcome of the arbitration. Costs were awarded to the respondent as the successful party.

Court Disposition

Application dismissed; proceedings stayed and matter referred to arbitration. Costs awarded to respondent.

Orders

  • The proceedings under case number M168/16 filed in this Court are stayed pending finalization of the arbitration hearing.
  • The counter application is upheld.