Mangaung Metropolitan Municipality v Lesole Agencies CC; In re: Lesole Agencies CC v Mangaung Metropolitan Municipality (4772/2015) [2017] ZAFSHC 103 (14 June 2017)

Mangaung Metropolitan Municipality v Lesole Agencies CC; In re: Lesole Agencies CC v Mangaung Metropolitan Municipality (4772/2015) [2017] ZAFSHC 103 (14 June 2017)

The court found that the municipality was barred from applying for a stay of proceedings under section 6 of the Arbitration Act because pleadings had already closed and further steps had been taken in the litigation, including a rule 37 conference. The municipality failed to act timeously when the dispute arose and only brought the application nearly two years later. The agreement did not contain an unambiguous mandatory arbitration clause, and the animosity between the parties made it unlikely that arbitration would resolve the dispute efficiently. The application was therefore dismissed with costs.

Citation
[2017] ZAFSHC 103
Parties
Applicant: Mangaung Metropolitan Municipality; Respondent: Lesole Agencies CC; Plaintiff: Lesole Agencies CC; Defendant: Mangaung Metropolitan Municipality
Court
Free State High Court, Bloemfontein
Jurisdiction
South Africa
Judgment Date
14 June 2017
Case Number
4772/2015
Procedural Posture
Stay Application / Opposed Motion for Stay of Proceedings Pending Arbitration
Outcome
Application dismissed with costs.
Judges
J.P. Daffue
Legal Topics
Arbitration Agreement, Stay of Proceedings, Special Plea, Arbitration Act Section 6, Contractual Dispute
Civil Procedure Commercial and Corporate Arbitration Agreement Stay of Proceedings Special Plea Arbitration Act Section 6 Contractual Dispute

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Parties

Mangaung Metropolitan Municipality

Applicant

Lesole Agencies CC

Respondent

Lesole Agencies CC

Plaintiff

Mangaung Metropolitan Municipality

Defendant

Procedural Posture

Stay Application / Opposed Motion for Stay of Proceedings Pending Arbitration

Legal Issues

  1. 1 Whether the proceedings should be stayed pending arbitration as per the alleged agreement.
  2. 2 Whether the municipality is entitled to relief under section 6 of the Arbitration Act or common law at this stage.
  3. 3 Whether the written agreement contains a binding arbitration clause obliging referral to arbitration.

Ratio Decidendi

The court found that the municipality was barred from applying for a stay of proceedings under section 6 of the Arbitration Act because pleadings had already closed and further steps had been taken in the litigation, including a rule 37 conference. The municipality failed to act timeously when the dispute arose and only brought the application nearly two years later. The agreement did not contain an unambiguous mandatory arbitration clause, and the animosity between the parties made it unlikely that arbitration would resolve the dispute efficiently. The application was therefore dismissed with costs.

Court Disposition

Application dismissed with costs.

Orders

  • The application to stay proceedings pending arbitration is dismissed.
  • The applicant is ordered to pay the costs of the application.