Pro-Khaya Construction CC v Strata Civils and Others (2889/2017) [2018] ZAECPEHC 11 (1 March 2018)

Pro-Khaya Construction CC v Strata Civils and Others (2889/2017) [2018] ZAECPEHC 11 (1 March 2018)

The court found that the applicant failed to discharge the onus of showing compelling reasons for terminating the arbitration agreements. The advanced stage of the arbitrations, the absence of allegations of fraud or misconduct, and the availability of alternative remedies such as consolidation or joinder weighed against termination. The court held that the inconvenience of parallel proceedings and the poor quality of the record did not constitute sufficient grounds. The applicant's concerns regarding the separation of its counter-claim were no longer relevant, as the arbitrator had agreed to adjudicate the counter-claim. Accordingly, the application was dismissed.

Citation
[2018] ZAECPEHC 11
Parties
Applicant: Pro-Khaya Construction CC; Respondent: Strata Civils; Respondent: Tony Ashford; Respondent: JDM Drilling (Pty) Ltd; Respondent: Willem Henrik Olivier
Court
Eastern Cape High Court, Port Elizabeth
Jurisdiction
South Africa
Judgment Date
1 March 2018
Case Number
2889/2017
Procedural Posture
Urgent Application / Application to Terminate Arbitration Agreements Prior to Trial
Outcome
Application dismissed with costs.
Judges
NG Beshe
Legal Topics
Arbitration Agreement Termination, Good Cause Requirement, Parallel Proceedings, Consolidation of Arbitrations
Civil Procedure Alternative Dispute Resolution Arbitration Agreement Termination Good Cause Requirement Parallel Proceedings Consolidation of Arbitrations

Case Brief

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Parties

Pro-Khaya Construction CC

Applicant

Strata Civils

Respondent

Tony Ashford

Respondent

JDM Drilling (Pty) Ltd

Respondent

Willem Henrik Olivier

Respondent

Procedural Posture

Urgent Application / Application to Terminate Arbitration Agreements Prior to Trial

Legal Issues

  1. 1 Whether the applicant has shown good cause for the termination of two arbitration agreements under section 3(2)(c) of the Arbitration Act.
  2. 2 Whether the existence of parallel proceedings and poor quality of the arbitration record justify termination.
  3. 3 Whether the advanced stage of the arbitrations and available alternative remedies preclude termination.

Ratio Decidendi

The court found that the applicant failed to discharge the onus of showing compelling reasons for terminating the arbitration agreements. The advanced stage of the arbitrations, the absence of allegations of fraud or misconduct, and the availability of alternative remedies such as consolidation or joinder weighed against termination. The court held that the inconvenience of parallel proceedings and the poor quality of the record did not constitute sufficient grounds. The applicant's concerns regarding the separation of its counter-claim were no longer relevant, as the arbitrator had agreed to adjudicate the counter-claim. Accordingly, the application was dismissed.

Court Disposition

Application dismissed with costs.

Orders

  • The application to terminate the arbitration agreements is dismissed.
  • The applicant is ordered to pay the costs of the application.