Croft J noted that the fact that a party did not make a request under s 33(5) for an issue to be the subject of a further award may be relevant to the court’s discretion in a setting aside application by that party under s 34. As s 33(5) had no application in the present case, this was not a relevant consideration. His Honour also noted that a party may request an additional award (under s 33(5)) and apply for an award to be set aside (under s 34) simultaneously. Turning to L’s stay application, Croft J observed that unless the Court found that the arbitration agreement was inoperative or incapable of being performed, it was obliged to stay B’s application to the court for it to determine the remaining issue. His Honour noted that “inoperative or incapable of being performed”, for the purposes of s 8, was a high bar to satisfy. Practical impossibility as opposed to mere inconvenience was required: [34] Croft J rejected the submission that an arbitration agreement is inoperative when an arbitrator determines not to decide all of the matters contained in the reference to arbitration: [37]. Indeed, the fact that an arbitrator is rendered functus officio does not result in an arbitration agreement being inoperative or incapable of being performed: [14]. Thus, whether the arbitrator was functus officio was irrelevant for the purposes of L’s stay application: [37]. Consequently, B’s application to set aside part of the award failed, and L’s application for a stay succeeded. The Court concluded that the arbitrator’s mandate continued to determine the remaining issue, and that either party could apply to the arbitrator to re-engage the arbitral process to determine that issue.
Comment Accepting for the moment that the arbitrator decided, expressly, not to decide the Supreme Court costs claim “at that time on the then available evidence”, it is incongruous that he styled his award as a Final Award and made no directions for the later determination of the outstanding issue. Indeed, it is surprising that the arbitrator neither requested further evidence before delivering his Final Award nor decided the issue on the available evidence. Nevertheless, the judgment is instructive in illuminating, amongst other things, what constitutes a final award and the operation of ss 33(5) and 34(2)(a)(iii) of the CAA.
Albert Monichino QC Albert practises as a barrister, arbitrator and mediator practicing in Australia. He has over 20 years experience. He is a Grade 1 arbitrator and is accredited as an advanced mediator. He was appointed Senior Counsel in 2010. Albert is also on the NZDRC and NZIAC Panels of Arbitrators and Mediators.
To read more about Albert, visit the NZDRC website.