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CJ leads panel in landmark rulings

Shawn Cumberbatch

CJ  leads panel in  landmark rulings

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Two business-related rulings, one with historic implications for the way arbitration is pursued when contracting parties have a dispute, have been made by Barbados’ highest domestic court.
 BARBADOS BUSINESS AUTHORITY has learnt that in one instance a Barbados Court of Appeal panel led by Chief Justice Sir Marston Gibson overturned the decision
of High Court Judge Randall Worrell, who determined that a sole arbiter should rule on a disagreement between E. Pihl & Sons and Brøndum A/S, two foreign companies involved in the redevelopment of the Grantley Adams International Airport more than ten years ago.
But Sir Marston and other appellate jurists dismissed another appeal involving Harlequin, developer of the stalled Merricks Resort in St Philip, and a contracted construction firm Cellate Caribbean Limited, which operated in Barbados and was hired to do work for Harlequin in St Vincent.
It was the airport arbitration matter, however, which the Court of Appeal  aid had major implications for commercial law in Barbados.
Court documents said: “The major bone of contention in the appeal is with the order of [Justice] Worrell that a sole arbitrator be appointed to resolve a dispute between the two parties to a construction contract, E. Pihl & Sons, the appellant, and Brøndum, the respondent.  The appellant maintains that by virtue of the terms of their contract, the court’s order should have been for the appointment of three arbitrators.
“This appeal is, we suspect, not without interest to commercial lawyers in Barbados for at least one good reason. It is that the appeal involves, apparently for the first time in Barbados, a consideration of Lord Hoffman’s well known restatement of the fundamental principles of contract interpretation in the English House of Lords case of Investors Compensation Scheme Ltd vs West Bromwich Building Society [1998] . . . in the context of an arbitration clause making provision for the appointment of arbitrators under the Arbitration Act, Cap. 110 (Cap. 110).”
The court said an important question to answer was whether Worrell decided one arbitrator should be appointed because of ambiguity in clause 20. 6 of the main contract which referred to “one or more arbitrators”.
The court acknowledged the clause could have been interpreted as ambiguous.
But in upholding the appeal and overturning Worrell’s decision, the Court of Appeal referred to the historic Lord Hoffman case in the English House of Lords, saying there was now “an unmistakable shift in approach to contractual interpretation, namely, a shift to ascertaining the contextual meaning of the relevant contractual language and away from literalism in the interpretative process”.
In the second court matter, Cellate recently failed to get the appellate court here to grant a stay against Harlequin’s US$52 million lawsuit against it and a number of its associates.
Sir Marston’s panel ruled that High Court Justice Jacqueline Cornelius acted appropriately when she refused the stay.
“She did not err in principle in her approach and she left nothing out of account or took account of anything of which she should not have taken account. She gave an extremely thoughtful and fair consideration of all the matters raised before her.  
“We are therefore far from persuaded that the exercise of her discretion in refusing the stay was tainted by any failure to balance the various factors in the scale.  
This is not a case where this court should interfere,” the Court of Appeal ruled.
Cellate had appealed on a number of grounds including its view that “the learned trial judge erred in law and/or in fact in failing to give any or any sufficient weight to the fact that the claim for fraudulent misappropriation is dependent on the finding by the trial judge as to whether the contract in respect of the Buccament Bay project in St Vincent and the Grenadines is a fixed-price contract or cost-plus contract”.
The court said it could overturn Cornelius’ decision only if it was shown “that the judge has either erred in principle in his approach or has left out of account or has taken into account some feature that he should, or should not, have considered, or that his decision was wholly wrong because the court is forced to the conclusion that he has not balanced the various factors fairly in the scale”.