Australian Foods v Pars Ram

The application for leave to appeal 61 Section 38 for the Commercial Arbitration Act 1984 is in the following terms: 38. Judicial review of awards (1) Without prejudice to the right of appeal conferred by subsection (2), the Court shall not have jurisdiction to set aside or remit an award on the ground of error of fact or law on the face of the award. (2) Subject to subsection (4), an appeal shall lie to the Supreme Court on any question of law arising out of an award. (3) On the determination of an appeal under subsection (2) the Supreme Court may by order: (a) confirm, vary or set aside the award; or (b) remit the award, together with the Supreme Court's opinion on the question of law which was the subject of the appeal, to the arbitrator or umpire for reconsideration or, where a new arbitrator or umpire has been appointed, to that arbitrator or umpire for consideration, and where the award is remitted under paragraph (b) the arbitrator or umpire shall, unless the order otherwise directs, make the award within 3 months after the date of the order. (4) An appeal under subsection (2) may be brought by any of the parties to an arbitration agreement: (a) with the consent of all the other parties to the arbitration agreement; or (b) subject to section 40, with the leave of the Supreme Court. (5) The Supreme Court shall not grant leave under subsection (4) (b) unless it considers that: (a) having regard to all the circumstances, the determination of the question of law concerned could substantially affect the rights of one or more parties to the arbitration agreement; and (b) there is: (i) a manifest error of law on the face of the award; or (ii) strong evidence that the arbitrator or umpire made an error of law and that the determination of the question may add, or may be likely to add, substantially to the certainty of commercial law. (6) The Supreme Court may make any leave which it grants under subsection (4) (b) subject to the applicant complying with any conditions it considers appropriate. (7) Where the award of an arbitrator or umpire is varied on an appeal under subsection (2), the award as varied shall have effect (except for the purposes of this section) as if it were the award of the arbitrator or umpire. 62 It can be seen that the first plaintiff needs leave under subsection (2) to appeal. The defendant concedes that section 38 (5) (a) is made out. It submits that there has been no demonstration of the factors in s 38 (5) (b). 63 In its further amended summons the first plaintiff identified the error of law as being "the manifest error of law on the face of the award is that the Tribunal did not consider the validity of the contract pursuant to which the defendant pursued its claim and obtain the award". A perusal of the award does not make reference to the first plaintiff's contentions that there was no concluded contract. That is not surprising given that the first plaintiff made no submissions. The reasons however do recite the detail of the contract and how it was made. This would tend to indicate that there was consideration given to the evidence before the arbitrators of what was the contract. 64 The defendants also submitted that any such error would not be manifest on the face of the award. Subsection 38 (5) in its current form was inserted in 1990. The provision, as amended, was discussed by the Court of Appeal in Promenade Investments Pty Ltd v State of New South Wales (1992) 26 NSWLR 203. "The expression 'error of law on the face of the award' is one of a type well-known to courts. The award having been examined the question is whether there is apparent (and such is the denotation of the word 'manifest') an error of law. 'Manifest error' is an expression sometimes used in reference to reasons given by judges or the approach taken by juries: see, eg, section 107(c) (iii) of the Supreme Court Act 1970 and the judgments of Kirby P in Azzopardi v Tasman UEB Industries Ltd (at 151) and Otis Elevators Pty Ltd v Zitis (1986) 5 NSWLR 171 at 181. It is used to indicate something evident or obvious rather than arguable: see generally per McHugh JA in Larkin v Parole Board (1987) 10 NSWLR 57 at 70-71."