Gingis v Mount Scopus Memorial College Ltd [1998] VSCA 49

Court of Appeal (Vic)|1998-09-09|Before: TADGELL, PHILLIPS and CHARLES, JJ.A.

ARBITRATION - Rabbinical arbitration - Award - Stay of judicial proceedings - Step in proceedings - Award must be final, certain and complete determination - Uncertainty - Principles of construction of arbitral award.

I shall invite Charles, J.A. to deliver the first judgment.

The action was tried by a judge of the County Court over some three weeks, the appellants appearing in person. On 13 May 1997 the learned judge gave judgment for the school in the sum of $45,196 plus interest of $4,519 and costs to be taxed on County Court Scale C. The appellants do not appeal from the substantive decision of his Honour that the school was entitled to its claim in full, or from the conclusion of the trial judge that -

"It follows that the defendants were the authors of their own problems with respect to their indebtedness to the plaintiff. Had the defendants supplied sufficient information and been frank and open, they probably would have received a fee subsidy in respect of the fees charged in 1990. Had they made application for a fee subsidy for the school year 1991, and for the school year 1992, and supplied the requisite information in each case, they probably would have received a substantial fee subsidy in respect of each such year. They did not do so, and have only themselves to blame for the invidious position in which they now find themselves.

The plaintiff is entitled to its claim in full, in the sum of $45,196.00."

The appellants contended that the court did not have jurisdiction to hear and determine the school's claim against the appellants as that claim had previously been decided by an arbitral award made in an Ecclesiastical Arbitration constituted by Rabbi Heilbrunn. The award is said to have been made by letter dated 6 March 1995.

The matter of the court's entitlement to hear the school's claim was raised as an issue by the appellants at the trial. The learned judge, after hearing lengthy evidence and argument, concluded that the Rabbi did not make an award and that the court accordingly had jurisdiction to proceed with the school's claim, saying -

"I am satisfied that Rabbi Heilbrunn did not make an award in the terms relied on by the defendants in paragraph 2 of their defence, or for that matter make an award at all. Elements of certainty, completeness and finality are absent. Further, whilst having reached the above conclusion, it is unnecessary for me to consider other aspects of the arbitration, I am satisfied that the arbitrator failed to act judicially in the conduct of the arbitration, to such an extent, as to render any purported award made invalid."

The learned judge found that the parties had agreed in writing on 4 August 1994 to submit their disputes to arbitration by Rabbi Heilbrunn, and that the arbitration agreement provided, inter alia, that -

(a) the arbitration was to be conducted as an Ecclesiastical Court;

(b) any order, award and final determination was to be final and binding on the parties;

It was common ground that the issues to be arbitrated included:

(i) the liability of the appellants to pay the school the sum claimed or any part thereof;

(ii) the financial ability of the appellants to pay the amount found to be due; and

(iii) the terms and conditions of payment of any amount found to be due.

During the trial, Rabbi Heilbrunn said in evidence that he had made a finding and/or an award on 31 October 1994 in writing. The document was in the following terms:

"'[P]ay when you can, if you can ... 'not conclusively proved.

At best this amounts to humane and sympathetic treatment in line with the College's policy to be as helpful as possible.

All such help is based on a proven need established by a full and frank disclosure which the College established was never satisfactorily complied with.

Therefore Mr & Mrs Gingis are liable to the full amount subject to the following:

It is possible that the Gingis family do in fact have difficulties to pay the full amount. If so they must establish this by a full, frank and complete disclosure of their complete financial situation to me for all the relevant times that they had children at the College and were permitted fee reductions.

If a special situation of need is established Mr & Mrs Gingis is (sic) invited to make the College a substantial offer.

If the offer is either not made or in the view of the College subject to my judgement is not acceptable then I shall make a determination of the amount myself.

[As a guide, the following could amount to a reasonable offer] (see Annexure 'A')

At present (that is before any disclosure) I would be inclined to consider that an amount based on the previous concessional arrangements, plus 10% should be paid, immediately, or in substantial repayments. The 10% additional amount relates to the fact that it would be unjust for Mr Gingis to benefit from his failure to fully disclose his financial position as if he had made the disclosure.

Of course if Mr Gingis conclusively proves to my satisfaction partial or complete inability to pay, I shall make a determination based on his disclosures. This would amount to a deferral based on proper security for a period of time and on such terms as I will determine.

Failure by Mr and Mrs Gingis to substantially comply with the procedure outlined by the 15th December 1994 will entitle Mt Scopus College to pursue its rights wherever those may legally be obtained subject to my approval which will not lightly be withheld.

I interpolate that the school had a policy that no Jewish child would be refused Jewish education at the school because the parents of the child genuinely lacked the means to pay the prescribed school fees. In furtherance of that policy the parents of a child enrolled at the school were able to make application to the school for what was described as a fees concession, or fee subsidy. Such concession amounted in practice to a reduction in, or waiver of, the prescribed school fees. The first three paragraphs of Rabbi Heilbrunn's document of 31 October 1994 relate to this policy, and to a claim made by the appellants that there was an agreement allegedly made with a Mrs Kovacs, a finance officer employed by the school, that they were required to pay "what you can and when you can".

A meeting took place on 22 November 1994 between Rabbi Heilbrunn and Mr Gingis (the first appellant), when Mr Gingis submitted financial documents to the Rabbi, and at the meeting the Rabbi said he would notify Mr Gingis, in writing, when he had confirmed that the correct amount due to the school was $12,120. The school alleged that it was not informed by the Rabbi that he intended to meet Mr Gingis on 22 November 1994, nor was it informed of what took place at the meeting.

Mr Gingis subsequently made several requests to the Rabbi for him to notify Mr Gingis in writing of the correct amount said to be due, but the Rabbi failed to do so. The Rabbi however set out in writing his calculations as to how the sum of $12,120 was arrived at, stating that Mr Gingis acknowledged he was liable for this sum, and further noting that Mr Gingis had deposited financial documents with him for "analysis of ability to pay".

On 14 January 1995 the Rabbi wrote a letter to the appellants requesting them to provide further financial information by 22 February 1995. The Rabbi by this letter informed the appellants that the document submitted regarding their financial situation had been found not to be sufficiently complete to form a basis for a proper assessment and also said that the appellants had not fully complied with the Rabbi's order. The letter said that if the information required was not provided or an arrangement for payment made by 22 February 1995 permission would be granted to the school to pursue its claims wherever they might legally do so.

On 6 February 1995 the school's solicitor sent a letter by facsimile to Rabbi Heilbrunn referring to the findings of the Rabbi made "in respect of a Rabbinical Arbitration" and stating, inter alia, that the appellants were required to put forward an offer of payment which the Rabbi had suggested be along the lines of Annexure "A". In that letter the solicitors pointed out that if the appellants failed to comply substantially by 15 December 1994 with the procedure outlined by the Rabbi the school was to be entitled to pursue its rights wherever they might legally be obtained subject to the Rabbi's approval. The letter noted that no offer had been received from the appellants nor any disclosure of any nature whatsoever as to a partial or complete inability to pay.

A further meeting took place between the Rabbi and Mr Gingis on a date between 14 February and 6 March 1995, at which a Mr Hain was present. Again the school alleged that it was not informed that such meeting was to take place, nor at any relevant time was the school informed as to what had taken place at that meeting.

On 6 March 1995, Rabbi Heilbrunn wrote the letter to the appellants upon which they now rely as an award. The letter, a copy of which was forwarded to the school, was in the following terms -

"From documents presented to me I am satisfied that Mr and Mrs Gingis are in no position to repay their debt at present.

It is fairly likely that Mr Gingis will lose the family home in the very near future through a Court repossession order.

I therefore find that Mr Gingis owes the principal debt as described in my original findings but has no ability to pay it at present.

I order that when Mr Gingis finds employment or begins to earn an income that his situation and ability to repay the debt be re-assessed.

In order to facilitate the above it would be necessary to review the situation at least once a year or more frequently at the instance of Mt. Scopus College in order to reasonably fulfil that requirement.

Mr and Mrs Gingis will be obliged to cooperate and fulfil this requirement and failure to do so will immediately entitle Mt. Scopus College to take action whenever it may legally do so, subject to application to me.

This has been an exceedingly difficult case and I believe that much of the trauma to which all have been subject could have been avoided had the documents and information I have now been shown been made available earlier.

As a gesture of good faith it would therefore be appropriate that when Mr Gingis' ability to pay improves, he takes the initiative to begin repayment of his debt."

What thereafter followed was that on 3 November 1995 a telephone conversation took place between the Rabbi and Mr Gingis. Then on 11 December 1995 the school's solicitors wrote to the Rabbi enquiring whether he had completed his review and determination. On 7 February 1996 the Rabbi wrote to Mr Gingis and informed him that he, the Rabbi, would no longer adjudicate in the dispute. In that letter the Rabbi said he had received an urgent enquiry from the school regarding the progress of the case. The letter included the statement that the Rabbi felt that Mr Gingis had used his (the Rabbi's) office in order to delay or avoid his (Mr Gingis's) obligations. On 15 February 1996 Mr Gingis wrote to the Rabbi requesting him to confirm "that the correct figure is $12,120"; to this letter the Rabbi replied on 29 February 1996, informing Mr Gingis that the Rabbi could not respond to him because he no longer had jurisdiction in the matter.

Mr Kaufman, Q.C., who appeared in this Court with Mr Baker for the appellants, at first submitted that it was not open to the learned judge to make a finding that the award made by Rabbi Heilbrunn in the terms of paragraph 2 of the defence was not a valid award because elements of certainty, completeness and finality were absent. He submitted that the respondent could only apply to the Supreme Court under s.38(2) of the Act and that such an application could not be made to the County Court.

As to this argument, it is necessary to bear in mind that the appellants did not at any time before or at the trial make application for a stay of the proceedings (nor was any question raised that the decisions of 31 October 1994 or 6 March 1995 were in any sense interim awards). The appellants filed a defence which, as I have said, relied on the fact that the parties had agreed to submit their disputes to arbitration, and asserted that the arbitrator had handed down his decision on 6 March 1995, "which decision the [appellants] abide by". The appellants then took a number of further steps in the action, including serving further particulars of their defence which asserted that the arbitrator had determined that the correct amount of the respondent's claim was $12,120. In their defence they had denied that they were indebted to the school in the amount claimed or at all. At trial, the parties first argued before the learned judge what was described as the point as to jurisdiction, but thereafter both the appellants and the school called witnesses and dealt with the merits of the school's claim. In these circumstances the time had long passed when the appellants might have been entitled to apply for the school's action to be stayed (see Turner & Goudy v. McConnell [1985] 1 W.L.R. 898). In my view the appellants cannot now argue that the school's only course was to seek leave to appeal to the Supreme Court under s.38(2) of the Act, or that it was not open to the judge to deal with the question they raised. The appellants made their choice and embarked on the process of fighting the case on its merits. They took their chance and failed in this process. I should add that, during argument, Mr Kaufman withdrew his reliance on s.38(2). The first argument accordingly fails.

The second issue argued in this Court was whether Rabbi Heilbrunn had made an award which was binding. In Dobbs v. National Bank of Australasia [1935] HCA 49; (1935) 53 C.L.R. 643, Rich, Dixon, Evatt and McTiernan, JJ. said at 653 -

"If before the institution of an action, an award was made, it governed the rights of the parties and precluded them from asserting in the courts the claims which the award determined. By submitting the claim to arbitration, the parties confer upon the arbitrator an authority conclusively to determine them. That authority enables him to extinguish an original cause of action."

"A valid award was recognised by the courts as precluding recourse to the original rights the determination of which had been referred to arbitration."

If Rabbi Heilbrunn made an award on 6 March 1995, the school was accordingly precluded from seeking recourse to the County Court (which would have been without jurisdiction to hear the action as framed), or at least from doing other than seeking to enforce the award.

As to this, Mr Golvan, Q.C., who appeared with Mr Holzer for the school, argued in written submissions that on no reasonable construction could the letter dated 6 March 1995 be said to constitute an award. He submitted that it was not a cogent, final or certain determination intended to dispose of the disputes referred for arbitration; rather the letter contained observations by the Rabbi on documents and information presented to him by the appellants; and that observations, recommendations and expressions of expectation do not constitute a binding and enforceable award. Mr Golvan's submissions continued that the letter lacked the necessary substantive ingredients of a valid award, since it lacked certainty, completeness and finality, and was not enforceable as a binding award. Reliance was placed on the fact that the amount to be paid was not specified, the terms and conditions of repayment of the amount due by the appellants to the school had not been stipulated with certainty and the letter was uncertain in its effect.

Mr Kaufman submitted to the Court, correctly in my view, that the Court should adopt the construction most favourable to the preservation of the award and should support the validity of the award if it is reasonably possible to do so; see Wood v. Griffith (1818) 1 Swan.43, per Lord Eldon, L.C. at 52 [1818] EngR 238; (36 E.R. 291, 294). As Diplock, L.J. said in Giacomo Costa Fu Andrea v. British Italian Trading Co. Ltd. [1963] 1 Q.B. 201, at 218 -

"I strongly deprecate ... any suggestion that awards made by commercial arbitrators have got to be examined with a toothcomb to make sure that they have used the exactly correct technical legal terms of art. As long ago as 1835, in Eardley v. Steer [(1835) 4 L.J.Ex.293] the court expressed a similar view to that which I have expressed on that matter. As long as the meaning is clear, the award is a good one."

See also the "T.F.L. Prosperity" [1982] Ll.R.617, at 625, per Bingham, J.; and A.V. Jennings Industries (Australia) Ltd. v. Roman Catholic Bishop of Perth [1967] W.A.R. 3, at 7-8 per Negus, J.

The appellants' outline in effect relied on the Rabbi's letter of 6 March 1995 as a final determination that the correct amount of the school's claim was $12,120. The notice of appeal put in issue principally the failure of the judge to find that the appellants' indebtedness had been decided by the letter of 6 March, and in failing to find that this "award" was final and binding on the school. Before this Court, however, Mr Kaufman adopted a very different course. Mr Kaufman argued that the Rabbi had never completed his arbitration, that the award of 6 March 1995 was, in effect, an interim award (although binding as far as it went), and that the answers to the questions referred to him were -

(a) the full amount claimed by the school's solicitors, whatever that was;

(b) the appellants had no ability to pay any part of that sum as at 6 March 1995;

(c) the inability to pay was to be reviewed at least annually, or earlier at the school's instance, and the terms and conditions of payment would be determined accordingly, subject to the fact that a failure on the part of the appellants to co- operate in any such review would entitle the school to proceed immediately, by any means the school chose.

The first point to be made about this argument is that it was not the defence pleaded, nor the defence litigated before the trial judge. I doubt whether it is raised in any form by the notice of appeal. But the second, and more serious, difficulty is, it seems to me, that the answers to the issues, if they can properly be gleaned from the Rabbi's letters, provide no defence to the school's action. The award, on this view, was made on 6 March 1995. If it was to be reviewed annually, the award merely spoke as to the appellants' inability to pay as at 6 March 1995. Rabbi Heilbrunn withdrew from the arbitration on 7 February 1996. When the school commenced proceedings in the County Court, the appellants did not seek to stay the action on the ground that the arbitration was continuing. The decision of 6 March 1995, on the appellants' argument, found that the school was entitled to its full claim which counsel asserted was $44,196 (the amount claimed in the letter dated 29 April 1994 from the school's solicitors); and that the appellants were unable to pay any of this amount as at that date but without saying anything as to their ability to pay as at 20 March 1996, the date when proceedings were commenced in the County Court. If the ability of the appellants to pay and terms of payment were to be reconsidered annually, the supposed answers to the second and third issues, for one reason or another, did not preclude the school from taking the proceedings that were then initiated.

Section 28 of the Act provides that the award of an arbitrator "shall, subject to this Act, be final and binding on the parties to the agreement". Consistently with the wording of this section, it is well-established that, to be valid, an award must be final, certain and complete; Mustill & Boyd, Commercial Arbitration, 2nd ed., 1989, 384-388; Russell on Arbitration, 21st ed., 1997, 277-284; Jacobs, Commercial Arbitration Law and Practice, 6822-5; Sharkey & Dorter, Commercial Arbitration, 1986, 246-7.

In Lock v. Vulliamy [1833] EngR 828; (1833) 5 B. & Ad. 600; 110 E.R. 912, an arbitrator of a dispute between an architect and his clerk, in relation to a claim by the clerk for wages, stated in a letter that he had examined drawings made by the clerk, with an account of the time, which did not show experience or ability to the extent to justify a demand for remuneration, but in consideration of the clerk's services out of the office on some occasions, and to meet the case in a liberal manner, proposed that the architect should pay the clerk 10 l. Denman, C.J. said as to this (at 602) that -

"The arbitrator seems to have thought that the instruction received by the plaintiff was a compensation for the first set of services; but as to the second, he has come to no decision, but merely makes a proposal that the defendant, to meet the circumstances in a liberal manner, should pay 10 l. That is a mere suggestion to the defendant to pay that sum if he is disposed to act liberally. It is not an expression of an opinion that Lock was entitled of right to recover that sum. I agree that no precise form of words is necessary to constitute an award. It is sufficient if the language be such as to show clearly that the arbitrator has come to a decision upon the points submitted to him. ... Here the arbitrator has not decided, but merely suggested that the one party, if he meant to do a liberal thing, should pay 10 l. to the other."

So also, in Watson v. Watson (1648) Sty 28, 56; [1658] EngR 739; 82 E.R. 504, 526, where an award directed that one of the parties should pay so much money to the other as should be due in conscience, it was held that the award was neither certain nor final. Lock v. Vulliamy was applied by Brownie, J. in Wytarra Pty. Ltd. v. Maunganui Pty. Ltd. (unreported, Supreme Court of New South Wales, 22 May 1989) in circumstances where it was held that what the arbitrator had done in relation to the making of the supposed award was -

"making a recommendation as to the compromise of a then five-and-a-half year-old dispute, rather than making a final determination of the rights of the parties. ... What Mr Stevens was there saying was that he had not attempted to finally resolve the rights of the parties, rather he had picked out those items to the advantage or disadvantage of each party which seemed to him to be significant and had not paused to take the expensive and time-consuming step of examining the other matters."

See also S. & S. Constructions Pty. Ltd. v. Fulop [1966] VicRp 57; [1966] V.R. 401, at 401-402 per Winneke, C.J., Adam and Gillard, JJ.

As to the three issues referred for arbitration, for myself I would doubt that Rabbi Heilbrunn's letters can fairly be read as deciding with certainty what was the amount of any liability on the part of the appellants to the school. The decision of 6 March 1995 states that "Mr Gingis owes the principal debt as described in my original finding", but the "original finding" is not identified. It might be the sum of $12,120 which the Rabbi and Mr Gingis may have fixed on later, and for which Mr Gingis contended below. Alternatively it might be the sum of $24,406, referred to in Annexure A. Alternatively it might be the figure of $44,196 claimed in the letter of 29 April 1994, although this was not, as I understand it, argued by either party before the trial judge. As to the second issue it is, I think, arguable that the Rabbi determined that the appellants had no ability then (i.e. at 6 March 1995) to pay anything, but the answer was clearly not intended to be a final one - it was explicitly subject to annual review - and it is not clear whether the decision was that the appellants could pay nothing at that time, or rather that they could not pay the full amount of their indebtedness (whatever that might be). No answer at all was given in relation to the third issue, the terms and conditions of payment of any amount that might have been found to be due, as Mr Kaufman conceded during argument.

In my view the learned judge correctly concluded that the elements of certainty, completeness and finality were all absent from the documents relied on by the appellants as constituting the supposed award, and indeed that Rabbi Heilbrunn did not make any award at all. I should add that the view that no final award was made by the Rabbi, nor considered by the parties themselves to have been made, is supported by the later history of the parties' actions after 6 March 1995. The learned judge concluded on the evidence that in February 1996 Rabbi Heilbrunn decided to withdraw from the arbitration and on 7 February 1996 wrote a letter to the appellants confirming his withdrawal. In my view his Honour ruled correctly that the Rabbi withdrew from the arbitration before making a valid award.

In all these circumstances, this appeal should be dismissed.

By their statement of defence the appellants, as defendants in the County Court, asserted that "... the County Court of Victoria has no jurisdiction to try and determine this action by virtue of the parties having previously agreed to submit the matter to arbitration". In strictness, that assertion might properly have been struck out because, apart from statute, a contract providing for arbitration cannot of itself prevent the institution of an action or suit: In Re Smith & Service and Nelson & Sons (1890) 25 Q.B.D. 545 at 554, per Bowen, L.J.; Dobbs v. National Bank of Australasia Ltd. [1935] HCA 49; (1935) 53 C.L.R. 643 at 653, in a passage immediately preceding the first of those from that case that has been read by Charles, J.A. Nevertheless the respondent, perhaps wisely, did not seek to strike out the assertion but sought particulars of it. From the particulars purportedly supplied it appears that the appellants relied not upon a submission to arbitration but upon "the decision handed down by Rabbi Heilbrunn as Arbitrator on or about 6.3.1995". The so-called "decision" was evidently relied on as an arbitral award, for the particulars continued: "The Defendants believe that a copy of the Award of the Arbitrator is in the possession of the Plaintiff."

By their Notice of Appeal the appellants challenged the judge's decision on a number of bases, and Mr Kaufman this morning sought to impugn the decision by means of several arguments, some of which he abandoned in running. There is, however, in my opinion, really only one simple question for us. It is whether there was an arbitral award which governed the rights of the parties so as to preclude the respondent from asserting in the County Court a claim which the award allegedly determined: Dobbs v. National Bank of Australasia Ltd. at 653.

I agree that the learned judge was correct to say that there was no such award. The respondent's statement of claim was in an attenuated form but it may be taken to have made a claim for $45,196 founded in contract for the provision of educational services. That, I think, must have been the way it was understood in the action below. The submission to arbitration was itself in writing, but the issues or questions that were referred to arbitration pursuant to the submission were apparently not reduced to writing. It is, however, now common ground that the questions referred included those which Charles, J.A. has read and designated (i), (ii) and (iii). The answer to question (i) provided by the Rabbi in his letter of 6 March 1995 did not, I consider, do more than say that the appellants were then liable to pay to the respondent the sum that the respondent then claimed. It is not possible to say that the Rabbi assigned any quantification to the liability or, if he did, what the quantum was. The answer to question (ii) was, to interpret it most favourably to the appellants, that they had no ability at 6 March 1995 to pay whatever sum they were then liable to pay or any part of that sum. The answer said nothing about the future ability of the appellants to pay. I should doubt - although on the view I take of the case it is not strictly relevant - that these two answers (i) and (ii) can properly be taken to be final in any relevant sense. As to question (iii), if the Rabbi may be taken to have given any definite or certain answer it cannot, in my opinion, be treated as a final one.

Neither any one of the answers of the Rabbi taken individually nor all three together can, in my opinion, be treated as sufficient to constitute an award such as to afford a defence to the respondent's action on the contract. If the respondent had sought to enforce what the appellants now claim to be an award, no cogent or certain liability of the appellants could be spelt out of it. If there is nothing for the respondent to enforce, there can be nothing upon which the appellants may rely.

I agree that the appeal should be dismissed, and I shall attempt to state shortly my own reasons for arriving at that result.

Having regard to the way in which the argument for the appellants was put by senior counsel, I think the appeal may be resolved according to whether the arbitrator made any, and if so what, award on 6 March 1995. In the County Court, the appellants relied upon the making of an award on 6 March to deny jurisdiction to the County Court, by which was meant, as I follow it, that the County Court could not proceed otherwise than in accordance with the award. It was said that the award made on 6 March was final and bound the parties and, by implication, that, by the court proceeding instituted by it, the respondent was acting in disregard of the award by which it was bound.

The first step in the appellants' argument therefore is to establish that on 6 March 1995 an award was made by the arbitrator and the second step is to establish that the terms of that award were such as to preclude the respondent's proceeding by its court action. On a very generous interpretation, the letter of 6 March 1995 might be read and understood as amounting to a determination that the appellants owed to the school the sum claimed by the school from them (although what that sum was was not quantified in the letter of 6 March); that at present they had no ability to pay that sum or any part thereof; that their ability to pay should be subject to annual review; that the terms and conditions for payment would be determined in due course according to ability to pay; and that any failure by the appellants to co-operate in determining ability to pay would mean that the sum owing would be payable forthwith and that the school might take action to recover that sum, subject to application in that behalf to the arbitrator. It seems to me unnecessary to determine whether this is a proper interpretation of the letter of 6 March, whether the letter amounts in truth to an award either wholly or in part, or whether it can properly be said to have been final. I say that it is unnecessary to decide these things because, as the case was argued, I cannot see that the "award" stood at all in the way of the respondent's recovering in its County Court action.

Appellants' counsel submitted that the award made on 6 March 1995 was final in so far as it determined that the appellants owed the school the sum claimed by it and that they had no present ability to pay that sum or any part of it. For the rest, he submitted, it was an interim award only, foreshadowing further proceedings in the arbitration. If by that was meant that the appellants had the advantage of a continuing submission to arbitration which had not been concluded, the appellants might have sought a stay of the court action while the arbitration proceeded; but that was not the step taken by them. Instead, they participated fully in the County Court proceeding, arguing that an award had been made, that it was final and stood in the way of the respondent's recovering in the court action. When that point failed, the appellants took full part in the County Court action, arguing that, quite independently of the arbitration, nothing was owing. When that point failed too, they appealed to this Court seeking to re-agitate not the second point, but the first.

On the first point, whether there was an award precluding the respondent's succeeding in the court action, I think it is plain that there was not. The so-called award spoke of the appellants owing the amount claimed by the school and of their present inability to pay - that is, at 6 March 1995. It said nothing for the future save that there would be further review of their ability to pay. Even if the "award" should be taken to mean that the amount was owing but that the appellants were under no present liability to make payment (and I am not clear that it went so far), none the less the "award", such as it was, purported only to declare a state of affairs existing at 6 March 1995. The County Court proceeding was instituted on 20 March 1996 and it is plain enough that the "award", in speaking about ability to pay on 6 March 1995 - more than a year earlier - said nothing about the appellants' position on 20 March 1996 and thereafter. Thus, even if constituting a final award to the extent claimed, the award did not stand in the way of the respondent's success in the action and the only ground pursued in substance on this appeal fails.

It is for those reasons that I agree that the appeal should be dismissed.

Arbitration Act 1984

At a glance

Court

Decision date

Before

Source

Judgment (80 paragraphs)

Parties

Legislation Cited (2)