Mond & Mond v Berger [2004] VSC 45

2. In this proceeding the plaintiffs seek, inter alia, to set aside an award ("The Partial Award") dated 2 November 2001 made under the Commercial Arbitration Act 1984 (Vic) ("the Act") on grounds of misconduct including bias or apprehended bias of the arbitrators, the failure of the award to determine issues referred for decision in the arbitration agreement and its determination of issues which were not referred. By amended originating motion filed 1 May 2002, the plaintiffs seek orders pursuant to ss.36, 42, 43 and 44 of the Act that:

(a) the partial award made by the first to third defendants ("the arbitrators") on 2 November 2001 be set aside on the basis of misconduct within terms of s.42 of the Act;

(b) the arbitrators be removed by reason of misconduct pursuant to s.44 of the Act;

(c) the arbitrators receive no fees in respect of the arbitration and/or the defendants pay the plaintiffs' costs of the arbitration and the proceeding pursuant to s.36 of the Act;

(d) alternatively, the issues referred to the arbitrators be remitted to them for reconsideration pursuant to s.43 of the Act.

8. In addition to the matter of a corporate register of members, the Partial Award deals with religious subject-matter which is in no sense commercial in nature. It was not, however, contended by any party that the Partial Award was not an award within terms of the Act.

12. The plaintiffs, David Mond and Barry Mond, are longstanding members of the corporate fourth defendant, Caulfield Hebrew Congregation Inc. ("CHC").

15. The first to third defendants, Dayan Rabbi Isaac Dov Berger, Dayan Rabbi Yehuda Katz and Dayan Rabbi Yoram Ulman are "dayanim" or judges under Jewish Law ("Halacha") who were appointed arbitrators under an arbitration agreement executed on 1 August 2001 ("the arbitration agreement") by David Mond and Barry Mond on the one part, and CHC and 20 named persons belonging to CHC's board and executive on the other part, to decide "all claims and counterclaims existing between either of the Messrs Mond and the other named parties... acting as arbitrators according to Halacha and the rules of procedure established for and customarily employed in references to arbitration before a Beth Din, a Jewish Court of Law." Pursuant to the arbitration agreement the arbitrators' decision would be "final and binding on all parties and enforceable under the Commercial Arbitration Act of Victoria."

18. The fourth defendant, CHC, is an incorporated association. It was incorporated on 8 July 1988 pursuant to the Associations Incorporation Act 1981 (Vic). Among other functions, it administers a property in Caulfield, Victoria which contains three synagogues and other buildings.

21. The fifth to twenty-fourth defendants are members of CHC's Board or Executive.

26. David Mond is an Orthodox member of the Jewish faith. Although certain questions of eligibility for membership of CHC remain to be determined, it is not disputed that he is and has been a member of CHC, and a worshipper at CHC's synagogue complex, for some years. David Mond also belongs to Or Chadash, a minyan (or prayer group) which uses and occupies one of three synagogues within the complex of buildings administered by CHC. David Mond is an honorary warden or "gabbai" of the Or Chadash prayer group. His duties in that capacity involve the supervision of the conduct of the religious services on certain holy days in the Or Chadash Synagogue. David Mond's wife, four children, his brother Barry Mond (the second plaintiff) and other Mond family members also worship at the CHC Synagogue. Barry Mond is also a gabbai of the Or Chadash minyan.

29. Or Chadash is not incorporated. It is a minority group of worshippers within the broader CHC community of worshippers. There is no evidence before the Court identifying comprehensively those CHC worshippers who currently belong to Or Chadash or who belonged to, or were affiliated with, Or Chadash at any particular date. The persons associated with Or Chadash are all members of CHC. It appears that some persons who worship at CHC attend both the Or Chadash synagogue and the main synagogue to variable extents. The spiritual leader of Or Chadash is Rabbi Krasnjanski, who is a part-time employee of CHC. Rabbi Jonathan Abraham, until his resignation in about October 2001, was the principal full-time rabbi of CHC.

32. The relationship between the Or Chadash group of worshippers and the main congregation of the CHC Synagogue has been a source of tension for some years. There has been conflict over the status of the Or Chadash group and the main congregation and the relative authority of Rabbi Krasnjanski and Rabbi Abraham.

35. According to David Mond's evidence before the rabbinical arbitral tribunal ("Din Torah"), Or Chadash was originally formed as a youth prayer group during the 1980s and developed over time. Or Chadash was a separate synagogue in relation to worship and the authority of its rabbi, but it did not have any financial or administrative autonomy. David Mond believed that the Board of CHC had formed the view that Or Chadash should not exist and that its worshippers should pray in the main synagogue. Further, David Mond asserted that Rabbi Krasnjanski was ignored or slighted by the Board.

38. The annual general meeting of CHC for 2000 was scheduled for 20 September 2000. As the annual general meeting approached, David Mond and nine other persons affiliated with Or Chadash, who believed themselves to be members of CHC, planned to nominate for the Board of Management of CHC.

41. On 4 September 2000 David Mond visited the CHC premises and requested the CHC staff to provide 200 proxy forms for the election. On 5 September 2000 he was informed that pursuant to the resolution of the Board, only one proxy form would be provided to him.

44. On 7 September 2000 the CHC newsletter gave notice that the annual general meeting would be held on 20 September 2000. That was the only notice of the meeting.

47. On 8 September 2000 David Mond received by post a single proxy form which incorrectly stated that the annual CHC general meeting would be held on 19 September 2000. On 8 September 2000 David Mond also requested nomination forms and a copy of the CHC constitution from the CHC staff.

50. On 10 September 2000 David Mond again attended the CHC offices. He requested a copy of the CHC constitution and was initially informed that pursuant to a Board directive, he could inspect a copy, but a copy would not be provided to him. After the President of CHC intervened, the requested copy was provided to David Mond.

53. On or about 11 September 2000 Mr Nathan Frydman, who was associated with Or Chadash and intended to stand for election, was informed by CHC staff that he was ineligible for election, as he was not a member of CHC. Mr Frydman regularly occupied a seat in CHC for which his son paid rental on his behalf. He had assumed that all seatholders at CHC were members of CHC.

56. Mr Frydman informed David Mond that his status as a member of CHC had been denied. David Mond on 11 September 2000 wrote to the secretary of CHC expressing concern about eligibility for membership.

59. On 13 September 2000 David Mond visited CHC's offices. He asked to inspect the CHC register of members. David Mond was not shown a register of members. According to David Mond, he was told that there was no register of members "as such".

62. It would appear that there was no clear indication of whether membership of CHC was based on the payment of rental for seats within the CHC synagogues or on occupation of a rented seat or on some other ground. If eligibility depended upon the payment of seat rental, many occupants of seats, who had assumed that they were members, would be disenfranchised.

65. Jewish law imposes a general prohibition on the issuing of proceedings by one Jew against another Jew in a secular court. A dispensation ("hetter") from the observation of that general prohibition may, in certain circumstances, be obtained from a rabbi. Further, the prohibition may not apply to certain types of applications, such as applications for interlocutory relief.

68. On 13 September 2000 David Mond issued an ex parte application pursuant to s.14A of the Associations Incorporation Act 1991 (Vic) against CHC as defendant in the Magistrates' Court, seeking to prevent the holding of the forthcoming CHC annual general meeting, and to cause the names of all seat holders to be entered on the register of members. David Mond was of the view that according to Halacha, it was not necessary to obtain a hetter prior to seeking an interlocutory injunction, as it is not a final determination of rights, but simply maintains a holding position. Nevertheless, prior to the hearing of the application, he discussed the matter with Rabbi Krasnjanski, the rabbi of the Or Chadash Minyan, who gave him an oral hetter to proceed with the application to a secular court.

71. On 15 September 2000 Rabbi Krasnjanski confirmed his oral hetter in a letter to David Mond.

74. Prior to the hearing, there were attempts to resolve the subject matter of the Magistrates' Court application. They were unsuccessful.

77. On 18 September 2000, Magistrate O'Dwyer ordered that "Until the hearing and determination of this proceeding or further order of the Court, the Annual General Meeting of the defendant which had been convened to be held on 20 September 2000 is postponed until the question of eligibility for membership of the defendant has been determined by Rabbinical Arbitration or otherwise."

80. As a result of David Mond's application to the secular court, the Board and Executive of CHC, apparently advised by Rabbi Abraham, sought to terminate certain of his prayer rights and religious honours. There were indications of a proposal to expel or suspend David Mond's membership of CHC. Rabbi Abraham, the Board and Executive did not know, at that stage, that David Mond had obtained an oral hetter.

83. David Mond received hate mail and was concerned at comments allegedly made about him by CHC representatives.

86. David Mond, on 29 September 2002, obtained further interlocutory relief in the Melbourne Magistrates' Court restraining CHC from terminating his membership of CHC and his prayer rights and honours. The Court ordered that:

"1. Until the conclusion of the Rabbinical Arbitration referred to in the Order of 18 September 2000 or until further order, the Defendant and its servants and its agents including and without limiting the generality of the foregoing the President of the Board of Management of the Defendant and all of the Members thereof and Rabbi Yonason Abraham and Rabbi Mottel Krasnjanski and all other Officials and Officers of the Defendant (herein after referred to as `the Defendant') be restrained from proceeding with or commencing any step to suspend or expel from membership of the Caulfield Hebrew Congregation Inc. the Plaintiff.

2. That until the conclusion of the Rabbinical Arbitration referred to in the Order of 18 September 2000 or until further order, the Defendant be restrained from taking or proceeding with any step the effect of which would be to preclude or inhibit the full and free exercise and performance by the Plaintiff of any religious entitlements or functions which he was entitled to exercise or perform prior to 18 September 2000.

3. That the Defendant be directed to revoke forthwith the direction to its employee Rabbi Krasnjanski, the Minister of the Or Hadash synagogue, in relation to that synagogue to the effect that the Plaintiff was not to be permitted to perform any public religious functions (including Blowing of the Rams Horn on the Jewish New Year or Leading the Prayers over the Jewish High Holy Days) and was not to be accorded any religious honours (Kibbudim) and the Defendant be directed not to make any further direction or take any other step to that or like effect in relation to the synagogues conducted by it until the conclusion of the Rabbinical Arbitration referred to in the Orders made on 18 September 2000 or until further Order".

92. After 29 September 2000 and during 2001, negotiations to resolve the disputes between David Mond and CHC continued. David Mond's brother, Barry Mond, also became a party to the dispute in relation to a claim that CHC had wrongly issued invoices to him.

95. Throughout this time, CHC was unable to hold its annual general meeting due to the Magistrates' Court injunction.

98. The parties ultimately decided to proceed to refer their disputes to a rabbinical arbitration (Din Torah) conducted by three dayanim, or judges of Jewish Law. The Din Torah took the form of a tribunal of three dayanim, known as a zabla. A zabla requires each party to appoint one dayan (or judge), who is known as a borer and the two borerim together select a third judge (the "shalish"). The arbitration agreement does not refer to a zabla. The Partial Award states that the reference to the arbitrators is "a conventional reference to three arbitators". However, the evidence indicates that each group of disputants appointed a borer and the two borerim jointly selected a third judge.

101. David and Barry Mond appointed Rabbi Ulman of Sydney as their borer. CHC and its representatives appointed Rabbi Berger of Manchester as their borer. Rabbi Berger and Rabbi Ulman selected Rabbi Katz of Melbourne as the third dayan.

104. The Messrs Mond had a number of complaints and claims which they wished the arbitrators to determine. CHC and the persons who (subject to any challenges due to non-compliance with the Associations Incorporation Act) comprised the Board and Executive of CHC, also had claims against the Messrs Mond which they wished the arbitrators to determine. A number of drafts of arbitration agreements were exchanged by the legal representatives of the parties.

107. CHC sought to refer for determination certain claims, including whether David Mond was, in all the circumstances, entitled according to Jewish Law to issue the application to the secular court and whether the behaviour of David Mond towards certain employees and members of CHC was, in all the circumstances, proper. It also sought to have determined its rights to declaratory relief against the Or Chadash Minyan and Rabbi Krasnjanski.

110. The Messrs Mond did not agree that the Or Chadash issue was a dispute between the parties which should be referred for determination by the Beth Din. CHC insisted that the issue should be referred for determination. Due to the parties' inability to agree on the specific issues for decision, the arbitration agreement ultimately executed by them expressed the subject matter of the reference in very general terms, discussed in detail below.

114. The arbitration agreement dated 1 August 2001, executed by Messrs David and Barry Mond on the one part, and CHC and certain members of the CHC Board of Management and Executive on the other part, is set out in full:

"ARBITRATION AGREEMENT WE the undersigned; David Mond and Mr Barry Mond of 91 Orrong Crescent, Caulfield North, 3161 of the first part and; The Caulfield Hebrew Congregation Inc; The representatives of the Caulfield Hebrew Congregation The President, Mr Schneier; Mr A Moss, Treasurer; The Secretary, Mr Fleischmann; The Vice Presidents, Mr L. Gescheit and Mr A. Weimann; The Chairman, Mr D. Landau; The immediate past President, Mr Heimann; Rabbi Y Abraham; Rabbi S Gutnick; Rabbi Y Gutnick; All members of the Board of Management of the Caulfield Hebrew Congregation, Inc. at the relevant times (with the exception of Messrs, Weil, Rothschild and Frenkel.) and Mr S. Apfelbaum of the other part; hereby agree to refer all the claims or counterclaims existing between either of Messrs Mond and the other named parties (the relevancy of which for this arbitration will be determined by the arbitrators)-: ALL for decision by Rabbi Y Ulman of 25 O'Brien Street, Bondi NSW 2026 and Dayan Isaac Dov Berger of 17 Craven Walk, London N166BS ("the arbitrators") acting as arbitrators according to Jewish law and rules of procedure established for and customarily employed in references to arbitration before a Beth Din, a Jewish Court of Law; and we confirm and agree that the said arbitrators have appointed to join them Rabbi Katz of Congregation Adass Israel Congregation, Melbourne as the third arbitrator. WE SUBMIT to the exclusive jurisdiction of the said arbitrators and accept that their decision shall be final and binding on all parties and enforceable under the relevant Commercial Arbitration Act of Victoria. We further expressly AGREE that the said arbitrators are hereby empowered to make both inter partes and ex parte orders as well as orders as to costs. WE the undersigned do AGREE to accept and perform the award of the said arbitrators concerning the said claims and counterclaims and other orders. [Dated: 01/08/01]"

119. The arbitration took place at the CHC Synagogue in Caulfield between 24 October 2001 to 2 November 2001. The proceedings were held in public and were conducted in English. However, some comments were spoken in Yiddish or Hebrew. The Messrs Mond were represented by Mr Heath of counsel. The fourth to twenty-fourth defendants were represented by Mr Havin of counsel.

122. At the commencement of the hearing on 24 October 2001 David Mond made an opening address in which he identified a considerable number of issues for determination. Those issues included the membership of CHC, alleged irregularities in CHC, the process of calling and administering a lawfully convened annual general meeting, the conduct of a number of CHC office bearers and rabbanim, the propriety of David Mond's conduct in obtaining the Magistrates' Court injunctions and various persons' responses to that conduct.

125. David Mond's opening address did not raise as an issue for determination the status of Or Chadash or its relationship to other worship groups within CHC. At trial he testified that Or Chadash was not an "issue that was raised by me and in fact at the outset of the proceeding my counsel and I repeatedly objected to Or Chadash being made a party to the arbitration".

128. David Mond further stated that when, at a meeting with the dayanim on 31 October 2001, the dayanim focussed on Or Chadash and its relocation, he "again reiterated that Or Chadash was not an issue to be dealt with and that I had no authority to decide on the future of Or Chadash."

131. At trial, Barry Mond testified that in response to Rabbi Berger's proposal for the relocation of Or Chadash at the meeting on 31 October 2001, David Mond responded that Or Chadash was not an issue for determination nor a party to the dispute. Mr Lewis Janover, solicitor for the plaintiffs, also gave evidence that at the meeting David Mond responded that Or Chadash was not a matter which was before the arbitrators and that he did not, in any event, speak for Or Chadash.

134. At the commencement of the hearing, Mr Heath, counsel for the Messrs Mond, handed up a typed list of issues in dispute. The list of issues referred to the failure of CHC to keep and maintain a list of members, the consequent invalidity of elections and office holders, the Messrs Monds' conduct, defamation and costs. The list did not refer to Or Chadash.

137. The defendants' counsel, Mr Havin, also made an opening address in which, inter alia, he submitted that there was no uncertainty about eligibility for membership of CHC, as all seatholders were members.

140. Mr Havin stated that "the Dayanim will be told much about the various constituent parts of the Congregation in general, and in particular, the question of the relationship between Or Chadash and the main Hebrew Congregation, CHC, as well as the relationship between Rabbi Abraham and Rabbi Krasnjanski".

143. Mr Havin further stated that a difference over two questions "had been a festering sore" - "first of all that the Rabbi of the Congregation, his ministerial fiat runs over the entirety of the premises; of all the Minyanim [prayer groups] here, and secondly, that although Or Chadash has a degree of autonomy, it is not an independent Congregation, but part of the CHC".

146. Mr Heath, counsel for the plaintiffs, responded that "Or Chadash is not a party to the dispute and is not a party to the arbitration agreement. ... it has no standing, it has no identity".

149. Mr Havin stated that "in the process of drawing up the Shtar Borerut, the Deed of Submission, the Congregation made it clear that it had, as well as defences and counterclaims to Mr Mond and to his brother, Mr Benzion Mond, ... third party claims against Or Chadash and Rabbi Krasnjanski. Those were declarations about their true relationships; what the proper nature is of the relationship between Rabbi Abraham personally and that office and Rabbi Krasnjanski and the Or Chadash and the Congregation".

152. Following the opening statements by David Mond and Mr Havin and the handing up of a list of issues by counsel for the plaintiffs, David Mond gave evidence. On Thursday, 25 October 2001, Friday, 26 October 2001 and Sunday, 28 October 2001, Rabbi Krasnjanski gave evidence. On Sunday, 28 October 2001 and Monday, 29 October 2001 Rabbi Abraham gave evidence. At the conclusion of the hearing on Monday, 29 October 2001 Mr Heath's cross-examination of Rabbi Abraham was not completed. The resumption of the cross-examination was scheduled for Tuesday, 30 October 2001.

156. On Tuesday, 30 October 2001 the hearing did not resume as scheduled. The Messrs Mond made an open offer to settle the dispute, on the basis that CHC pay them the sum of $85,000 in respect of costs and upon certain conditions, which included: agreement that the dayanim should make certain declarations and determinations, including that all parties acted with the intention of avoiding any resort to disputation; that Mr David Mond was a sincere person who acted with a hetter from the rev ("rabbi") and acted in accordance with Halacha; that in the context of the dispute, any statements made against Mr David Mond were incorrect; that Mr Mond undertook to help form a committee to establish a new permanent Beth Din of Victoria; that there were irregularities and difficulties in the maintenance of the register of CHC which should be addressed by the preparation of a new up-to-date register of members to include all relevant details of the persons who are, on the principles of fairness and equity and in the spirit of the CHC constitution, entitled to the rights and privileges and [of] members of CHC.

The register was to be prepared in accordance with the procedure determined by a suitable person on whom the parties agreed; an annual general meeting was to be held as soon as possible, pursuant to a procedure for the election of officers to be determined by the agreed person.

160. The Monds' open offer was made available to the dayanim at about 2.00 pm on Tuesday, 30 October 2001 and to the fourth to twenty-fourth defendants at about 3.15 pm on that day.

163. The arbitration hearing resumed at 8.15 pm on 30 October 2001. Mr Heath of counsel spoke to the plaintiff's settlement proposal. He stated that there was a deadline of 9.00 am on Wednesday, 31 October 2001 for the acceptance of the settlement proposal. Mr Mond then made a speech.

"Choshuveh Dayanim [Esteemed Judges] at the outset of this arbitration, I stated a number of objectives and sought various rulings. They included a number of rulings, for example, concerning the actions of Board members and other parties to the dispute. I feel it's important at any given moment of time to consider where one stands. We have spent a week in this Honourable court. We have been privileged to see the workings of a Din Torah and we hope that, God willing, there won't be disputes, but if there are, such a forum will be available in the future. The reasons why this offer has been put primarily is because, and there is correspondence relating to it over a period of time, I have always been concerned about two things. One, that I be given an opportunity to have my name cleared and two, that we obtain a lawful register of members so that people can exercise their democratic right to vote, however that may be ... Well right now, there's been a number of people that have called witnesses and I am personally satisfied that my name in my view has been cleared. Some may disagree, some may always hold a view to the contrary. That's their right, but I'm personally satisfied. I'm also satisfied that we have investigated the whole issue of register of members and there needs to be a major change to the way this place runs, and we've exposed very sad inefficiencies ... ... I thank the honourable Dayanim, the Choshuveh Dayanim for everything they've done and for giving us the opportunity to air our views and our grievances ..."

170. At the conclusion of his speech David Mond sought that the cross-examination of Rabbi Abraham be resumed. Rabbi Berger did not accede to the request as it was about the usual time to adjourn. He closed the hearing for the day.

174. A meeting of the Board of CHC was held at 8.00 am on the morning of Wednesday 31 October 2001 to consider the plaintiffs' settlement offer. The Board voted against the acceptance of the plaintiffs' offer and put a counter-offer.

177. Rabbi Abraham, whose cross-examination had not been concluded, briefly attended the 8.00 am Board meeting. Rabbi Abraham had resigned from CHC and had accepted a new position in London. He had made it known that he was scheduled to leave Australia at some time during the day. At the 8.00am meeting he took his leave of some of the Board members who were present.

180. The hearing resumed at 11.30 am. Rabbi Abraham did not appear in order to complete his cross-examination. There was a short adjournment to ascertain his whereabouts. Inquiries revealed that he had already left for the airport to take a flight to London. When the hearing resumed, Mr Heath of counsel expressed concern over the absence of Rabbi Abraham. The plaintiffs' claims in relation to Rabbi Abraham are dealt with in detail below.

183. As Rabbi Abraham was not available, other witnesses gave evidence on 31 October 2001. There was an adjournment for dinner between 5.30pm and 7.00pm. Rabbi Berger shared a meal with Rabbi Krasnjanski. He put to Rabbi Krasnjanski a proposal for settlement with Or Chadash which was similar or identical to that subsequently discussed with the Messrs Mond and ultimately included in the Partial Award. According to Rabbi Berger, Rabbi Krasnjanski was uncooperative. He did not support the proposal. Rabbi Berger testified that he told Rabbi Krasnjanski that if the proposed settlement were not accepted and the arbitration ran its course, there was a possibility of ruling in favour of David Mond's expulsion.

186. Mr Weil, who was associated with Or Chadash, gave evidence during the course of the evening hearing on 31 October 2001. Mr Weil's evidence was not completed when the evening hearing concluded at about 9.00 pm on 31 October 2001.

189. Almost immediately after the conclusion of the hearing that evening, a meeting took place in an upstairs room of the synagogue. The three dayanim, the Messrs Mond, their solicitor, Mr Janover and their counsel, Mr Heath, attended. There is a conflict of evidence on what happened, and what was said, at the meeting, which lasted between 15 to 20 minutes according to the Messrs Mond and lasted for about 30 minutes, according to Rabbi Ulman and Rabbi Berger. The meeting, which is the basis of several of the plaintiffs' claims of misconduct, is discussed in detail below.

192. Following their meeting with the dayanim at the synagogue, the Messrs Mond, Mr Janover, Mr Heath and Rabbi Ulman had a further meeting that evening in Rabbi Ulman's hotel room ("the hotel meeting").

195. David Mond's evidence, confirmed by Barry Mond and Mr Janover, was that in the course of the hotel meeting he stated that he would not proceed with the arbitration and dismissed Rabbi Ulman as his borer.

198. David Mond deposed that he informed Rabbi Ulman at that meeting, that he viewed Rabbi Katz and Rabbi Berger as "corrupt and false judges" and that he "would not deal with blackmailers". He testified that he reiterated his position on Or Chadash and told Rabbi Ulman to return to Sydney to his wife and family. David Mond asserted that Rabbi Ulman asked for more time to negotiate a settlement. He agreed to give Rabbi Ulman until 6.00 p.m. the following day to negotiate on his behalf.

201. In his evidence, Rabbi Ulman recollected that the general atmosphere of the hotel meeting was positive. He could not recall David Mond's alleged comments. Rabbi Ulman's evidence is discussed in more detail below. Due to his vagueness and poor recollection he was not an impressive witness. In the case of a conflict, I prefer the evidence of the Messrs Mond and Mr Janover.

204. On 1 November 2001, the Messrs Mond and their legal representatives did not appear at the arbitration. The hearing proceeded in their absence on 1 November 2001 and 2 November 2001.

207. On 1 November 2001, Mr Havin announced CHC's counter-offer, the terms of which included the relocation of Or Chadash with rental assistance, the resignation of Or Chadash's members and the resignation of Rabbi Krasnjanski as an employee of CHC.

210. Barry Mond testified that on 1 November 2001, Rabbi Ulman telephoned him, as David Mond was not taking calls. Barry Mond testified that he confirmed to Rabbi Ulman that David Mond would no longer be participating in the arbitration and had terminated Rabbi Ulman's appointment as his borer. He told Rabbi Ulman that there was a conspiracy against David Mond and that he should pack his bags and go back to his wife and family.

213. Rabbi Ulman testified that during the telephone conversation Barry Mond was very agitated. He could recall him saying that there was a conspiracy against David Mond, that Rabbi Berger was a "master planner" and that Rabbi Ulman had been "used" and should pack his bags. At trial, Rabbi Ulman could neither recall nor deny the evidence given by Barry Mond in relation to the details of the conversation.

216. Messrs Yosef Yitzchak Gutnick and Osher Levin gave evidence on the final day of the arbitration. The hearing concluded before midday on 2 November 2001. The concluding remarks, made by Rabbi Berger, were:

"We have got a lot more work. We still sat last night and debated the issues. We've got a lot of time to do, quite a lot of drafting still to do. It may well be that we will not, it's anyway going to be a partial award for a variety of reasons. The award once completed and signed is going to be lodged with Rabbi Katz as the Shalish [third Dayan] and it will be released as is normal pending the payment of the arbitration costs by all parties. ...".

220. The arbitrators completed and signed a Partial Award dated 2 November 2001.

223. David Mond did not pay Rabbi Ulman's fee or his share of Rabbi Katz's fees. CHC ultimately paid those fees.

226. Upon payment of the arbitrators' fees, on 16 November 2001, the arbitrators handed down a Partial Award dated 2 November 2001.

229. The plaintiffs commenced the proceeding by originating motion dated 21 December 2001. An amended originating motion was filed on 1 May 2002. By order of Balmford J. made 27 August 2002, the arbitrators were restrained from conducting any further hearing.

233. The Partial Award is set out in full. It states:

"PARTIAL AWARD In the case of Mond v Caulfield Hebrew Congregation We the undersigned have been appointed arbitrators, pursuant to an Arbitration Agreement duly executed, to adjudicate on all claims that the parties have against each other. The Agreement requires us to decide the matter according to Jewish law and rules of procedure established for and customarily employed in references to arbitration before a Beth Din, a Jewish Court of Law. For the avoidance of doubt, the reference to us the undersigned is a conventional reference to three arbitrators and not a reference to arbitrators/advocates pursuant to s.12 of the Domestic Arbitration Act or s.8 of the British Arbitration Act (1950). The aforementioned rules of procedure are intended to ensure that:

II. Each party is given full opportunity to be present at the hearing together with his advisers and witnesses so as to present his case by addressing argument and presenting witnesses and evidence in support of his own case.

III. Each party is given the opportunity to hear his opponent's case and is given the opportunity to test and rebut it by cross-examining his witnesses, presenting rebutting evidence and addressing oral argument.

IV. Unless otherwise agreed, the hearing is the only occasion on which the parties present the whole of their argument and evidence.

It ought to be pointed out that, unusually; the hearings were open to the public. The Plaintiff and his legal team withdrew from the proceeding at the conclusion of the hearing on 31st October. They had been notified of the hearing on the evening of 1st November and were given reasonable opportunity to attend but failed to do so. Hearings took place on 24, 25, 26, 28, 29, 31 October, 1 and 2 November. We heard the testimony of Rabbis Krasnjansky and Abraham and Messrs D. Mond, R. Weil, G. Heimann, S. Schneier Y Gutnick and O Levine. We, by majority, find as follows Précis of The Facts

1. CHC (herein under the Defendant) was founded in the early forties. It had two previous Constitutions; it is now governed by the 1988 Constitution that had been adopted following incorporation pursuant to the Association Incorporation Act (1981).

2. Its purpose is inter alia to provide facilities for Orthodox Jewish religious worship and to arrange and conduct religious services, to aid and support the elderly the sick and the needy, and the preservation of the identity of the Jewish people through the fostering of Jewish education.

3. Its Rabbi at all relevant times had been Rabbi Y Abraham. He, in fact, relinquished his position in the course of the arbitration to take up an office as Dayan at the London Beth Din.

4. There exists a small synagogue within the Defendant's complex that is home to a Minyan (prayer group) that meets on Shabbath mornings and on festivals and is known as Or Chadash. The Minyan is the progeny of an earlier youth service and functions now as an alternative Minyan. Members may elect to have seats allocated to them in either of the synagogues. Its Rabbi is Rabbi M. Krasnjansky who was appointed in 1984. The status of Or Chadash and its Rabbi relative to the main congregation, although not formally part of the Plaintiff's case, is, in our judgement, intrinsically linked to it.

5. Mr D. Mond The Plaintiff joined the congregation in 1990 and has chosen to attend the Or Chadash services where his elder brother is Gabbay (warden).

6. On 4th September 2000 the Plaintiff telephoned Mr Gutnick, an elected member of the Board as well as salaried Manager of the Congregation asking for 200 proxy forms for the forthcoming Annual General Meeting. On the following day Mr Gutnick responded that the Board had determined the previous evening that only one proxy form would be issued per member. (It is now common ground that the Constitution does not require the proxy form to have emanated from the Congregation.) One proxy form subsequently arrived in the post on 8th September but had been made up for a meeting on the 19th September rather than the 20th.

7. On 7th September the Plaintiff received notice by way of a small advertisement in the Congregation's newsletter that the Annual General Meeting was to be held on 20th September.

8. On 8th September Mr Mond attended the Congregation's office seeking nomination forms. The matter was of some urgency as the Constitution required nominations to be lodged 7 days prior to the Annual General Meeting. Mr Mond subsequently received the nomination forms Mond [sic] on 10th September when he attended the Congregation's office. At that visit to the Congregation's office Mr Mond also asked for a copy of the Congregation's Constitution. He was told by the secretariat that by order of the Board the Constitution was not [sic] be handed out, he was however free to examine the Constitution at the office. Subsequently the president and another Board member denied the existence of such Board order and the Constitution had subsequently been provided.

9. On 11th September a Mr Nathan Frydman, a prospective contender for the office had been informed that he was ineligible to stand for election, as he was not considered a member of the Congregation. He had been told that since his son paid for his seat, only his son was recorded as a member. Such a scheme, if applied, would disenfranchise result [sic] in a considerable body of the congregation.

10. On 13th September Mr Mond attempted to inspect the Register of Members and was allegedly told that there was no such register. In any event the Register had not been produced for inspection.

11. On that day Mr Mond applied to [sic] Magistrates' Court to restrain the Defendant from holding the AGM convened to be held on the 20th September and to cause to enter into the Register of Members the names of each person to whom a seat has been allotted. The aforementioned Court ordered the Defendant on 18th September that the AGM be postponed until the question of the eligibility for membership of the Defendant has been determined by Rabbinical Arbitration or otherwise.

12. Subsequently the Board, after consulting Rabbi Abraham, had decreed that the Plaintiff not be permitted to blow the Shofar or to lead the prayers. Additionally he was not to be accorded any Kibbudim at the OC Minyan. The decision was communicated to Rabbi Krasnjansky. At the same time the Plaintiff was concerned about moves to expel him from the Congregation. Accordingly he applied to the said Court on 20th September for an order restraining the Defendant, until the conclusion of the Rabbinical Arbitration, from, inter alia, proceeding along the lines set out above. The Application was granted on 29th September.

13. Throughout the period numerous attempts had been made to mediate the dispute and/or bring about a binding reference to Rabbinical Arbitration, the failure of which is ascribed by each party to actions or lack of action of the other. We shall refer to the relevant events below.

As a consequence of the above the Plaintiff seeks:

i. Damages from the individual respondents for defamation.

ii. Order requiring the resignation of the individual respondents.

iii. Order for costs of and incidental to these proceedings.

It is not our function to decide which one of the respective Rabbinic rulings is accurate and scholarly divergence is quite common. For that reason, we assume, for the purpose of this award, that both Rabbanim were perfectly entitled to arrive at their respective conclusions.

Having carefully considered all the relevant matters and in particular the admission that Mr Mond has neither sought nor received any Rabbinic guidance before commencing Court proceedings we conclude that Mr Mond has, separately from the propriety of the application to Court to intervene, conducted himself over a course of a considerable period in a manner that was overtly confrontational and that the community could not reasonably be expected to tolerate his conduct. As for the application to Court to restraining [sic] the Synagogue, that was an appalling step, causing as it did a Chilul Hashem, and is contrary to every Jew's instinct. Furthermore; as noted above, at the time he had not yet received Rabbi Krasnjansky's Hetter. We therefore order that Mr Mond apologises to CHC in writing for having [sic] the anguish and pain that he has caused them. We further rule that should Mr Mond persist henceforth in the abovementioned manner, the Board would be entitled to proceed to terminate his membership in the Congregation under the powers conferred to it in the Constitution.

Rabbi Abraham testified before us Monday 29th October. The hearing terminated before Mr Mond's counsel had concluded the cross-examination and had consequently indicated that he required Rabbi Abraham for a short time [sic] next day. The following day was largely devoted to an attempt to settle the dispute. Rabbi Abraham attended and was told that he was not required then and would be informed when he would be require [sic]. Mr Mond's counsel called for him on Wednesday 31 October at 11:30 AM. Rabbi Abraham was scheduled to depart to England on that day. Indeed he had previously agreed at the request of the Beth Din to delay his departure by two days. Furthermore Mr Mond's counsel was urged to allow Rabbi Abraham to testify earlier in the proceedings. That offer was rejected on the basis that the change would seriously impede their presentation of the case. In the circumstances the Dayanim, by a majority, ruled, having [sic] into account all circumstances, that it would be unjust to delay his departure. The Beth Din had offered, if required, to arrange for him to testify in England as provided for in Halacha and law. Nonetheless we feel confident to proceed to issue this partial award. As for the sanctions imposed on Mr Mond, it has now been established that shortly after the commencement of the Court proceedings and before the matter came up for a hearing he had had Rabbi Krasnjansky's Hetter. Rabbi Abraham admitted that, had he known about this, he would have reconsidered the matter and would have sought Halachic guidance. In the circumstances therefore Rabbi Abraham ought to apologise to Mr Mond for the hurt caused to him as a result of the aforementioned ban.

We find that the Board's resolutions passed at the special meeting held on 13th December 1982 are lawful, valid and binding. The two that are germane to this dispute are the claimed autonomy of the Minyan and Rabbi Krasnjansky [sic] extent of authority. Resolution 2 expressly denies such autonomy and resolution 6 limits the authority of the Miyan's [sic] Rabbi. Accordingly, Rabbi Krasnjansky, having been appointed subsequent to the passing of those resolutions, is subject to rule 6 thereof, namely, that on matters of interpretation of Jewish law to be observed within all premises, only the Rabbi of the CHC may give rulings. This of course does not private[sic] Shaalot or Halachic issues that, in the view of the Rabbi of CHC, are limited to Or Chadash. It going [sic] without saying, that the [sic] it is incumbent upon the Gabboim of Or Chadash to endeavour to collect all donations and to pass them on to CHC. Should the Board at any time in the future wish to use the Minyan's location for other purposes they may do so on either terms agreed with Rabbi Krasnjansky and the Mispalelim or in accordance with the ruling of this Beth Din. Regrettably, it appears that the relationship between Or Chadash significantly deteriorated and that it would be in the interest of both parties to amicably agree on terms of relocation. If the Rabbi and members of Or Chadash wish to leave and establish a separate congregation, it would be fair for CHC to pay a sum of AUS $150,000 over the period of 4 years and allow then reasonable time (at least 6 months) to find a suitable venue.

The Dayanim find that the current system of recording members is flawed and does not comply with the provision of constitution [sic]. At the same time there is no evidence of real prejudice. We record the agreement of CHC to appoint Mr A. Paluch of Guests Accounting, certified practising accountants of 234 Balaclava Rd Caulfield North to supervise the compilation of a new Register of Members in compliance with the Constitution and the Act and to supervise the preparation and conduct of the next AGM. He should look to the Daynim [sic] to enforce his decision if necessary. As for the issue of the antenna, since it is a matter somewhat extraordinary, the whole Board (not merely the Executive) should decide on the matter.

Under Halacha, with a few exceptions each party pays its own costs. In our judgement this should be followed in this case. Accordingly, both parties are hereby restrained from enforcing any cost order made in court. This Award does not address all issues between the parties, hence its heading Partial Award. The issues left over are:

3. Any issues connected with or arising out of this Award and particularly the abovementioned proposal for settlement with Or Chadash.

280. The Messrs Mond seek to have the Partial Award set aside or remitted on the grounds of misconduct within terms of s.42 of the Act.

283. It is well established that the court's legitimate role in reviewing awards is circumscribed. The possibility of curial review on the ground of misconduct should not operate to permit the use of an arbitration as a mere "dry-run" prior to litigation[1]. On the other hand, the agreement of the parties, which justifies the narrow role of the court in relation to review, cannot be taken as consent to be bound by "an award made by an arbitrator who has exceeded his or her powers or has otherwise acted unlawfully, or has failed to accord natural justice to the parties"[2].

286. "Misconduct" in the context of arbitration legislation is a potentially misleading term which comprehends a broad diversity of conduct both in relation to the arbitral hearing and the making of the award.

"`Misconduct' includes corruption, fraud, partiality, bias and a breach of the rules of natural justice."

293. In addition to conduct which involves moral turpitude, "misconduct" comprehends irregularities in the conduct of the proceeding (as s. 42 (1)(a) expressly recognises) and extends to breaches of duty associated with the making of the award. If the arbitrator fails to decide the issues referred for decision, or decides issues not referred for decision, it will amount to misconduct[3]. Section 42 (2) recognises that the making of an award in respect of matters not referred for decision constitutes "misconduct of the proceeding". If the arbitrator delegates his or her decision making power, it will constitute misconduct.

296. The Act confers upon the court a discretion to set aside the award in whole or in part where misconduct is established.

"Power to set aside award (1) Where - (a) there has been misconduct on the part of an arbitrator or umpire or an arbitrator or umpire has misconducted the proceedings; or (b) the arbitration or award has been improperly procured - the Court may, on the application of a party to the arbitration agreement, set the award aside either wholly or in part. (2) Where the arbitrator or umpire has misconducted the proceedings by making an award partly in respect of a matter not referred to arbitration pursuant to the arbitration agreement, the Court may set aside that part of the award if it can do so without materially affecting the remaining part of the award. (3) Where an application is made under this section to set aside an award, the Court may order that any money made payable by the award shall be paid into Court or otherwise secured pending the determination of the application".

"Court may remit matter for reconsideration Subject to section 38(1), the Court may remit any matter referred to arbitration by an arbitration agreement together with any directions it thinks proper to the arbitrator or umpire for reconsideration or, where a new arbitrator or umpire has been appointed, to that arbitrator or umpire for consideration".

"Removal of arbitrator or umpire Where the Court is satisfied that - (a) there has been misconduct on the part of an arbitrator or umpire or an arbitrator or umpire has misconducted the proceedings; (b) undue influence has been exercised in relation to an arbitrator or umpire; or (c) an arbitrator or umpire is incompetent or unsuitable to deal with the particular dispute - the Court may, on the application of a party to the arbitration agreement, remove the arbitrator or umpire".

"Subject to this Act and to the arbitration agreement, the arbitrator or umpire may conduct proceedings under that agreement in such manner as the arbitrator or umpire thinks fit."

315. In London Export Corporations Ltd v Jubilee Coffee Roasting Co Ltd,[4] Diplock J. observed:

"The use of the expression `misconduct' with its suggestion of moral values, includes the kind of alleged irregularity in procedure with which the case is concerned tends to misunderstanding . . . The first task of the court is to construe the arbitration agreement - that is to ascertain to what procedure the parties have agreed - . . . Where the award has been made by the arbitrator in breach of the agreed procedure, the applicant is entitled to have it set aside, not because there has been necessarily any breach of the rules of natural justice, but simply because the parties have not agreed to be bound by an award made by the procedure in fact adopted . . . When the arbitration agreement has been construed and no breach of the agreed procedure found there may nevertheless arise a second and quite separate question, that is, whether, as a matter of public policy, a particular award, made pursuant to that agreed procedure, ought not to be enforced and ought, therefore, to be set aside; for an arbitrator's award, unless set aside, entitles the beneficiary to call upon the executive power of the State to enforce it and it is the function of the court to see that the executive power is not abused. It is in relation to this second and separate question that the rules of what is so often called natural justice may arise directly. There may be a variety of grounds of public policy on which an award may be set aside. That it has sought to oust the statutory jurisdiction of the court to direct a special case to be stated is one example . . . That its effect is to enforce an illegal contract is perhaps another, . . . and I apprehend that an award obtained in violation of the rules of natural justice even where there was no breach of the agreed procedure would be set aside on grounds of public policy: as, for instance, where an arbitrator manifested obvious bias too late for an application for his removal to be effective before he made his award ..." [5]

319. In Williams v Wallis and Cox[6] Lush J. observed:

"Misconduct is not necessarily personal misconduct. If an arbitrator for some reason which he thinks good declines to adjudicate upon the real issue before him, or rejects evidence which, if he had rightly appreciated it, would have been seen by him to be vital, that is within the meaning of the expression `misconduct' in the hearing of the matter which he has to decide, and misconduct which entitled the person against whom the award is made to have it set aside."[7]

323. Atkin J., in a well known observation, remarked that the expression "misconduct":

"Does not necessarily involve personal turpitude on the part of the arbitrator . . . The term does not really amount to much more than such a mishandling of the arbitration as is likely to amount to some substantial miscarriage of justice . . . "[8]

327. Bias is expressly recognised in s.4(1) of the Act as a species of misconduct.

330. In Webb v The Queen,[9] Mason C.J. and McHugh J. stated:[10]

"When it is alleged that a judge has been or might be actuated by bias, this Court has held that the proper test is whether fair-minded people might reasonably apprehend or suspect that the judge has prejudged or might prejudge the case. ... The Court has specifically rejected the real likelihood of bias test. The principle behind the reasonable apprehension or suspicion test is that it is of `fundamental importance that justice should not only be done, but should manifestly and undoubtedly be seen to be done'."[11]

334. In Livesey v New South Wales Bar Association,[12] the High Court stated:

"It was common ground between the parties to the present appeal that the principle to be applied in a case such as the present is that laid down in the majority judgment in Reg. v Watson; Ex parte Armstrong [(1976) [1976] HCA 39; 136 C.L.R. 248 at pp.258-263]. That principle is that a judge should not sit to hear a case if in all the circumstances the parties or the public might entertain a reasonable apprehension that he might not bring an impartial and unprejudiced mind to the resolution of the question involved in it.[13]"

338. In Grassby v The Queen[14], Dawson J. observed that the test is:

" ... whether in all the circumstances the parties or the public might entertain a reasonable apprehension that the judge might not bring an impartial and unprejudiced mind to the resolution of the matter before him. See Livesey v New South Wales Bar Association [1983] HCA 17; (1983) 151 C.L.R. 288; Reg v Watson; Ex parte Armstrong [1976] HCA 39; (1976) 136 C.L.R. 248."

342. As recognised by Toohey J. in Webb v The Queen[15], "the underlying principle is the same, whether judges, jurors or members of a tribunal are concerned, though naturally its application will differ in those cases."[16]

345. In Gascor v Ellicott[17] the Court of Appeal upheld the trial judge's rejection of an application to remove an arbitrator for misconduct pursuant to s. 44 of the Act.

348. The appellant sought to remove the arbitrator appointed to determine a payment due by the appellant to the respondent under an agreement for the purchase of natural gas. The appellant alleged that the arbitrator had previously acted as counsel for the producers of the gas product in an earlier arbitration involving some similar issues and had cross-examined expert witnesses whom the appellant intended to call; had acted as an arbitrator in another arbitration and had rejected evidence of persons to be called as expert witnesses for the appellant; and had not disclosed those matters. It alleged that the arbitrator's conduct gave rise to a reasonable apprehension of bias.

"There is no suggestion in this case of actual bias. The question of apprehended bias as a disqualification from adjudication in a court of law was most recently considered by this court in Rozenes v Kelly [1996] VicRp 20; [1996] 1 V.R. 320. As it was there stated at 329 the essential issue in such a case is whether in all the circumstances, a fair-minded lay observer with knowledge of the material objective facts might entertain a reasonable apprehension that the judge might not bring an impartial and unprejudiced mind to the resolution of the matters before him."[18]

"Although the criterion of apprehension of partiality or prejudice is [sic] possibility, not likelihood, a reasonable apprehension is to be established to the court's satisfaction: it is a reasonable and not a fanciful or fantastic apprehension that is to be established; and the apprehension is to be attributed to an observer who is `fair-minded' - which means `reasonable.'. . . ... Moreover, it is for the court to determine what knowledge the fair-minded or reasonable lay observer is to apply to an appraisal of the situation."[19]

359. He referred to Laws v Australian Broadcasting Tribunal[20] where Mason C.J. and Brennan J. said:

"In assessing what the hypothetical reaction of a fair-minded observer would be, we must attribute to him or her knowledge of the actual circumstances of the case[21]."

Tadgell J.A. also referred to Webb v The Queen[22] where Deane J. considered that the hypothetical figure should have :

"A broad knowledge of the material objective facts as ascertained by the appellate court[23]."

"However one describes the knowledge, the observer whose view the court is to seek is in my opinion to be fastened with sufficient knowledge to enable a rational and reasonable view - not just a perfunctory or superficial view - to be formed. Of course that is really to say no more than that there must be attributed to the fair-minded observer knowledge which would afford an opportunity to consider all the relevant circumstances of the case . . . "[24]

369. In Gas & Fuel Corporation of Victoria v Wood Hall Ltd & Leonard Pipeline Contractors Ltd[25] Marks J. affirmed that the fundamental requirements of natural justice must be fulfilled in a valid arbitration. He stated:

"Thus it can be seen that from early reported cases the courts have insisted that principles, if not of natural justice, then those akin thereto, were to be observed by arbitrators simpliciter. In In re Badger (1819), 2 B. & Ald. 689; 106 E.R. 517 Abbott, C.J. said: `If an arbitrator acts contrary to a general rule of law it is undoubtedly the duty of the court to set aside his determination. But there is a material distinction between those rules which are founded on the immutable principles of justice, from which neither the court nor an arbitrator can be allowed to depart, and those which depend on the practice of the court ... ` See also Re an arbitration between Camillo Eitzen & Jewson & Sons (1896), 40 Sol. Jo. 438 in which the court comprising Pollock, B. and Bruce, J. said: `Whether the arbitration was conducted on the footing that it was a mercantile or a legal arbitration, the first principles of justice must be equally applied in every case. Whatever, therefore, were the terms agreed to the arbitrator had acted wrongly, and the award must be set aside[26].' Marks J. further stated that: "...[S]ubject to the overriding principles of natural justice, arbitrators clearly have a discretion as to the way in which they conduct arbitrations ... The proceeding before the arbitrator is still nonetheless judicial; ... The proceeding being judicial or quasi-judicial in nature, the arbitrator was bound, unless expressly absolved from so doing, to observe the ordinary rules which are laid down for the administration of justice...[27]"

373. His Honour recognised that while the express or implied agreement of the parties could operate to exempt the arbitrators from the obligation to apply ordinary court procedures, it could not exclude the overriding requirement that the fundamental principles of natural justice must be observed.

He characterised the fundamental requirements of natural justice as follows: "There are two rules or principles of natural justice (d_e Smith: Judicial Review of Administrative Action_ 3rd ed. p.135; Fairness and Natural Justice, by G.D.S. Taylor (1977), 3 Monash Law Review 191 at p.202). The first is that an adjudicator must be disinterested and unbiased. This is expressed in the Latin maxim - nemo judex in causa sua. The second principle is that the parties must be given adequate notice and opportunity to be heard. This in turn is expressed in the familiar Latin maxim - audi alteram partem. In considering the evidence in this case, it is important to bear in mind that each of the two principles may be said to have sub-branches or amplifications. One amplification of the first rule is that justice must not only be done but appear to be done; (Lord Hewart, C.J. in R. v. Sussex Justices; ex parte McCarthy, [1924] 1 K.B. 256 at p.259; [1923] All E.R. Rep. 233). Sub-branches of the second principle are that each party must be given a fair hearing and a fair opportunity to present its case. Transcending both principles are the notions of fairness and judgment only after a full and fair hearing given to all parties. [28]"

378. At the outset of trial, Mr Magee QC, senior counsel for the plaintiffs, reduced the original grounds of complaint to six principal matters. Those matters are:

1. The comments made by Rabbi Berger regarding "hate mail" sent to David Mond, which are said to give rise to a reasonable apprehension of bias.

2. The alleged comment made by Rabbi Berger at the meeting on 31 October 2001 that if David Mond did not accept the Or Chadash settlement proposal, Rabbi Berger would expel him from CHC. That alleged comment is submitted to give rise to a reasonable apprehension of bias or to constitute actual bias.

3. The alleged comment by Rabbi Katz at the meeting on 31 October 2001 that "You can't fight City Hall", which is also said to give rise to a reasonable apprehension of bias.

4. The arbitrators' conduct in continuing the arbitration on 31 October 2001 when Rabbi Abraham departed for England without completing his evidence, and their subsequent treatment of that matter in the Partial Award. In particular, the plaintiffs submit that the reference in the Partial Award to a "ruling" that it would be unjust to delay Rabbi Abraham's departure further, amounts to misconduct in circumstances where no such ruling was made.

5. The failure of the Partial Award to determine the issue of eligibility for membership of CHC referred to the arbitrators for determination; further and alternatively, the delegation of their arbitral function in relation to that matter to a third party, Mr Paluch.

6. The inclusion in the Partial Award of the findings on Or Chadash, which the plaintiffs contend was not a matter properly within the reference and hence, the arbitrator's jurisdiction.

387. Mr Hammond QC, senior counsel for the fourth to twenty-fourth defendants, contended that:

(a) Any application to the Court in relation to the Partial Award itself was premature, because the Partial Award was both partial and interlocutory, in the sense that it dealt with only some of the matters referred for determination and dealt with those matters only provisionally. Thus the appropriate course at this stage was to submit any complaints to the arbitrators.

(b) Rabbi Berger's comments about the hate mail did not create a reasonable apprehension of bias.

(c) Rabbi Berger did not state that David Mond would be expelled if he did not accept the Or Chadash settlement proposal. Rather, he stated that the arbitrators had an application to penalise David Mond, which included expulsion, which CHC expected to be determined, one way or the other, unless the necessity were averted by David Mond's acceptance of the Or Chadash settlement proposal.

(d) Neither the version of Rabbi Berger's comment alleged by the plaintiffs nor the version alleged by the fourth to twenty-fourth defendants constitutes bias at common law or under Halacha.

(e) Rabbi Katz did not state "You can't fight City Hall." Rather, he said words to the effect that "There is a saying in the US, never take on City Hall unless you can afford it," in the context of a discussion on costs.

(f) Neither the version of Rabbi Katz's comment alleged by the plaintiffs nor the version alleged by the fourth to twenty-fourth defendants gives rise to an appearance of bias or constitutes bias at common law or under Halacha.

(g) Under the arbitration agreement, Jewish arbitration procedure was to apply. Jewish procedure permits partiality in a "borer" (an appointed dayan) in a zabla in relation to the arbitral hearing and in settlement negotiations prior to the making of the award. Jewish procedure also permits a borer to communicate privately with his appointor. The "shalish" (the third judge selected by the two appointed judges) is not in that position.

(h) None of the matters complained of amounted to misconduct, either individually or collectively.

(i) If the Or Chadash issue or any other issue dealt with in the Partial Award is found to be outside the arbitral reference and beyond the arbitrator's jurisdiction, the appropriate remedy would be to set aside only that part of the Partial Award and to remit the Partial Award to the arbitrators.

ARBITRATION AGREEMENT AND AWARD GOVERNED BY VICTORIAN LAW

393. The arbitration agreement expressly states that the decision of the arbitrators "shall be final and binding on all parties and enforceable under the relevant Commercial Arbitration Act of Victoria".

396. The arbitration agreement also provides for the conduct of the arbitration "according to Jewish law and the rules of procedure established for and customarily employed in references to arbitration before a Beth Din, a Jewish Court of Law".

399. The plaintiffs submit that, properly construed, the agreement does not provide that Jewish law is the substantive law to be applied to the determination of the claims. They contend that the terms of the arbitration agreement do not expressly so provide, and that questions of compliance with the Associations Incorporation Act 1981 would necessarily require determination in accordance with Victorian law.

402. In my opinion, the terms of the arbitration agreement on the better view, provide that the claims be determined in accordance with Jewish law. In so far as Jewish law itself requires conformity with, or the application of, local law ( at least where the parties so agree ) claims arising pursuant to a Victorian statute may be determined. Agreement to decide issues determinable only under a Victorian statute pursuant to a Victorian law may be implied. Further, the claims and counterclaims in dispute included matters, such as the propriety of an application by a Jew to a secular court, which would necessarily require determination under Jewish law. In Soleimany v Soleimany[29] the Court of Appeal proceeded on the basis that an arbitral reference expressed in almost identical terms to that in the present case provided for the application of Jewish law, albeit other systems of law could be applied by way of the doctrine of incorporation.

405. In my opinion in the present proceeding, "misconduct" must be determined in accordance with Victorian law, although particular requirements of conformity with natural justice may be modified by reference to the procedure selected by the parties, provided that the fundamental requirements of natural justice are satisfied.

408. This is so whether the arbitration agreement, properly construed, provides for determination of the claims in accordance with substantive Jewish law or whether it merely adopts Jewish arbitration law and procedure.

411. In Soleimany v Soleimany[30], partners conducting a carpet export business from Iran agreed to refer their dispute over the division of the proceeds of sale to a Beth Din for determination according to Jewish law. The Beth Din found that the export of the carpets from Iran was illegal but under Jewish law the illegality of the enterprise did not preclude the enforcement of the plaintiff's claim to a share of the proceeds of sale. The plaintiff sought unsuccessfully to enforce the award in England.

414. The Court of Appeal held that the judgment of a foreign court, recognising and enforcing a contract entered into with the object of committing an illegal act in a foreign and friendly state, would not be recognised by an English court, on the grounds of public policy. An award recognising such a contract would be in the same position.

417. Their Lordships[31] referred to London Export Coporation Ltd v Jubilee Coffee Roasting Co Ltd[32] where Diplock J. stated:

"When the arbitration agreement has been construed and no breach of the agreed procedure found there may nevertheless arise a second and separate question: that is, whether, as a matter of public policy, a particular award, made pursuant to that agreed procedure, ought not to be enforced and ought, therefore, to be set aside, for an arbitrator's award, unless set aside; entitles the beneficiary to call upon the executive power of the state to enforce it, and it is the function of the court to see that the executive power is not abused."[33]

421. They further relied[34] on McNair J's recognition in James Laing, Son & Co (M/C) Ltd v Eastcheap Dried Fruit Co (No. 2)[35] that:

"An English court exercises control over the enforcement of the arbitral award as part of the lex fori, whatever the proper law of the arbitration agreement or the place where the arbitration is conducted. If a claimant wishes to invoke the executive power in this country to enforce an award in his favour, he can only do so subject to our law."[36]

425. McNair J. further observed that the then current English arbitration legislation in effect provided that the enforcement of awards would be governed by English law, even if it were not otherwise the law applicable to the arbitration. Although there was no express provision in the preceding arbitration legislation, which governed the dispute before him, he considered that the same conclusion applied. He concluded:

"It follows that an award, whether domestic or foreign, will not be enforced by an English court if enforcement would be contrary to the public policy of this country."[37]

429. In Soleimany v Soleimany[38] the Court of Appeal concluded that English courts declined to enforce illegal contracts not for the sake of the individual parties but in order to preserve the integrity of the court's process and to see that it was not abused. Morritt and Waller L.JJ and Sir Christopher Staughton observed: "The parties cannot override that concern by private agreement. They cannot by procuring an arbitration conceal that they, or rather one of them, is seeking to enforce an illegal contract. Public policy will not allow it. In the present case the parties were, it would seem, entitled to agree to an arbitration before the Beth Din. It may be that they expected that the award, whatever it would turn out to be, would be honoured without further argument. It may be that the plaintiff can enforce it in some place outside England and Wales. But enforcement here is governed by the public policy of the lex fori".[39]

432. In my opinion, the same position applies under the Act. It follows that in the present case the arbitration agreement, the requirements of an award and the enforcement of the award, are governed by, and must conform to, the law of Victoria.

435. Although this is an application to set aside the Partial Award rather than an application to enforce it, the above principles apply equally. As Diplock J. recognised, if an award is not set aside, it may be enforced. Section 33 of the Act provides that an award may be enforced by leave of the court, in the same manner as a judgment or order of the court, and judgment may be entered in terms of the award.

438. In summary, if the arbitration or the making of the Partial Award involved conduct which amounted to misconduct within terms of the Act, then although it was permitted under Jewish law or procedure, as in Soleimany, the Partial Award will not be enforced, and is liable to be set aside, by a Victorian court.

442. The fourth to twenty-fourth defendants contend that certain procedures and practices which could constitute bias or a breach of the rules of natural justice pursuant to common law, and standard curial procedure, or "misconduct of the proceedings" in terms of the Act, are permissible pursuant to Jewish law and the procedure customarily employed in reference to arbitration before a Beth Din, to which the parties agreed.

(a) That the arbitral tribunal constituted a zabla, pursuant to Jewish law, in which a borer (the dayan appointed by one party) may advise and freely communicate with the appointor both prior to and during the Din Torah and may properly be "partial" and act in the interests of the client both prior to and during the hearing, although he must ultimately decide the dispute honestly and in an unbiased way.

(b) That a borer in a supervised mediation where the parties' goal is settlement may properly put what he perceives to be the outcome of a Din Torah.

(c) That a Din Torah may make a Partial Award.

(d) That a Din Torah may make an award which affects the rights of, and is enforceable against, strangers to the arbitration agreement if they are members of a corporate congregation which itself is party to the arbitration agreement.

451. The fourth to twenty-fourth defendants bear the onus of establishing the status and provisions of Halacha as foreign law by expert evidence. The assumption that Halacha constitutes foreign law was uncontested. The fourth to twenty-fourth defendants rely upon the evidence of Professor Broyde, set out in his affidavit affirmed on 1 December 2003.

454. Professor Broyde affirmed two affidavits in the proceeding on 15 April 2003 and 4 November 2003. He affirmed a third affidavit on 17 November 2003. Professor Broyde was scheduled to give evidence by video link on 2 December 2003. On 19 November 2003 the plaintiffs foreshadowed that they might object to the admission of his evidence. On the morning of 21 November 2003 the fourth to twenty-fourth defendants applied for a direction that the plaintiffs state any objections by noon on 21 November 2003 in order to prepare their response. Mr Magee QC, senior counsel for the plaintiffs, had not yet determined his response. Whilst encouraging notice of objections prior to the calling of witnesses where possible, I had not previously directed that prior notice be given. I therefore declined to direct that the plaintiffs give notice of any objections by the proposed deadline.

457. Ultimately, the plaintiffs objected to substantial portions of Professor Broyde's affidavits on a number of grounds set out in a written submission dated 24 November 2003. They required the fourth to twenty-fourth defendants to make formal application for leave to rely on the affidavit affirmed on 17 November 2003. Mr Magee QC submitted that the Broyde affidavit of 17 November 2003 constituted a "running commentary" produced at a late stage of the trial which amounted to advocacy or submissions on behalf of the defendants. There was no indication that the deponent understood the duties of an expert witness to the court, no indication of the instructions given to the witness and no indication of what questions had been asked.

460. Mr Magee QC contended that in such circumstances, there could be no confidence in the expert's independence. The Broyde affidavit circumvented the purpose of rule 44 of the Supreme Court Rules and introduced new material after the closure of the plaintiffs' case. He did not oppose the receipt of the affidavit save for some specific objections. In my opinion, there was force in the plaintiffs' contentions. The fourth to twenty-fourth defendants sought, and were granted, a day's adjournment in order to address the plaintiffs' objections. During the course of that day, a new compendious affidavit of Professor Broyde ultimately affirmed on 1 December 2003, ("the fourth Broyde affidavit") was prepared, which incorporated much of the material included in his three previous affidavits. In addition to the objections raised by the plaintiffs in their written submissions, the fourth Broyde affidavit sought to meet a further fundamental objection to the previous Broyde affidavits, which in many instances appeared to breach the principle that an expert must not usurp the function of the court by purporting to determine the facts of the particular case and to apply the foreign law (as testified to by the expert) to those facts[40].

463. The fourth Broyde affidavit adopted the technique of assuming a particular fact of this case and proceeding (without any express nexus) to state a general proposition of Jewish law which appeared to be relevant to, and determinative of, the legal significance of the assumed fact.

466. The value of expert evidence on foreign law depends upon the stated assumptions of fact. Where incomplete facts were assumed, rather than a complex web of facts in context, little weight could be attributed to Professor Broyde's evidence. Further, his affidavit in many instances failed to expose the basis of the expert's conclusions for critical assessment by the court. It frequently failed to define key terms with sufficient precision to allow the court to ascertain the relevance of any conclusion to the disputed issues before it.

469. Professor Broyde's evidence on the partiality permitted to a borer, partial awards, the position of non-parties to the arbitration agreement (Or Chadash) and the jurisdiction of arbitrators to determine matters not expressly referred for decision under Halacha, appeared too general to be of much assistance.

472. Leave was granted to file and serve the fourth Broyde affidavit, the majority of which was admitted, with the caveat that in relation to certain issues, it would be of little assistance to the court.

476. The plaintiffs complain that the arbitrators' handling of Rabbi Abraham's departure prior to the completion of his cross-examination, the reference to a "ruling" on that issue in the Partial Award and the publication of the Partial Award without the completion of Rabbi Abraham's evidence, amount to misconduct. A number of distinct species of misconduct are allegedly involved.

479. First, the plaintiffs submit that one or more of the arbitrators had foreknowledge of Rabbi Abraham's departure and feigned surprise when he failed to appear at the hearing on the morning of 31 October 2001.

482. Secondly, the plaintiffs submit that the making of the Partial Award, (including findings on Rabbi Abraham's conduct) without the plaintiffs having the opportunity to complete Rabbi Abraham's cross-examination was a breach of the rules of natural justice.

485. Thirdly, the plaintiffs submit that the reference in the Partial Award to a "ruling" was not only inaccurate but was deliberately calculated to convey a false impression that Rabbi Abraham's departure had been formally dealt with, and ruled on, in the course of the open arbitration hearing.

" Rabbi Abraham Rabbi Abraham testified before us Monday 29th October. The hearing terminated before Mr Mond's counsel had concluded the cross-examination and had consequently indicated that he required Rabbi Abraham for a short time [sic] next day. The following day was largely devoted to an attempt to settle the dispute. Rabbi Abraham attended and was told that he was not required then and would be informed when he would be require [sic]. Mr Mond's counsel called for him on Wednesday 31 October at 11.30 AM. Rabbi Abraham was scheduled to depart to England on that day. Indeed, he had previously agreed, at the request of the Beth Din, to delay his departure by two days. Furthermore, Mr Mond's counsel was urged to allow Rabbi Abraham to testify earlier in the proceedings. That offer was rejected on the basis that that change would seriously impede their presentation of the case. In the circumstances, the Dayanim, by a majority, ruled, having [sic] into account all circumstances, that it would be unjust to delay his departure. The Beth Din had offered, if required, to arrange for him to testify in England as provided for in Halacha and law. Nevertheless, we feel confident to proceed to issue this partial award."

492. When the hearing concluded on the evening of Monday, 29 October 2001 Rabbi Abraham had not completed his cross-examination. It was intended to resume the following day. Instead, on Tuesday, 30 October 2001 the plaintiffs made an open offer of settlement and negotiations occupied most of the day.

495. Rabbi Abraham returned to the CHC premises and met with the dayanim at about 2.45p.m. on 30 October 2001, while they were looking at the plaintiffs' settlement offer, intending to complete his cross-examination. The dayanim told him that there was no need to remain, as the parties were still negotiating.

498. In cross-examination at trial, Rabbi Ulman agreed that Rabbi Abraham was in "a high state of agitation, was crying at one stage during his meeting with the dayanim on 30 October, and was complaining about the way that Mr Heath had cross-examined him." His lack of composure was such that Rabbi Ulman had no expectation that he would reappear to continue giving evidence on 31 October 2001. Similarly, Mr Romer, the solicitor responsible for organising the fourth to twenty-fourth defendants' witnesses, was not surprised by his non-attendance.

501. Both Rabbi Berger and Rabbi Ulman deposed that they did not communicate with Rabbi Abraham except for during the above meeting , and while he was giving his evidence at the hearing.

504. Rabbi Abraham was still in Melbourne on the morning of 31 October 2001. The dayanim were not at the CHC Board meeting on the morning of 31 October 2001 which Rabbi Abraham attended briefly to take leave of certain persons present.

507. It was known by all relevant parties from the outset of the arbitration that Rabbi Abraham was anxious to take up a new position in London. By 30 October 2001, he had already delayed his originally scheduled departure but was due to leave at some time during 31 October 2001. The plaintiffs regarded him as an important witness and Mr Heath of counsel was anxious to complete the cross-examination within the time that Rabbi Abraham was available. Both parties had suggested various courses to facilitate that. The fourth to twenty-fourth defendants had suggested that Rabbi Abraham precede Rabbi Krasnjanski, but Mr Heath rejected that proposal.

510. There was no application made by or on behalf of Rabbi Abraham for leave to depart prior to the completion of his cross-examination. The dayanim did not give Rabbi Abraham leave to depart, either publicly or privately. In the ordinary course he would have been expected to resume his evidence on 30 October 2001. The plaintiffs clearly expected that he would be present.

513. The hearing resumed at 11.30 am on 31 October 2001. Rabbi Abraham did not appear. The rejection of the plaintiffs' offer of settlement having been advised, Mr Heath of counsel sought to proceed with the hearing of the matter. He noted that there was one practical concern. He stated:

"It's the fact that at some stage this afternoon Rabbi Abraham, whose cross-examination I have not completed, is scheduled to board a plane destined for London, the wife and children are also scheduled to board that plane at a time of which I'm not aware. I sought a number of undertakings yesterday that he would be available for cross-examination, for further cross-examination, and I thought the matter was clear, it's not a matter for submissions as to whether he needs to come along and to subject himself to further cross-examination. The fact of the matter is that I have further questions which I wish to put to him."

517. Mr Heath further stated that natural justice required that he be given an opportunity to complete his cross-examination of Rabbi Abraham. He adverted to the possibility of a subpoena.

520. Rabbi Berger, in response, stated "My suggestion is, let's try and see what his position is, and we'll deal with it accordingly. Let's see, maybe he's all packed and ready to come. Let's try and get hold of him".

523. Rabbi Berger repeated comments to similar effect and proposed an attempt to contact Rabbi Abraham. There was a short adjournment, during which there was an unsuccessful attempt to contact Rabbi Abraham.

526. In re-examination, Rabbi Ulman stated that he recollected that during the adjournment to locate Rabbi Abraham, the dayanim "were all eager to try to bring Rabbi Abraham to the Din Torah if the time allows, if the plane - if his plane is leaving later."

529. The arbitration transcript reveals that Mr Heath reserved the plaintiffs' rights to challenge the arbitration on the basis of a breach of the rule of natural justice. The issue of whether declaratory relief should be sought was discussed. Rabbi Berger testified, and the arbitration transcript reveals, that he urged Mr Heath to apply to the civil courts sooner rather than later.

532. The arbitration transcript indicates that Rabbi Berger asked what could be done to remedy any shortcomings created by Rabbi Abraham's absence. The possibility of video link evidence was discussed.

535. Rabbi Berger was cross-examined in relation to the departure of Rabbi Abraham and the treatment of the matter in the Partial Award. He then stated for the first time that Mr Heath, counsel for the plaintiffs, "wanted our permission to apply to issue a subpoena. And we've declined to give that permission". It is not apparent on what basis the dayanim's permission would be necessary. Rabbi Berger testified that the request, which took place in chambers, constituted the ruling referred to in the Partial Award. When asked when the ruling was made he replied "That's a good question ... It was decided to do nothing essentially. The ruling was, it wasn't very much of a ruling, but it decided to do nothing. They take no steps to restrain him from leaving the country. That's essentially what it was".

538. He conceded that he at no stage told Mr Heath that the dayanim had ruled that it would be unjust to delay Rabbi Abraham's departure. He stated that he believed whether the decision to do nothing was a "ruling" or "permission" was a question of semantics. He confirmed that one of the dayanim dissented on the question of whether Rabbi Abraham's departure should be further delayed.

541. In cross-examination Rabbi Ulman did not contend that CHC had at any stage applied for a ruling permitting Rabbi Abraham to depart prior to the completion of his evidence. Rather, he contended that the dayanim at a certain stage on Wednesday, 31 October 2001, after they discovered that Rabbi Abraham had already departed for the airport, "decided" that it was not justified to delay further Rabbi Abraham's departure.

544. Rabbi Ulman appeared uneasy in responding to questions on whether a ruling was made. He apparently regarded the plaintiffs' desire to have Rabbi Abraham available for cross-examination on 31 October 2001 as the "application" on which the "ruling" was based.

547. He was unable to recollect how or when the "application" or "ruling" was made or how or when the decision was made public. Rabbi Ulman's evidence was inconsistent, confused and reluctant on this issue. Ultimately, after some initial hesitation, he stated that he had "no expectations" as to whether Rabbi Abraham would or would not turn up on 31 October 2001 to complete his evidence, while conceding that it would normally be a gross discourtesy for a rabbi to leave without first obtaining permission from the Din Torah before completion of his cross-examination.

550. It is recognised that although "moral turpitude is not a necessary ingredient of misconduct ... misconduct would almost certainly arise where an arbitrator has consciously sought to abuse his or her position."[41]

553. If the evidence established that the dayanim, or any one of them, had colluded or knowingly acquiesced, in Rabbi Abraham's unauthorised departure, or misled the plaintiffs or lulled them into a false sense of security concerning his availability, in my opinion it would amount to misconduct within terms of s.42 of the Act. Similarly, if the dayanim, or any one of them, having foreknowledge of Rabbi Abraham's departure, had failed to disclose it when he did not appear at the hearing on 31 October 2001 and had feigned ignorance, in my view it would constitute misconduct.

556. However, I do not consider that the evidence establishes that the dayanim, or any one of them, either colluded in Rabbi Abraham's unauthorised departure or had foreknowledge of it. The evidence establishes that the dayanim were unlikely to have been surprised when it was ascertained that Rabbi Abraham would not reappear as scheduled. They were not, however, responsible for ensuring the attendance of witnesses and were not required to intervene in order to ensure their attendance.

559. It follows that I do not consider that misconduct is established by reason of the dayanim having foreknowledge of Rabbi Abraham's departure, colluding in it, feigning ignorance of it or otherwise deliberately misleading the plaintiffs and their counsel.

562. Further, I do not consider that proceeding to make an award without the recall of Rabbi Abraham constituted misconduct on the basis of a breach of the rules of natural justice. A fundamental principle of natural justice requires that the parties must be given adequate notice and an opportunity to be heard. They must also be given a fair hearing and a fair opportunity to present their case.

565. That principle is recognised in the Partial Award to constitute one of the rules of Jewish law and procedure, which expressly states that each party is to be given "the opportunity to hear his opponent's case and is given the opportunity to test and rebut it by cross-examining his witnesses, presenting rebutting evidence and addressing oral argument".

568. The parties to an arbitration under the Act have great freedom to agree on procedure. As Rogers C.J. observed "so far as the letter of the Act is concerned, it gives the parties the greatest possible freedom in the conduct of the arbitration... laws of evidence need not be followed. The sole requirement in the "letter and spirit" of the Act is the call of natural justice, which, whilst requiring that each party may have a proper opportunity of putting its own case, and meeting the case for the other party, does not require adherence to court procedures as necessary".[42]

571. There is no evidence to suggest that under the rules of procedure customarily employed in arbitrations before a Beth Din, the arbitrators would not be empowered to direct that a witness, already delayed in meeting a pre-existing commitment, could depart and complete his or her evidence by video link or by some other means. If a witness departed without leave, there is no evidence to establish that they could not properly determine to take no action other than, for example, directing alternative arrangements for giving evidence. The rules of natural justice require only that a reasonable opportunity to cross-examine witnesses be afforded. They do not require the arbitrators to refrain from making an award in circumstances where the opportunity was offered but was not taken up. Similarly, natural justice does not require that the cross-examination necessarily be completed by the witness present in person. In appropriate circumstances, balancing all relevant circumstances, an opportunity to examine witnesses by video link or other means would fulfil the requirements of natural justice, although some forensic advantage may be lost.

574. In the present case, the arbitral transcript indicates that the dayanim were willing to order that Rabbi Abraham complete his cross-examination by video link. The plaintiffs did not pursue their application in relation to Rabbi Abraham. Their complete withdrawal from the arbitration precluded that course. The non-participation of the Messrs Mond in the arbitration following the meeting on the evening of 31 October 2001 overtook the question of how and when Rabbi Abraham's evidence would be completed. In the circumstances, the arbitrators did not deny the plaintiffs the opportunity to complete the cross-examination.

577. Rather, the plaintiffs did not pursue their application for that opportunity, although the arbitrators had indicated that it would be afforded. In such circumstances, proceeding to make the Partial Award does not constitute misconduct. If, however, the plaintiffs were justified in their withdrawal on the basis of other matters which entitle them to have the Partial Award set aside, the issue of Rabbi Abraham will have no independent relevance to the plaintiffs' application. This is considered below.

580. There is the further question whether the reference to the "ruling" in the Partial Award itself constitutes misconduct, because it was included deliberately to misrepresent what occurred and to give a false impression of regularity to Rabbi Abraham's unauthorised departure.

583. If the arbitrators had made a formal ruling in response to a formal application without notice to the plaintiffs, or had privately given Rabbi Abraham leave to depart, it would constitute a breach of the rules of natural justice.

586. The evidence establishes that there was no application by, or on behalf of, Rabbi Abraham for leave to depart. No formal or informal ruling was made that it would be unjust to delay his departure. Rather, ex post facto and outside the arbitration hearing, at some time prior to the signing of the Partial Award, the arbitrators determined (by majority) to take no action in relation to the unauthorised departure.

589. The reference to the "ruling" in the Partial Award fails accurately to convey what occurred. It conveys the false impression that Rabbi Abraham departed only after receiving leave pursuant to a public formal ruling. The fourth to twenty-fourth defendants contend that it is, at worst, a mere misstatement or mistake of fact or law, which is outside the concept of misconduct.

592. In Gas & Fuel Corporation of Victoria v Wood Hall Ltd & Leonard Pipeline Contractors Ltd[43] Marks J. recognised that although mis-statements or misconceptions by an arbitrator are not in themselves misconduct, they may be viewed in their setting "for the purpose of determining in the context of the rules of natural justice what impression may have been made by them on the fair-minded observer, whether a party or member of the public.. In considering the question of technical bias a court must be able to look at a mistake or alleged mistake or misconception or mis-statement of argument by an arbitrator in combination with the process or path by which he came to make the impugned pronouncements... In my view, a mistake in law or fact or a misconception or mis-statement of an argument by an arbitrator is capable of scrutiny in order to determine whether it was so expressed and/or occurred in such a setting and/or was itself of such a nature, that a reasonable suspicion might be aroused in the mind of a fair-minded observer that the mistake, misconception or mis-statement stemmed from or was associated with a failure to consider relevant contentions and/or submissions with a fair and unprejudiced mind. Further, such examination may be made to determine whether particular mistakes, misconceptions or mis-statements occurring in one setting, when considered in a general context in which there were other mistakes, misconceptions, mis-statements and/or irregularities, contribute to an overall or generally based suspicion of the kind with which we are concerned. A further point of such an exercise may be to determine whether there developed a trend or pattern which had the effect or appeared with reason to have the effect, or [sic] unfairly disadvantaging a party"[44].

595. In my opinion, the reference to the ruling on Rabbi Abraham's departure in the Partial Award, while not in itself misconduct, has the effect of glossing over or mitigating the irregular or unauthorised conduct of one of the parties to the arbitration agreement. As such, when taken in the context of all the other circumstances of this case (discussed below) in Marks J's terms, it contributes to a reasonable suspicion of a lack of impartiality, and is part of a trend or pattern which appeared, with reason, to have the effect of unfairly disadvantaging the plaintiffs.

599. The plaintiffs allege that certain comments which were made by the dayanim give rise to a reasonable apprehension of bias, or demonstrate actual bias, and hence constitute misconduct within terms of s. 42 of the Act.

602. The fourth to twenty-fourth defendants admit that one of the comments relied on by the plaintiffs was made, but contend that, taken in context, it does not amount to bias. The fourth to twenty-fourth defendants deny that the other two comments alleged by the plaintiffs were made.

605. They further contend that if the alleged comments were made, they do not constitute bias. In this context, they contend that although misconduct must be judged according to Victorian law, it is a flexible concept which may be modified by the law and procedure agreed upon by the parties to the arbitration. The fourth to twenty -fourth defendants allege that Rabbi Berger was their appointed borer and that according to Halacha, the borer may demonstrate partiality during the course of the arbitral hearing although he must be impartial in the determination of the dispute.

608. Finally, the fourth to twenty-fourth defendants contend that if bias be otherwise made out, the plaintiffs' failure to make a timely objection and a formal application to the tribunal to disqualify the maker of the relevant statement constituted waiver, disentitling the plaintiffs from reliance on the comments.

612. The first statements alleged to constitute bias were conveniently designated at trial, Rabbi Berger's "hate mail comments".

615. The transcript of the arbitration hearing for Thursday, 25 October 2001 sets out David Mond's complaint about his receipt of hate mail following the Magistrates' Court hearing which, in addition to other vindictive comments, referred to him as a Nazi or "Kapo".

618. The transcript records that Rabbi Berger stated:

"The letter certainly was a consequence of the court case. Question is, is it a consequence of the plastering of the Schule [synagogue] with those previous pamphlets. I mean you appear to have indicated ... ... You see, the point I'm making is a simple one. If it flowed as a consequence of the reporting of the court case brought by Mr [sic] somebody has taken umbrage to the fact that an individual takes the synagogue to the civil court, then Mr Mond has got only himself to blame. If on the other hand, it came as a consequence of what he terms a hate campaign, that's a different matter. But who is to say?"

622. Whether David Mond was justified pursuant to Halacha in making the applications to the Magistrates' Court was a question which both David Mond and the fourth to twenty-fourth defendants sought to be determined by the arbitrators.

625. In his opening address at the arbitration hearing Daivd Mond sought a declaration or order that he "be found to have acted in accordance with Halacha in the process leading to the first injunction hearing and the second injunction hearing". David Mond also claimed that Rabbi Abraham incited hatred of him "resulting in hate mail and personal abuse as well as abuse and mistreatment of my family".

628. At the outset of the arbitration hearing Mr Havin, counsel for the fourth to twenty-fourth defendants, stated that "the entitled [sic] of Mr Mond to make the applications were matters that were issues for us, the Congregation". Further, Mr Havin stated "Jewish Law regards as a serious infraction, a most serious infraction, attending non-Jewish Courts. In the course of this litigation, the Dayanim will make up their own minds about whether the obtaining of an injunction comes under that rubric or not, and the second application as well".

631. The existence and disclosure of a judge's preconceived views do not necessarily infringe the requirements of the reality and appearance of impartial justice. An "ill-defined" line exists between, on the one hand, preconceptions which do not exclude a fair and unprejudiced state of mind, and, on the other, disclosed preconceptions which would lead one or other of the parties, or a reasonable and intelligent lay observer, to conclude that the judge may not approach the determination of the case fairly and impartially[45].

634. One of the issues which, by common consent, was submitted to the dayanim for determination was whether David Mond was justified under Halacha pursuant to an exception to, or dispensation from, the general prohibition on an application to a secular court by one Jew against another. In that context, Rabbi Berger's comment that David Mond had "only himself to blame" if the hate mail were provoked by David Mond's taking proceedings against the synagogue in a secular court would, in my opinion, give rise to a reasonable apprehension of bias. The comment indicates that David Mond's application to a secular court was unjustifiable in any circumstances, and so inexcusable that David Mond, rather than the sender, was to blame for the hate mail which compared him to a Nazi. The obvious implication of such comparisons was to equate David Mond with those guilty of notorious crimes against humanity and the Jewish people in particular. The comparisons convey a devastating condemnation of David Mond which Rabbi Berger's response could be seen to endorse. The hearing was only in the second day, the evidence was not completed and final submissions had not been made. The comment, in my opinion, goes beyond the disclosure of a mere preconceived view. It could indicate a closed mind on an important question to be decided in the case. It would, in my opinion, give rise to a reasonable apprehension or suspicion in a fair-minded observer, with knowledge of the material facts, that Rabbi Berger might not bring an impartial and unprejudiced mind to the resolution of the matters before him and may have condemned David Mond without a full hearing.

637. David Mond deposed that he was shocked by Rabbi Berger's comments. He nevertheless continued to take part in the arbitration. His counsel took no objection and made no application in relation to the comments. On the evening of 31 October 2001, David Mond made a speech which did not indicate dissatisfaction with the hearing he had received. The Messrs Mond abandoned the arbitration only after the meeting on 31 October 2001. The significance of a failure to take objection to a comment which could convey a reasonable apprehension of bias is discussed in detail below.

Alleged Comments at the Evening Meeting on 31 October 2001

641. The plaintiffs rely on two comments allegedly made by Rabbi Berger and Rabbi Katz respectively at a meeting between the arbitrators, the plaintiffs and the plaintiffs' legal representatives on 31 October 2001, as constituting bias and hence misconduct within terms of s. 42 of the Act.

644. Seven persons attended the evening meeting which took place in an upstairs room at the CHC Synagogue on Wednesday, 31 October 2001. They were: Rabbi Berger, Rabbi Katz and Rabbi Ulman; the plaintiffs, Messrs David and Barry Mond; the plaintiffs' counsel, Mr Heath, and the plaintiffs' solicitor, Mr Janover. Rabbi Berger and Rabbi Ulman gave evidence on behalf of the fourth to twenty-fourth defendants. Messrs David Mond, Barry Mond and Mr Janover gave evidence on behalf of the plaintiffs. Rabbi Katz and Mr Heath did not give evidence. Their failure to do so is discussed below.

(a) Rabbi Berger broached a settlement proposal involving the relocation of Or Chadash from the CHC Synagogue and stated that if David Mond did not accept the settlement proposal, Rabbi Berger would expel him, or "throw him out" as a member.

(b) Rabbi Katz stated at the meeting "You can't fight City Hall".

653. There is a clear but subtle conflict of evidence concerning what was said, and in what context, at the meeting. The fourth to twenty-fourth defendants deny that the alleged comments were made. They submit that Rabbi Berger and Rabbi Katz made comments which, while similar to those alleged by the plaintiffs, were in different terms and in different contexts.

657. According to Mr Janover, the plaintiffs' solicitor, the meeting was called by, or on the initiative of, Rabbi Berger. The Messrs Mond testified that the meeting was quite short, lasting between 15 to 20 minutes. Mr Janover testified that it "might" have lasted for up to 30 minutes.

660. According to the plaintiffs' witnesses, David Mond was upset but subdued in demeanour. He was self-controlled and was not sobbing or shaking. David Mond stated at the meeting that he was upset and he referred to the adverse effects of the proceeding on his family. He otherwise said little. He did not at any stage repeat any speech made in the course of the arbitration. He did not plead for the termination of the arbitration or confess to the dayanim that he was unable to fund the proceeding further against the better - resourced CHC.

663. According to the plaintiffs' witnesses, at the meeting Rabbi Berger almost immediately broached a settlement proposal, to the effect that Or Chadash should leave the CHC Synagogue and would receive some financial assistance from CHC to do so. David Mond responded that Or Chadash was not a party to the arbitration and he could not speak for the Or Chadash group.

666. They also unanimously deposed that, in response, Rabbi Berger stated that unless the settlement proposal were accepted, he would expel or throw out David Mond.

669. The plaintiffs' witnesses deposed that David Mond did not respond to the threat to expel him but remained silent. His brother, Barry Mond, rose in outrage and protested that if David Mond were expelled, it would be necessary to expel Barry Mond and his entire family.

672. Mr Janover agreed with the evidence of Rabbi Berger and Rabbi Ulman that he made some suggestions on the possible settlement with Or Chadash. The Messrs Mond did not recall Mr Janover making such suggestions.

675. The plaintiffs' witnesses all deposed that after the outburst by Barry Mond, Rabbi Katz stated: "You can't fight City Hall".

678. The plaintiffs' witnesses deposed that towards the end of the meeting Rabbi Berger embraced David Mond in a "bear hug". According to David Mond, he did not initiate the embrace with Rabbi Berger, whom he at that stage regarded with distrust.

The Fourth to Twenty-Fourth Defendants' Account of the Meeting

683. Rabbi Berger deposed in his affidavit that to the best of his recollection, the meeting was called by the plaintiffs. At trial, he testified that he was approached by Mr Heath, counsel for the plaintiffs, who had said that "we ought to have a meeting or something of this nature" without specifying its purpose. Rabbi Ulman did not recall who called the meeting.

686. In their affidavits, which were identically worded on that issue, both Rabbi Berger and Rabbi Ulman deposed that the meeting lasted about half an hour.

689. In almost identical words in their affidavits, Rabbi Berger and Rabbi Ulman described David Mond's demeanour at the outset of the meeting as "a terrible state". Rabbi Berger additionally deposed that David Mond was sobbing and shaking as if in a fever. According to both Rabbi Berger and Rabbi Ulman, he said that day had been the worst of his life. They both deposed that "Instead of offering a fresh settlement proposal, he pleaded for the closing of the case on the basis that its continuation served no further purpose. He repeated the speech of the previous night that the matter had received a fair hearing, the respective positions were now crystal clear and he urged us to find that all parties acted in good faith in pursuance of what they believed were their rights and duties. He also told us of the devastating effect of this litigation on him and his family's health".

692. On cross-examination, Rabbi Berger conceded that a few minutes before, at the arbitration, David Mond had not appeared distressed. Rabbi Ulman at trial likewise did not recall that David Mond had appeared distressed during the arbitration hearing a few minutes before.

695. At trial, Rabbi Berger confirmed his deposition that David Mond was sobbing and shaking "as in a fever", and appeared to be in need of comfort. Rabbi Ulman at trial, however, denied that David Mond was sobbing or shaking as in a fever. According to Rabbi Ulman, David Mond's "terrible state" manifested itself by an upset and "very contrite" or defeated appearance. Rabbi Ulman's description accords with the description of the plaintiffs' witnesses.

698. Rabbi Berger and Rabbi Ulman, in contrast to the plaintiffs' witnesses' testimony, each deposed in their affidavits that David Mond repeated the speech of the previous evening. In cross-examination Rabbi Ulman stated that David Mond did not repeat his speech but "went along the same lines". Rabbi Ulman also stated in cross-examination that at the meeting, David Mond was "giving up" and seeking to have the arbitration abandoned.

701. At one point in cross-examination, Rabbi Ulman appeared to attribute the alleged surrender of David Mond to adverse testimony by his supporter, Mr Weil during the evening session of the arbitration hearing. At another point, Rabbi Ulman appeared to suggest that, contrary to his earlier account, David Mond's distressed and defeated state may not have been observable at the outset of the meeting, but occurred as a reaction to Rabbi Berger's comments about expulsion, which therefore must have occurred at an earlier stage in the meeting. Rabbi Ulman was then unsure whether David Mond might have been informed of the possibility of expulsion before the meeting itself.

704. According to the testimony of Rabbi Berger and Rabbi Ulman, David Mond pleaded unconditionally for the case to be discontinued. He did not seek orders or rulings from the dayanim in relation to any matters, such as eligibility for membership or costs but simply "wanted to give up without any further repercussions" or "without seeking some form of award". According to Rabbi Berger, David Mond essentially sought to call a halt to it "without discussing the form that halt should take".

707. Rabbi Berger and Rabbi Ulman testified that in contrast to the previous day, when he had made an offer subject to conditions, David Mond made no stipulation as to how costs to that date would be dealt with (although Rabbi Berger and Rabbi Ulman also testified that he was greatly concerned about the costs). Further, David Mond did not insist on a ruling on eligibility for membership of CHC which had concerned him from the outset, or on any other substantive issue in dispute.

710. The fourth to twenty-fourth defendants submitted that David Mond's sudden collapse of resolve at the meeting was attributable to damaging evidence given by Mr Weil at the arbitral hearing immediately prior to the meeting. Mr Weil was associated with Or Chadash and was a supporter of David Mond.

713. Mr Weil's evidence included an account of the history of Or Chadash and its relationship to the main synagogue, the existence of a register of members, the system of payment for seats in the synagogue, problems experienced by himself and David Mond in dealings with the CHC Board in relation to Or Chadash, the lead up to the scheduled CHC annual general meeting in September 2000 and the special CHC Board meeting on 13 September 2000 at which David Mond's pending application to the Magistrates' Court was discussed.

716. Mr Weil stated that he considered that the service of a subpoena on a longstanding employee of CHC (Mr Levin) was the wrong thing to do. He gave an account of David Mond's handling of that issue, and of dealings with Rabbi Heibrunn.

719. The arbitration transcript reveals that Mr Weil stated that he did not try to defend David Mond at the CHC Board meeting on 13 September 2000. In response to a question from Rabbi Berger whether "You felt it wrong?" Mr Weil replied: "I didn't feel it was right to try and defend him. I felt uncomfortable about the situation. But I didn't try to defend him". He further stated "I think I was very overwhelmed by the whole situation of actually seeing summonses there, and the fact that he actually - you know - I knew that he was considering doing it, but that he actually went ahead and did it".

"My feeling was, I could understand his frustration, because I'd felt this sort of frustration for many years. But I certainly wouldn't have the moral fortitude to do something like that".

726. I do not consider that Mr Weil's evidence was, on a fair reading, condemnatory of or adverse to David Mond. On one view, it expresses admiration of David Mond's courage. In my opinion, it provides no explanation for a sudden loss of self-control and dramatic capitulation by David Mond.

729. There is no convincing explanation for a sudden breakdown of David Mond's resolve and self-control at this juncture. It is not apparent why, if he were prepared to capitulate unconditionally in order to halt the proceeding, it would be necessary, or productive, to plead with the dayanim in order to do so. The dayanim were not empowered to terminate the arbitration prematurely on the application of one of the parties. Nor could they prevent one of the parties from abandoning its case. It is not plausible that David Mond's legal advisers and his brother, Barry Mond, passively observed him making an impulsive and ill-thought out appeal to the arbitrators, seeking an outcome that they could not grant, in circumstances where he had suffered a sudden and dramatic loss of self-control, "sobbing and shaking as if in a fever".

732. In their affidavits both Rabbi Berger and Rabbi Ulman, in almost identical words, deposed that Rabbi Berger, in response to David Mond's alleged pleading for discontinuance "said to him that whilst I had considerable sympathy for his predicament, terminating the hearing at that stage would be a serious dereliction of duty on the part of the arbitrators. We had before us an application by CHC to penalise the First Plaintiff for his conduct, which we understood to include the ultimate penalty, namely, expulsion. I said to the First Plaintiff that CHC expected us to rule on that application one way or another and we could not at that stage abandon the proceedings. On hearing that there was a possibility of ruling in favour of an expulsion the Second Plaintiff stated that if his brother were expelled, he and his own family would also have to leave CHC".

735. In their affidavits Rabbi Ulman and Rabbi Berger deposed that it was following that comment that Rabbi Berger suggested the settlement with Or Chadash as a "way forward". At trial, Rabbi Ulman was no longer certain that Rabbi Berger's reference to expulsion was in response to David Mond's pleading. Rather, he suggested that the reference to expulsion occurred early in, or preceded, the meeting. Although Rabbi Ulman deposed that Rabbi Berger spoke of the application to expel David Mond which was expected to be ruled upon one way or the other, he also deposed that both he and Rabbi Katz were of the view that the case of expulsion had not been made out. Further, while maintaining that there was an application before the dayanim to expel David Mond as a member of the CHC synagogue, Rabbi Ulman was unable to recall whether such application had been made in any document. Rabbi Ulman recalled a discussion at the meeting of the settlement proposal based on the relocation of Or Chadash. He stated in cross-examination that he "could not recall" Dayan Berger saying that if David Mond did not accept the offer, he would be expelled. Dayan Ulman also could not recall, nor did he deny, that Barry Mond on the following day had complained to him that Rabbi Berger had threatened to expel his brother and had blackmailed him with an ultimatum.

738. Rabbi Ulman testified that he was seated next to Rabbi Katz at the meeting. He stated that it was unusual for Rabbi Katz to speak publicly. Rabbi Ulman did not recall, nor did he deny, that Rabbi Katz stated: "You can't fight City Hall". Rabbi Ulman could not recall any comment about "City Hall" at all. He denied that he had later discussed that alleged comment with Barry Mond and had observed that it had surprised him. He was unable to recall or deny many other alleged comments in the conversation with Barry Mond.

741. At trial, Rabbi Ulman's recollection of events and statements was very poor. It was so limited, even in relation to significant events which on any view occurred, that it did not provide the strong support for Rabbi Berger's version of events which the similarity of their evidence on affidavit had foreshadowed. Rabbi Ulman also retracted, revised or modified some matters deposed to in his affidavit at trial.

744. In cross-examination he appeared uncertain about the sequence of some significant comments. His confident and detailed recollections were deposed to in his principal affidavit in virtually identical paragraphs to those included in Rabbi Berger's affidavit. Rabbi Ulman's principal affidavit was substantially identical to much of the affidavit of Rabbi Berger. That circumstance was explained as due to both Rabbi Berger and Rabbi Ulman giving instructions to their legal adviser, who formulated their instructions in identical form.

747. The level of detail provided in Rabbi Ulman's principal affidavit contrasts with his total failure to recall many significant matters at trial and his uncertainty on other issues. Both Rabbi Berger and Rabbi Ulman denied that either of them had copied the other's affidavit. While I am satisfied that the affidavits were not copied, Rabbi Ulman adopted a greater level of detail and certainty in his affidavit than he was ultimately able to replicate in his oral testimony.

750. Rabbi Ulman's evidence on the alleged ruling in relation to Rabbi Abraham was also vague. His evidence on his conversation with Barry Mond assumed the almost formulaic mantra that he could "neither recall nor deny". Due to his vagueness and lack of recollection about significant matters, Rabbi Ulman was not an impressive witness. He presented as an uneasy and reluctant witness who made very limited efforts to recall the events and statements at issue in the case. I am unable to place much weight on Rabbi Ulman's account of events.

753. Rabbi Berger testified that in the course of the meeting he stated that there was an application to penalise David Mond, including by expulsion. He stated that the application was not made in written form but "from memory" was made orally. The arbitration transcript indicates that no application for expulsion was made, in terms, by Mr Havin in his opening statement. The plaintiffs contended that an order for the immediate expulsion of David Mond from CHC could not be made in the arbitral award itself consistently with the Magistrates' Court injunction, even if the statutory requirements for expulsion from the corporate body had otherwise been met.

756. The Order of Magistrate O'Dwyer made 29 September 2001 injoined the expulsion of David Mond until the conclusion of the "Rabbinical Arbitration or further order". Rabbi Berger stated at trial that he believed that an order for expulsion of David Mond in the award was a possibility which was not inconsistent with the Magistrates' Court Order. However, he conceded in cross-examination that the dayanim had not decided, as at 31 October 2001, whether they had the jurisdiction or power to expel David Mond. His alleged comment to David Mond that the dayanim were expected to make a decision on an application for expulsion, one way or the other, did not, in my view, accurately reflect the necessity to determine jurisdiction.

759. Rabbi Berger presented as an intelligent, dignified and astute person of great presence and authority. His confidence and his subtle grasp of issues were obvious.

762. Ultimately, the differences between the conflicting accounts of the plaintiffs and Rabbi Berger are subtle.

765. Rabbi Berger did not deny that he indicated that the arbitrators might rule that David Mond be expelled, albeit pursuant to CHC's application, rather than due to his refusal to accept the Or Chadash settlement proposal. Rabbi Berger agreed that the Or Chadash settlement offer was broached at the meeting and that David Mond responded that it was not within his control.

768. Similarly, Rabbi Berger agreed that Rabbi Katz made a statement about "City Hall", but his alleged version of the comment is that it was a response to a complaint about costs. He had initially deposed that Rabbi Katz had stated that "There is a saying in the US, never take on City Hall unless you can afford it". At trial, he stated that, on further reflection, he did not recall the exact words spoken by Rabbi Katz but that they were to that effect. His affidavit was amended accordingly. While he did not recall the precise words spoken, Rabbi Berger nevertheless maintained that the words were not "You can't fight City Hall" and were spoken in relation to costs.

771. Rabbi Katz did not give evidence on his own behalf and was not called as a witness on behalf of the fourth to twenty-fourth defendants.

774. Rabbi Katz was represented by Mr May, the same legal practitioner who represented Rabbi Berger and Rabbi Ulman. Rabbi Berger and Rabbi Ulman each deposed that although it was ordinarily inappropriate for arbitrators to take an active part in proceedings which seek to challenge an award or in which allegations of misconduct on the part of the arbitrators are made " ... reluctantly and because of the serious nature of the allegations of misconduct made against the arbitrators, I have been advised by my solicitor to make this affidavit ...".

777. Mr Hammond QC, on behalf of the fourth to twenty-fourth defendants, submitted that although the plaintiffs have alleged misconduct constituted in part by the alleged comment of Rabbi Katz, I should draw an adverse inference against the plaintiffs pursuant to the rule in Jones v Dunkel[46], on the ground that they did not call Rabbi Katz. He also submitted that I should draw an inference adverse to the plaintiffs on the basis of their failure to call Mr Heath of counsel as a witness. Mr Heath was counsel for the plaintiffs at the arbitration and was present at the meeting on the evening of 31 October 2001.

780. I do not consider that an inference adverse to the plaintiffs should be drawn from their failure to call Rabbi Katz. There is no reason to believe that Rabbi Katz would not have received identical advice to that received by Rabbi Berger and Rabbi Ulman from their common legal practitioner, Mr May. The plaintiffs have levelled a serious charge of misconduct against Rabbi Katz and the other arbitrators. Rabbi Katz is a person whom it would be natural for the defendants to call, or whom they might reasonably be expected to call. He is himself a defendant and may legitimately be regarded as within the defendant's camp. It would be unrealistic to expect the plaintiffs to call him[47]. In the circumstances, I infer that Rabbi Katz' evidence would not have assisted the defendants, who failed to call him.

783. The fourth to twenty-fourth defendants submitted that I should draw an inference adverse to the plaintiffs, due to their failure to call Mr Heath. As the Messrs Mond and Mr Janover have given evidence of the meeting, no such inference should arise against the plaintiffs pursuant to the rule in Jones v Dunkel[48], which, as O'Loughlin J. observed in Cubillo v Commonwealth, should "not operate to require the giving of merely cumulative evidence, such that if five people attended a relevant meeting, and some are called, no Jones v Dunkel inference can normally arise against those who are not"[49].

786. The plaintiffs' witnesses were exhaustively cross-examined on their meeting with the arbitrators on the evening of 31 October 2001 and the subsequent hotel meeting with Rabbi Ulman. The plaintiffs' witnesses' evidence, discussed above, was not consistent on all matters. For example, the Messrs Mond could not recall Mr Janover's settlement suggestions, to which Mr Janover testified. The Messrs Mond did not have, as they conceded, a comprehensive recollection of events. They were not, in all cases, capable of reconstructing the precise sequence of events, the precise form of words or of estimating the effluxion of time within a fine compass. Mr Hammond QC contended that their inability to account for the total time consumed by the meeting (even on their own lesser estimate) supported Rabbi Berger's version of events. He submitted that the Messrs Mond, who conceded that they were unable to recall aspects of the meeting, may have misheard.

789. Inability to recall the precise phraseology used, the precise sequence of events, to estimate time or the minutes which elapsed between events, to reconstruct the demeanour or feelings which accompanied particular statements, or to recall exhaustively all that took place, does not, in my view, detract from the credibility of the plaintiffs' witnesses' evidence on the essential events and "core" statements in dispute.

792. In my opinion, Messrs Janover, David Mond and Barry Mond were impressive, conscientious and direct witnesses. They presented credible and convincing accounts of the essential events and sequence of the meeting and of the statements which were made at it. Rabbi Berger's conflicting account of the meeting was not corroborated by Rabbi Katz and was not supported by convincing evidence from Rabbi Ulman. It is based upon improbable or inexplicable circumstances, including a sudden unconditional capitulation by David Mond, and other matters discussed in detail above.

795. I consider the Messrs Mond and Mr Janover to be witnesses of truth. In all the circumstances, I am unable to accept that Rabbi Berger's conflicting recollection of the principal disputed events and statements at the meeting is accurate and convincing. Where there is a conflict of evidence on relevant issues, I prefer the account of the Messrs Mond and Mr Janover.

798. I am satisfied that the meeting was not initiated by or on behalf of the plaintiffs. I am satisfied that at the meeting, Rabbi Berger outlined essentially the same proposal for settlement based on the relocation of Or Chadash which he had put to Rabbi Krasnjanski earlier that evening. I am satisfied that David Mond responded that Or Chadash was not a party to the arbitration and that he did not speak for it. I am satisfied that Rabbi Berger then stated that if the settlement proposal were not accepted, David Mond would be expelled or thrown out. I am satisfied that Barry Mond responded that should David Mond be expelled it would also be necessary to expel himself, Barry Mond, and his wife and children. I am also satisfied that Rabbi Katz then stated "You can't fight City Hall".

802. In my opinion, Rabbi Berger's statement that if David Mond did not agree to the proposed settlement relating to Or Chadash, he would expel him or throw him out, would cause a fair minded person knowing the relevant circumstances of the case reasonably to apprehend that Rabbi Berger had prejudged or might prejudge the case; and that he might not bring an impartial and unprejudiced mind to the resolution of the questions involved in it.

805. The plaintiffs contend that the version of the comment deposed to by Rabbi Berger also gives rise to a reasonable apprehension of bias. Given my conclusion on what was said, it is unnecessary to determine that question.

808. In my opinion, Rabbi Katz' statement that "you can't fight City Hall", stated after Rabbi Berger's comment, in the circumstances would create a reasonable apprehension or suspicion in a fair minded person that Rabbi Katz was also unable to approach the resolution of the case even-handedly and had prejudged it in favour of the fourth to twenty-fourth defendants, as representing an established authority or institution challenged by an isolated dissentient.

811. The fourth Broyde affidavit states that a borer may be partial during the hearing and in a mediation, although a borer is not an advocate and is, clearly, a dayan ("judge"). It does not define what particular species of conduct are comprehended by "partiality". It states that although a borer may be "partial" he must make an unbiased decision. That begs the question how (if bias as understood at common law were permitted throughout the hearing) a fair judgment could be assured. The distinction between the hearing and the judgment drawn by Professor Broyde is not sufficiently developed to assist the court. It raises, rather than resolves, questions.

814. Further, if under Halacha, a borer may legitimately during the course of the hearing threaten his appointor's opponent with a particular adverse outcome (which the arbitral tribunal may have no jurisdiction to order) unless the party agreed to a proposed settlement, it would be a major divergence from the concepts of fairness and natural justice as understood under common law, and hence, the Act. Such conduct would violate the fundamental principles of natural justice. A Victorian Court would not enforce, or would set aside, on the ground of public policy, an award produced in such circumstances.

817. I am far from persuaded that such conduct would accord with Halacha. Professor Broyde's evidence on the issue is general, vague and lacks clear definition of terms. It fails to comply with the requirements that all relevant assumed facts be stated and that the expert's reasoning process be exposed to permit curial scrutiny. The express terms of the Partial Award, which states that "each party is, and seen to be, treated alike" appear to exclude partial conduct. Rabbi Ulman's evidence also indicates that the fundamental rules of natural justice under Jewish law and procedure essentially accord with those of the common law.

821. Mr Hammond QC, on behalf of the fourth to twenty-fourth defendants, submitted that if a reasonable apprehension of bias were established, the plaintiffs had waived their entitlement to rely upon it due to their failure to make an application to the arbitral tribunal that the makers of the comments be disqualified.

824. It is not disputed that after their meeting with the dayanim on the evening of 31 October 2001 the plaintiffs and their legal representatives ceased to participate in the arbitration hearings, which recommenced on 1 November 2001 in their absence. There is no evidence before the court of the means, if any, whereby the plaintiffs gave formal notice of their withdrawal and the alleged grounds for it.

827. The defendants relied on R v Magistrates' Court at Lilydale; Ex parte Ciccone.[50] In that case, McInerney J. found that a magistrate's conduct in accepting transport to and from a view in a car with the respondents' barrister and witness constituted grounds on which reasonable people might conclude that the applicant might not receive a fair and unbiased hearing.[51] His Honour nevertheless held that the applicant had lost whatever right he had to have the decision quashed "by reason of the failure of his counsel to object to the magistrate's continuing to hear the matter".[52]

830. McInerney J. found that the applicant's counsel who (knowing of the right to object to the magistrate's continuing to hear the case) "did not in fact take any objection but proceeded to open his case, present his evidence as well as cross-examining the witnesses called for [the respondent] and make a final address to the magistrate".[53] Counsel "neither said nor did anything at the hearing to indicate that he had any objection to the magistrate's conduct in relation to the view or to the magistrate hearing the case on his return from the view".[54]

833. McInerney J. considered the competing rationales for the loss of a right to object on the ground of bias. On one view, it is justified by breach of a duty to take objection immediately in fairness to the magistrate and to the other party.[55] McInerney J. apparently rejected that view. On another view, loss of the right is based on the applicant knowing of the facts giving rise to the right to object but going on with the case down to judgment, or with knowledge of the facts, going on with the case "nursing a secret intention to save [the] objection for later if needed".[56] Ultimately, his Honour doubted whether "any one test should be regarded as the exclusive test".[57]

836. The crucial determinant in McInerney J's refusal of relief was the applicant's conduct (with knowledge of the facts entitling him to object to the continuance of the legal proceeding) in not objecting and in taking an active part in the proceedings right down to judgment. His Honour referred to cases[58] in which it was stated that a litigant who knows that there may be some objection to the constitution of the Bench is bound to mention it at once; but he was principally influenced by the fact that rather than objecting, the applicant in the case before him "instead ... went on, seeking to win on the evidence presented" [59].

839. McInerney J. concluded that even "if the evidence did not establish a case of 'lying by' or 'nursing a point' ...it would be wrong to allow the applicant - his advisers having chosen to go on with the hearing up to judgment, before the magistrate - to raise this point now. I do not think that they should be allowed thus to eat their cake and have it, to approbate and reprobate".[60]

842. In Hayden Merrett v The Director of Public Prosecutions and His Honour Judge Dyett,[61] on which the defendants also rely in this context, O'Bryan J. ultimately found that there was no reasonable apprehension of bias in the judge as alleged by the appellant. His Honour observed: "I find it curious indeed that experienced defence counsel did not request the learned Judge to disqualify himself before he delivered reasons for decision. If it was obviously clear ... that the learned Judge had pre-judged the appeals ... counsel could have politely asked him to stand aside".[62] He also noted that, as in R v Magistrates' Court at Lilydale[63], the applicant had waited until the judge delivered an adverse determination prior to making a complaint.

845. In Vakauta v Kelly[64] a party's counsel took no objection to a trial judge's comments (which the majority held to give rise to an appearance of bias) and made no application in relation to it. The matter proceeded to judgment in which similar comments were repeated. Dawson J. (dissenting on some issues) agreed with the majority that a party could waive a right to object by "standing by". He considered that waiver would occur where "no objection was taken to the continuation of the trial before His Honour, either formally or in effect...I do not mean to suggest that an objection will be waived if it is not made in formal or even explicit terms. The circumstances may be such that it is plain, without it being put into words, that a judge is being asked to consider his position having regard to the requirement of impartiality"[65].

848. In The Marriage of E.M. and G.T. Stiffle,[66] a trial judge in the course of a custody dispute hearing intervened and indicated in strong terms that the appellant wife had no real prospects of success in the proceeding. The trial was by affidavit. The wife's case was at that stage completed although cross-examination of the husband's witnesses was not complete. The wife's counsel did not make an application to the trial judge but the wife effectively withdrew from the case. Fogarty and Joske J.J. observed that in the exercise of the court's general supervisory jurisdiction, the ultimate determinant was whether a miscarriage of justice had occurred. In that context, they observed: "The failure of counsel to make an application to the trial judge to disqualify himself is an important consideration in the exercise of that power but we do not consider that it is necessarily fatal in every case, particularly when the trial did not proceed further after a judge's intervention which gave rise to the complaint"[67]. They concluded that in the circumstances, a retrial should be ordered.

851. In the present case, the plaintiffs made no objection or application after Rabbi Berger's hate mail comments, but continued with the hearing. David Mond then publicly indicated that he was not dissatisfied with the hearing he had received. If the matter had ended there, it could properly be concluded that the Messrs Mond had waived any right to object on the ground of apprehended bias. However, immediately following the comments which were made after the evening meeting with the dayanim on 31 October 2001, the plaintiffs abandoned the hearing. Their case was not closed, as Mr Weil had not completed his evidence (and subsequently did not return). The plaintiffs did not continue to present their case with a view to winning. Their counsel did not take objection or make an application to the arbitral tribunal in relation to the events of the meeting on 31 October 2001 and Rabbi Ulman was given until 6.00 pm on 1 November 2001 to negotiate a settlement. However, it cannot be said that they did not make their objection manifest, both by their complete withdrawal from the hearing, the comments made to Rabbi Ulman at the hotel meeting and Barry Mond's conversation with Rabbi Ulman on 1 November 2001.

854. The events complained of occurred during the evening of 31 October 2001. The arbitration hearing concluded before noon on 2 November 2001 and the Partial Award was also completed and signed on 2 November 2001.

857. While it is doubtless desirable that objection and a formal application in relation to apprehended bias be made as soon as possible, the failure to take such steps does not necessarily result in a waiver of the right to object. In the present case, the fact that the plaintiffs abandoned their participation in the hearing without making a formal objection or an application before the arbitral tribunal is not, in my view, a sufficient ground for depriving them of their right to rely upon an apprehension of bias, reasonably based, in order to set aside the Partial Award for misconduct.

861. In the present case the arbitration agreement stated that the parties:

"hereby agree to refer all the claims or counterclaims existing between either of Messrs Mond and the other named parties (the relevancy of which for this arbitration will be determined by the arbitrators): All for decision by [the arbitrators].

865. The language of the reference indicates that all existing claims and counterclaims between the named parties, without exception, are referred, and that all are referred for decision.

868. The meaning of the bracketed phrase "the relevancy of which for this arbitration" is obscure. It was contended for the fourth to twenty-fourth defendants that the inclusion of the phrase "the relevancy of which for the arbitration will be determined by the arbitrators" empowered the arbitrators to determine that some or all of the claims and counterclaims existing between the parties were not relevant and to refrain from deciding them.

871. The fourth to twenty-fourth defendants did not contend that the phrase had the effect of conferring upon the arbitrators a discretion to decide nothing at all, but submitted that although "core" issues must be decided, there was a discretion to omit to decide other issues.

874. If the phrase had the effect of conferring a discretion to decide nothing at all, it is questionable whether the arbitration agreement is an arbitration agreement within terms of s.4 of the Act which states that "`arbitration agreement' means an agreement in writing to refer present or future disputes to arbitration". As "arbitration" connotes "decision" or determination, an agreement which admitted the possibility that no dispute would be determined would not appear to be an "arbitration agreement".

877. Further, in the present case the arbitration agreement expressly states that the parties agree to refer all the claims or counterclaims existing between the parties ... All for decision" [emphasis added]. The phrase "the relevancy of which for this arbitration will be determined by the arbitrators" is redundant in the sense that the arbitrators, in deciding claims and counterclaims, must necessarily determine their relevancy for the arbitration. In my opinion, the phrase does not qualify the express reference of all claims and counterclaims existing between the parties "All for decision".

880. The reference is limited to claims and counterclaims existing at the date of the arbitration agreement.

883. The jurisdiction of the arbitrators flows from, and is delimited by, the agreement of the parties.

886. The present case is somewhat unusual in that the reference in the arbitration agreement of the existing claims and counterclaims fails to identify or define them in any detail.

889. The defendants sought to tender the draft arbitration agreements and related correspondence. The plaintiffs objected to their admission. In my opinion, the draft arbitration agreements are admissible to assist in the identification of the subject-matter of the arbitral reference. The draft arbitration agreements and correspondence indicate that the Messrs Mond resisted the fourth to twenty-fourth defendants' proposal to refer the Or Chadash issue for arbitration. As the parties could not agree on the specific issues for determination, the attempt to specify them broke down. The general description was ultimately adopted.

892. In a case where the reference is in general terms and no particular mode of notice of the particular claims within the reference is prescribed, informal notice of a claim by raising the issue orally at the hearing will suffice to identify it. However, unless the issue so raised falls within the ambit of the general reference, the arbitrators' jurisdiction will not extend to it. Conversely, if an issue is raised, albeit informally, and is within the reference, the arbitrators would be obliged to determine it.

895. Although there appears to be little specific authority on it, the proposition is illustrated by the early case of Ross v Boards,[68] in which the arbitration agreement provided that: "the settlement of all questions on an agreement existing between [the parties] be referred to the award of an arbitrator".

898. The "agreement" in Ross v Boards[69] was that the defendant should sell land to the plaintiff, with the title to be made out to the satisfaction of the plaintiff's attorney.

901. The plaintiff contended that one of the matters in dispute was whether the defendant could make out good title to the land in question. The defendant contended that although there was a question of identity of the land, there was no real question of title.

904. For the plaintiff it was contended that "the order of reference empowered [the arbitrator] to decide certain matters in dispute, not generally to direct what should be done between the parties. The matters brought before him as the subject of dispute were, whether the defendant could make good title, and whether the title as shown on the abstracts, was such as [the attorney] ought to have approved. Instead of determining these points, he has made an order which shows that he doubted whether or not the title was one which [the attorney] ought to have approved. This deviation from the line prescribed to the arbitrator vitiates the award ..."

907. Lord Denman C.J. stated that "The objection insisted upon must prevail. The agreement between these parties was, that the defendant should sell the land to the plaintiff, the title to be made out to the satisfaction of [the attorney]. It was referred to the arbitrator to settle all questions between the parties, on the agreement. He does not decide the questions arising on the agreement, but awards [a conveyance of doubtful title with an indemnity] ... The award is not final because, instead of deciding the questions referred, it sets on foot new ones ... "[70]

910. Patterson J. observed that it was an agreement to take good title and "a reference is made of all questions on the agreement. Upon the arbitration, a question is raised on the sufficiency of the title. If no such point had arisen, the case would have been different. Then the arbitrator awards not that the title is good or bad, but that there shall be a conveyance of the title, and a bond executed. The award, therefore, is bad. The arbitrator was not empowered to order what should be done between the parties" [emphasis added].

913. Or Chadash was an issue which the fourth to twenty-fourth defendants clearly and repeatedly raised, and sought the arbitrators to determine. Although the Messrs Mond resisted the determination of the Or Chadash issue, as it was raised, if it constituted "a claim or counterclaim between either of Messrs Mond and the other named parties" to the arbitration agreement, then it would be within the reference.

916. I do not consider that the relationship between Or Chadash and CHC or the other defendants was "a claim or counterclaim between either of the Messrs Mond and the other named parties to the arbitration agreement".

919. "Or Chadash" is merely a label for a fluctuating group of persons. It lacks separate legal personality. As such it is not, and could not be, a party to the arbitration agreement. There is no evidence of the identity of all persons who are or were members of, or affiliated with, Or Chadash. On the assumption that each person "belonging" (in a neutral sense) to Or Chadash was also a member of CHC, each would have a bundle of diverse statutory and contractual rights against, and liabilities to, CHC, pursuant to s.14A of the Associations Incorporation Act, seat occupation, seat rental and other circumstances.

922. While the various rights against, and relationship to CHC of an indeterminate group of persons collectively known as Or Chadash was a matter on which the plaintiffs and the other parties to the arbitration agreement disagreed, that circumstance does not constitute it a "claim or counterclaim existing between" those parties within terms of the arbitration agreement. Nor do I consider that the plaintiffs acquiesced in an extension of the reference.

925. The mutual rights, obligations and entitlements existing between each of a fluctuating sub-group of members of a corporation on the one hand, and that corporation on the other, does not constitute, and cannot validly be described as, a claim or counterclaim existing between the corporation and David Mond, a single member of the corporation affiliated with the sub-group. A decision of the arbitrators on such issues would not be limited to CHC's "counterclaims" against the Messrs Mond, or the Messrs Monds' claims against CHC. Further, the decision could not bind any members who were not parties to the arbitration agreement. A purported determination pursuant to an arbitration agreement to which only one or some members were party, would be a futility. Similarly, Rabbi Krasnjanski's rights and entitlements against CHC could not be affected by an award made pursuant to an arbitration agreement to which he was not a party.

928. It follows that the Or Chadash issue was not within the arbitral reference. The arbitrators had no jurisdiction to determine it. Their determination and findings in relation to Or Chadash constitute "misconduct of the proceedings" within terms of s.42 of the Act, in that they made an award partly in respect of a matter not referred to arbitration pursuant to an arbitration agreement governed by the Act.

931. The parties agreed that the "claims or counterclaims existing between either of Messrs Mond and the other named parties" would be determined by the dayanim acting as arbitrators according to Jewish law and rules of procedure established and customarily employed in reference to arbitration before a Beth Din. Professor Broyde deposed that under Halacha, the arbitrators would derive jurisdiction from the fact that "evidence is led or submissions are made in a Din Torah in relation to an issue even if that issue is not expressly referred to in the arbitration agreement executed by the parties ... ".

"As a matter of Halacha, if there was evidence about an issue between the same parties in the Din Torah, the dayanim have jurisdiction to resolve that other issue, notwithstanding that such issue was not expressly referred to in the arbitration agreement.

38(a) I have assumed that Rabbi Krasnjanski gave a hetter to the first-named plaintiff on 15 September 2000.

(b) As a matter of Halacha in giving a hetter to a member of one part of a congregation, that raises the relationship between the various constituent parts of that congregation as an issue between the parties".

940. My reservations about the evidence of Professor Broyde are set out in detail above. The meaning of paragraph 38(b) of his affidavit is obscure. It is question-begging, and lacks any precision or definition of terms. It appears to be directed at establishing that under Halacha, the Or Chadash relationship would constitute a claim between Mr Mond and the other parties to the arbitration agreement because Mr David Mond obtained a hetter. I do not accept that it does establish that proposition.

943. Professor Broyde's affidavit does not define what is meant by a "member", "various constituent parts of a congregation" or "a congregation". It is not clear what is meant by "the parties". It falls far short of establishing that under Halacha, the rights of certain individual members of an incorporated congregation who are affiliated with a faction or subgroup which lacks a separate legal personality, can validly fall within the reference of an arbitration agreement executed by, on the one part, a single member affiliated with the faction, and on the other part, the incorporated congregation, so as to become binding and enforceable on all persons who may be affiliated with the "group", although they are not party to the agreement.

946. Whatever the position under Halacha, Victorian law governs the arbitration agreement and the construction of the terms of its reference. The parties' selection of Jewish law and procedure to determine the issues in dispute does not apply to the definition of those issues in the arbitration agreement and cannot expand the jurisdiction of the arbitrators pursuant to the Act.

950. In the present case the award is entitled a "Partial Award".

"This Award does not address all the issues between the parties, hence its heading Partial Award. The issues left over are:

3. Any issues connected with or arising out of this Award, particularly the above-mentioned proposal for settlement with Or Chadash."

960. Mr Hammond QC, on behalf of the fourth to twenty-fourth defendants, contended that the plaintiffs' complaints were premature and ill-founded, because the Partial Award did not purport to deal finally or conclusively with any of the matters referred for decision. Rather, he submitted that the findings or determinations were "interlocutory" in nature. Mr Hammond QC further contended that the arbitration was part heard. The plaintiffs had interrupted the arbitration and bore the onus of showing that the "dayanim should not be permitted to continue this arbitration to finality".

963. According to Mr Hammond QC, the Partial Award contemplated that the parties were entitled to challenge any particular determination or finding before the arbitrators. The Partial Award, in essence, invited the parties to "come back". He submitted that the parties could object to a particular finding and a re-hearing would follow. The dayanim would then determine whether they had already finally determined the issue in question. Only at the stage when the dayanim determined that they had finally decided the relevant point would the parties be entitled to seek a remedy in the courts.

966. Mr Hammond QC conceded that the validity of the Partial Award as an award for the purposes of the Commercial Arbitration Act was not in issue. However, he contended that it was "on any view a part heard arbitration".

969. As I understand it, the fourth to twenty-fourth defendants' position was that the Partial Award was both partial and interlocutory. None of the findings or determinations was final. All could potentially be altered. The arbitrators could revisit issues of their own volition or the parties could challenge findings. The dayanim themselves were the sole arbiters of disputes as to the meaning of the Partial Award.

972. If the Partial Award could properly be viewed as a draft, provisional or merely interlocutory, it would be immune from legitimate challenge on the bases that it failed to deal completely with the subject-matter of the reference, dealt with matters not legitimately within the reference or dealt improperly or inadequately with any subject matter of the reference. Similarly, to the extent to which the Partial Award dealt with only some of the matters referred to the arbitrators, even if it were not merely provisional, as an award which expressly purported to deal with only some issues, it could not be challenged on the basis that it did not deal with the remaining issues referred for decision

975. If, on the other hand, the Partial Award is final in relation to all matters save for some specified issues which are left over, it would be subject to challenge on the usual grounds in relation to those matters which it determined. Further, it would be necessary to establish that the issues "left over" were validly within the reference and that the arbitrators were empowered to deal with the reference in stages.

978. In the present case the fourth to twenty-fourth defendants rely on the express reservation in the Partial Award as a matter "left over" of "any issue connected with or arising out of this Award" to contend that the entire Partial Award is provisional.

981. It is necessary to consider in this context the meaning of the terms "award", "interim award", "partial award" and "provisional award".

984. Section 4 of the Act provides that, unless inconsistent with the context or subject matter, "award" means "final or interim award".

"Unless a contrary intention is expressed in the arbitration agreement, the arbitrator or umpire may make an interim award."

"Unless a contrary intention is expressed in the arbitration agreement, the award made by the arbitrator or umpire shall, subject to this Act, be final and binding on the parties to the agreement."

995. Neither "award" nor "interim award" is further defined. The terms "partial award" and "provisional award" are not referred to in the Act.

998. Mustill and Boyd[71] recognise the persistent failure of national and international arbitration legislation to define precisely the central concepts of "award" and "arbitration". They note that "this makes it surprising how rarely it has been asked what are the distinguishing features of an award, the aim and pivot of the entire process. Perhaps it has simply been assumed that however one may define an award, it is easy to recognise one when one sees it[72]."

"The reason why a document embodying a decision (using the word in a neutral sense) by an arbitral tribunal is properly described as an "award" or something else may be of practical importance because an accurate classification may determine -

1. Whether the decision is enforceable by a domestic or foreign court.

2. Whether the decision is susceptible of appeal or other intervention by a court, and if so by what means.

3. Whether the decision is binding on (a) the parties and (b) the tribunal.

4. As regards the latter, the categorisation of the decision may determine whether and to what extent the tribunal can validly recall or vary its decision."[73]

1009. Mustill and Boyd, in the absence of any legislative definition, "suggest two characteristics which we believe would be accepted as indicia of an award by the arbitrating community at large:

1. An award is the discharge, either in whole or in part, of the mandate entrusted to the tribunal by the parties, namely to decide the dispute which the parties have referred to them. That is, the award is concerned to resolve the substance of the dispute. Important aspects of the arbitrator's duties are naturally concerned with the processes which lead up to the making of the awards, and they are empowered to arrive at decisions which enable those processes to be performed. The exercise of those powers are, however, antecedent to the performance of the mandate, not part of the ultimate performance itself. Thus, procedural decisions, and the documents in which they may be embodied, are not `awards'.

2. Constituting as it does the discharge of the arbitrator's mandate the award has two effects:

(a) Since the parties have, by their agreement to arbitrate, promised to be bound by the arbitrators' decision of their dispute, they are for all purposes bound by it themselves, although others are not so bound ...

(b) Since the making of the award constitutes a complete performance of the mandate entrusted to the arbitrators, it leaves them with no powers left to exercise: except of course, in the case of a partial award, when the exhaustion of the arbitrators' powers is complete as to part and incomplete as to the remainder.

So much is, we believe, generally accepted."[74]

1017. Redfern and Hunter[75] recognise that in English contexts, the terms "interim" and "partial" are sometimes used interchangeably. In civil law countries, a "partial award" may refer to an award which is a decision on part of the dispute which is binding, enforceable, and disposes of the issues with which it deals. An "interim award", in contrast, may commonly deal with classically "preliminary" issues. Both interim and partial awards, however, are distinguished from interlocutory awards, which, as decisions of the arbitrator on procedural issues, are not enforceable as final awards[76].

1020. Redfern and Hunter, recognise the definitional problem, noting that "[t]here is no internationally accepted definition of the term `award'."[77] They also recognise that the search for a satisfactory definition is complicated by the need to distinguish between awards that are final and those that are not.

1023. They conclude "In practice the term 'award' should be reserved for decisions that finally determine the substantive issues with which they deal. This involves distinguishing between awards (which are concerned with issues) and procedural orders and directions (which are concerned with the conduct of the arbitration)". [78]

1026. Further, they observe that "Some commentators have suggested that a preliminary award may be treated as `provisional'. However, this concept seems to be fraught with perils; the authors suggest that any decision that is not finally determinative of the issues with which it deals should not be called an `award'."[79]

1029. Mustill and Boyd, in their discussion of the English Arbitration Act 1996 (which is acknowledged to be `a striking innovation')[80] observe that under the new English legislation there are now three types of award - a final award, a partial award and a provisional award. The learned authors also doubt whether "provisional awards", although termed "awards", are "awards" at all, as they do not satisfy the fundamental statutory requirement that awards be final and binding.

1032. The distinction between interim awards and interlocutory awards has been considered in a number of Australian decisions. It has been consistently recognised that interlocutory procedural orders or rulings do not constitute an award.

1035. In Command v Fletcher[81] Mandie J held that an arbitrator's direction that certain arbitrations be consolidated was an interlocutory procedural order and not an interim award.

1038. In Doran Constructions Pty Ltd v Health Administration Corporation of New South Wales[82] Rolfe J. held that a document setting out interlocutory procedural directions was not an award at all. The document in question was entitled an "award" and the parties (and the arbitrator) had accepted its status as such. It had first been published as a draft interim award. The document determined the issue of whether the plaintiff could raise a rectification point and the respondent could raise defences. It provided a time table for a statement of issues.[83]

1041. Rolfe J. found that although entitled an "award", and believed to constitute an award, it "did not decide a matter remitted to the arbitrator in the sense of a matter remitted for his final determination".[84]

1044. Rolfe J. held that, on analysis, in permitting the plaintiff to raise the claim of rectification subject to defences, the Arbitrator exercised discretion in respect of a matter of procedure over which he had control."[85] The arbitrator was entitled to reconsider such interlocutory decisions on procedure in the course of the arbitration and his decision would not be subject to review by the Court.[86]

1047. His Honour concluded that the relevant document was not an award but a decision as to procedural matters.[87]

1050. He relied on Resort Condominiums International Inc v Bolwell & Anor[88] in which Lee J determined that orders which were of a procedural nature pending the hearing of the arbitration did not constitute a final award. Lee J. noted that the orders in question were "clearly of an interlocutory and procedural nature and in no way purport to finally resolve the disputes or any of them referred...for decision or to finally resolve the legal rights of the parties. They are provisional only and liable to be rescinded, suspended, varied or reopened by the tribunal which pronounced them."[89]

1053. Rolfe J. also endorsed the approach of Steyn J. in Three Valleys Water Committee v Binnie & Parners (A Firm)[90].

1056. In the present case, the Partial Award does not deal with procedural matters comparable to those in the above cases.

1059. The criteria to be applied in distinguishing an award from a provisional or preliminary report, which could validly be reconsidered by the arbitrator, were considered in In the Matter of an Arbitration between Kennedy-Taylor (Qld) Pty Ltd v Civil and Civic Pty Ltd.[91] McPherson J.A. and Cullinane J. there considered, inter alia, the status of an arbitrator's decision, described as an "interim award", on certain preliminary points.

1062. During the preliminary hearing, the arbitrator had assured the parties' advocates that following publication of the interim award, there would be a final hearing at which the parties would have an opportunity to challenge the award and call evidence before it was finally adopted".[92]

1065. Despite those assurances, the arbitrator initially contended that the 'interim award' was "not a preliminary report which either party was free to challenge at a further hearing".[93] The arbitrator subsequently relented and offered the opportunity to challenge the correctness of the interim award and to make submissions that it should not be confirmed as a final award.[94] The contemplated further hearing never occurred because it was intercepted by the plaintiffs' application to set aside the award.[95]

1068. McPherson J.A. and Cullinane J. observed that the attitude of the parties to the status of the award had fluctuated according to tactical advantage. Given their inconsistency, "the only safe guide to what was really intended in making the award is to be found in what the arbitrator said and did".[96]

1071. In relation to the relevant section of the Arbitration Act 1973 (Qld) their Honours observed:

"The section does not specify the form that such an award is to take, or its effect when made, beyond saying that a reference in the Act to an award includes an interim award. Texts and decided cases suggest that a purpose for which interim awards may be made is to resolve a distinct question or issue in an arbitration as a preliminary to deciding the whole matter under reference."[97]

1075. They referred to Fidelitas Shipping Co Ltd v V/O Exportchleb[98] as authority for the proposition that "an interim award may have the effect of determining issues of fact or law conclusively as between the parties, so as to create an issue estoppel capable of preventing either of them from subsequently raising a point which could have been, but was not, litigated in the proceedings leading to the award. It does not follow that the arbitrator is necessarily precluded from reconsidering an interim award he has made. Statute apart, such a rule admittedly prevails in the case of a final award"[99].

1078. The observation of McPherson J.A. and Cullinane J. that an arbitrator is not necessarily precluded from reconsidering an interim award he has made is, in my opinion, true pursuant to the Act only where, as contemplated in s.28, the requirement that the award be final and binding is displaced or modified by the arbitration agreement or a provision of the Act.

1081. In Kennedy-Taylor[100] McPherson J.A. and Cullinane J. concluded that, in circumstances where the "arbitrator evinced a clear intention to afford the parties an opportunity of challenging...any findings and conclusions he might reach" in the interim award, and afforded that opportunity in unqualified terms after its publication, it was not beyond his power to reconsider it as he had promised he would.[101] Although "the interim award...did not, as in the Fidelitas case, expressly claim to reserve it for his reconsideration, or request that it be remitted to him for that purpose; the course of the proceedings showed it was his intention to do so".[102]

1084. In the present case, the arbitration agreement does not express any intention which displaces or modifies the requirement that the award (whether interim or otherwise) be final and binding. The arbitration agreement states: "We submit to the exclusive jurisdiction of the said arbitrators and accept that their decision shall be final and binding on all parties and enforceable under the relevant Commercial Arbitration Act of Victoria".

1087. The arbitration agreement expressly empowers the arbitrators to make "both inter parties and ex parte orders as well as orders as to costs". It does not expressly empower the arbitrators to make provisional or draft awards. It does not provide any mechanism, procedure or time limits for the making of further submissions or revisiting any provisional or interlocutory findings or determinations.

1090. It may be contended that the arbitration agreement implicitly authorises the making of a provisional award because it provides that the arbitrators must determine the dispute "acting according to Jewish law and rules of procedure established for and customarily employed in references to arbitration before a Beth Din, a Jewish Court of Law". Professor Broyde (the fourth to twenty-fourth defendants' expert witness) states in paragraph 39(b) of his fourth affidavit:

"As a matter of Halacha, issues raised as set out in paragraphs 37 and 38 herein may be addressed in a partial or final award. The use of partial awards is recent in the Jewish legal tradition, but has become not uncommon in practice. As an expert who sits on many such rabbinical courts, I can say that such partial awards are valid in Halacha, even though I cannot cite an exact source noting that."

1094. I have already noted my reservations in relation to Professor Broyde's evidence. In the present instance, the deponent does not define what he means by a "partial award" and how it differs from a final award, interim award, interlocutory award or provisional award. Even if otherwise unobjectionable, his evidence on that issue is too general to be meaningful in a context where many different usages of the relevant terms apply. There is no basis for concluding that the parties' agreement that the arbitrators act according to Jewish law and the rules of procedure for arbitration before a Beth Din displaces the requirement that the award (whether final, interim or partial) be other than final and binding.

1097. The view that only final and binding determinations constitute valid awards has conceptual coherence and consistency. However, the Victorian legislation contemplates an "award" which is not final and binding where the arbitration agreement has indicated a contrary intention. Therefore, in my opinion, provisional awards, whether interim or not, are permissible under the Act where the parties' agreement so provides.

1100. The following principles may be distilled from the relevant statutory provisions, authorities and commentary:

1. Under the Act, an award, whether interim or otherwise, must generally be final in the sense that it disposes conclusively of the referred issues dealt with, consequently rendering them res judicata and the arbitrator functus officio. 2. An interim award, although not statutorily defined, refers to an award which deals with only some of the referred issues. It must deal with those issues finally. The outstanding issues within the reference must be dealt with in a further award. 3. Under the Act, an interim award may be made, unless the arbitration agreement expresses a contrary intention. 4. A "partial" award is not recognised in the Act. The term does not appear to be commonly employed in Australia. Internationally, the term is frequently, but not exclusively, used interchangeably with "interim award". The term "partial award" has been preferred to the traditional "interim award" in recent English legislation, apparently because it avoids the misleading connotation that such an award need not be final. Some suggested usages distinguish between "partial" and "interim awards", but it is generally recognised that both partial and interim awards must finally determine the issues dealt with. 5. Interlocutory orders, dealing not with substantive issues within the reference but with procedural matters, are not awards. 6. A provisional determination designated an "award" may be made under the Act if the arbitration agreement negates the usual requirement that the award be final and binding. The anomalies associated with the recent English statutory recognition of "provisional awards" apply, because the fundamental classical characteristics of an "award" are absent.

1104. In the present case, there is no evidence that following the execution of the arbitration agreement, the parties at any stage authorised, agreed to or acquiesced in the publication of a provisional award. There is no evidence that the arbitrators, at any stage prior to the publication of the Partial Award, represented to the parties that they proposed to publish a provisional award, or offered the opportunity to make further submissions and to convene further hearings, or that the parties desired or consented to such a course.

1107. Therefore, if the Partial Award were merely provisional, it fails to comply with the fundamental statutory requirement of finality, without the agreement of the parties.

1110. However, in my opinion the Partial Award is not provisional. Rather, it is, on analysis, a final award which identifies itself as "partial" only in the usual sense of "incomplete". No issues legitimately within the arbitral reference are identified as outstanding. Rather, the matters identified as "left over" are uncertain. They are incidental or consequential to matters already dealt with, which will not necessarily arise and do not have to be addressed in order to complete the arbitral reference.

1113. The Partial Award refers to the possible recall of Rabbi Abraham. It states that the arbitrators had offered to arrange for him to testify in England but "Nonetheless we feel confident to proceed to issue this partial award". There is no suggestion that Rabbi Abraham's possible recall could modify the determinations already made in relation to him. Similarly, the Partial Award refers to "any issues that may be raised by Mr Paluch". The Partial Award assumes the legitimacy of its determination appointing Mr Paluch. Only Mr Paluch himself may raise issues.

1116. The relevant paragraph does not indicate that the Partial Award is fluid and that all or any of its conclusions, findings or decisions are potentially revocable. The Partial Award does not state that the parties may make objections to, or submissions on, its findings. It does not provide a procedure for the making of further submissions or challenges to its correctness. It does not state that any or all of its findings and determinations are merely provisional and should not be regarded as binding or enforceable until after a further specified process or effluxion of time. It does not provide for further hearings. Rather, the Partial Award expresses its findings and determinations as final and does not contemplate their subsequent modification, revision, or alteration by a further process. It provides that possible future matters may be determined by an unspecified process in an indefinite time frame.

1119. The Partial Award states that its rules of procedure were intended to ensure that

"(iv) Unless otherwise agreed, the hearing is the only occasion on which the parties present the whole of their argument and evidence."

1123. There is no evidence of any agreement that there would or could be further hearings. The above statement is inconsistent with the submission that the arbitration was part-heard. It fortifies my conclusion that the existing determinations, conclusions and findings contained in the Partial Award were, and were understood to be, final and binding.

1126. It is established that an arbitrator may not reserve a power to deal with future disputes arising on the award. In Manser v Heaver[103] an arbitrator made an award giving a verdict for the plaintiff mill-owner and ordering the defendants to restore the mill's stream bed. The award recognised that the arbitrator could not determine the cause of all obstructions in the stream until the defendant's restoration had been completed, and that disputes might subsequently arise. The award stated that if after the restoration of the stream the plaintiff remained unsatisfied, the plaintiff was at liberty on giving notice to the defendants, to bring evidence that the cleansing of the stream bed had been unsatisfactory and the defendants could produce evidence to the contrary "in order that a final award may be made concerning all matters in difference between the parties". If no proceeding took place within a specified time, the award was to be final and conclusive.

1129. Lord Tenterden C.J. stated: "By the award [the arbitrator] first directs what shall be done by the parties and then reserves himself a power of examining into the manner in which his direction shall have been followed. That he could not do...[104]"

1132. Further, awards must not contain unauthorised directions to the parties. In Price v Popkin[105] a landlord and tenant referred to arbitration a dispute over whether certain items were fixtures and hence part of the demised premises. The award determined that certain of the relevant items were part of the demised premises but had been removed by the tenant, who was ordered to pay damages. The landlord was ordered to replace the items, but the award did not specify what they were or the quality of the replacements. Denman C.J. stated that "this award is bad. The arbitrator had no authority to order anything to be done with respect to the fixtures; and if he had such authority, he has given his directions in too uncertain a manner. The award must be set aside, not as to part only, but as to the whole"[106].

1135. The problematic final paragraph of the Partial Award conflates partiality and provisionality. It is inconsistent with the fundamental requirements of finality and jurisdiction. The reservation of an ambulatory supervisory role for an indefinite term, in an imprecisely defined range of future matters, misconceives the legitimate function and jurisdiction of the arbitrators.

1138. The last paragraph, in my opinion, rather than reserving any outstanding matters properly within the arbitral reference or qualifying the findings of the Partial Award as merely provisional, constitutes a purported reservation by the arbitrators of authority to determine future disputes or matters which might arise out of the Partial Award.

1141. Where there is no indication from the arbitration agreement, the circumstances of the hearing, the conduct of the parties or the terms of the award itself that its findings are, or may be subject to challenge or revision, and the only matters designated as "left over" are uncertain future matters not validly within the arbitral reference, the award must be treated as final. The ambiguity or incompleteness of an award, or an unauthorised arrogation of a future arbitral role, cannot exclude curial intervention on the ground that the award is merely provisional or "partial".

1144. It follows that the Partial Award is a final award, which in so far as it is partial, identifies no legitimate outstanding matters as left over. It is therefore subject to challenge on the usual bases.

1148. In the present case the plaintiffs complain that the Partial Award's appointment of Mr Paluch constitutes misconduct on two distinct but related bases. First, the arbitrators breached the duty to determine an essential issue referred for decision. Secondly, they improperly delegated their arbitral authority to a third party. The Partial Award's appointment of Mr Paluch and its specification of his role constitutes the foundation for both complaints.

1151. It is well established that the delegation of the arbitrator's decision-making power constitutes misconduct. In Tomlin v Fordwich Corporation[107] a landlord and tenant referred all questions and differences between them in relation to a renewal of the lease to arbitrators whose award included the determination that the landlord should, within a certain time, put the leased premises in good order to the satisfaction of a named third party. The court held that the delegation of the power of the arbitrators to the third party was an "insuperable objection" and the award was clearly bad. Littledale J. stated: "the arbitrators could confer no power on a third party"[108]. In contrast, the delegation of a ministerial function or a mechanical task is permissible[109].

1154. Similarly, it is a breach of duty if the arbitrator fails to determine the disputes or questions referred to arbitration[110]. It is not disputed that in the present case, the eligibility for membership of CHC was referred to the arbitrators for decision.

"MEMBERSHIP ISSUES The Dayanim find that the current system of recording members is flawed and does not comply with the provision of [sic] constitution. At the same time there is no evidence of real prejudice. We record the agreement of CHC to appoint Mr A Paluch of Guests Accounting, certified practising accountants of 234 Balaclava Rd Caulfield North to supervise the compilation of a new Register of Members in compliance with the Constitution and the Act and to supervise the preparation and conduct of the next AGM. He should look to the Daynim [sic] to enforce his decision if necessary..."

1161. At trial during cross examination, Rabbi Berger testified for the first time that the Partial Award's apparently absolute delegation of its decision - making power on the question of eligibility to Mr Paluch was a mistake.

1164. The defendants' case did not include any previous contention that the Partial Award's treatment of Mr Paluch's role was mistaken. Neither Rabbi Berger nor Rabbi Ulman referred to a mistake in their affidavits, which purported to cover comprehensively the issues relevant to the case. The alleged mistake was not put to Rabbi Ulman who was not cross-examined on it. Rabbi Berger did not refer to it in his examination in chief.

1167. Rather, in cross-examination, Rabbi Berger stated he had intended to select a person who could act as a `gofer' to do the leg work of compiling a financial list of contributors to CHC. (By the term `gofer' Rabbi Berger sought to indicate a person who would perform only mechanical tasks which did not involve the exercise of judgment).

1170. He testified that on 31 October 2001, he requested Mr Romer (the solicitor of the fourth to twenty-fourth defendants) and Mr Heimann (a defendant) to nominate a suitable person to supervise the compilation of a new register of members in compliance with the CHC constitution and the Act. Mr Romer gave evidence that the relevant conversation occurred at about 11.30am on 31 October 2001. According to Mr Romer, it was not a private conversation with Rabbi Berger in his capacity as CHC's borer. Rather, Rabbi Berger stated that `the dayanim' required a nominee.

1173. Rabbi Berger testified that Messrs Romer and Heimann said that they would get back to him. No one contacted the Messrs Mond or their legal representatives to inform them of the proposal at that stage. On 1 November 2001, Mr Heimann suggested the name of Mr Paluch. Rabbi Berger testified that only on 1 November 2001 did he ask Rabbi Ulman (at that stage purportedly dismissed by the Monds as their borer) to get his appointors either to consent to Mr Paluch's nomination or to nominate someone else. Rabbi Ulman did not get back to Rabbi Berger with any other name. Rabbi Berger stated that when typing the Partial Award, he therefore inserted the name of Mr Paluch. Rabbi Ulman's recollection of those events was vague.

1176. At trial Rabbi Berger conceded that Mr Paluch's proposed role in compiling the register of members and subsequently supervising the annual general meeting to which that register was a necessary prerequisite, was more than "just an accountant drawing up a list". However, he maintained that Mr Paluch's role was nevertheless merely administrative, because the dayanim intended him to "come back" to them so that they could scrutinise his work and hold a further hearing. The register would be shown to all relevant parties and submissions would be sought.

1179. The Partial Award states that Mr Paluch should "look to the dayanim to enforce his decision if necessary" which is clearly inconsistent with Rabbi Berger's evidence on the intended role of Mr Paluch. When cross-examined on that issue, Rabbi Berger stated: "I was waiting for that...it's a patent error on the face of the award". He stated that if the proceedings had been in England, he would have applied to correct the error under the slip rule.

1182. Rabbi Berger's evidence that he was seeking a mere "gofer" to draw up a list and that the Partial Award contained a mistake is not corroborated by the other dayanim. Further, whatever Rabbi Berger's intention, there is no admissible evidence, other than for the terms of the Partial Award, of what the other dayanim decided and intended. The contention that Mr Paluch's function was merely ministerial is inconsistent with the plain words of the Partial Award. In the circumstances, I do not accept that the Partial Award's treatment of Mr Paluch's role is a mistake which does not express the decision of the dayanim.

1185. Further, if the relevant statement in the Partial Award were a mistake made due to pressure of time in typing the Partial Award (which while dated and signed on 2 November 2001 was not published until 16 November 2001) there is no explanation of why the matter was not raised prior to Rabbi Berger's cross-examination at trial. There is no evidence that any acknowledgement of a mistake, or any application to correct it, was made at any stage of the arbitration process or this proceeding.

1188. The Partial Award, on a plain reading, indicates that the arbitrators determined that "the current system of recording members [of CHC] is flawed and does not comply with the constitution". However, the arbitrators did not determine the more fundamental issue of eligibility for membership referred to them for decision. Rather, they delegated their decision-making power to Mr Paluch. The Partial Award indicates that Mr Paluch was appointed "to supervise the compilation of a new Register of Members", and to make determinations as to the identity of the members included in the register. This necessarily depended upon his resolution of the competing bases of eligibility.

1191. The Partial Award does not determine the basis on which persons would be entitled to inclusion in the Register of Members. It gives no indication that there would be any further input by the arbitrators to the determination or settlement of the Register of Members, unless Mr Paluch himself requested it.

1194. The only possible future functions contemplated for the arbitrators are those of enforcement or responding to Mr Paluch's enquiries. The Partial Award states that Mr Paluch "should look to the Dayanim to enforce his decisions if necessary".

1197. The impression that Mr Paluch is constituted the final arbiter of membership status is fortified by the final paragraph of the Partial Award which identifies as a "left over" matter: "Any issues that may be raised by Mr Paluch". There is no recognition that any other persons were entitled to "raise issues" about Mr Paluch's role or to challenge the Register of Members he compiled.

1200. I am satisfied that the arbitrators' appointment of Mr Paluch to determine the identity of the persons included in the Register of Members and, by necessary implication, the basis of their eligibility for inclusion, constituted an improper delegation of their arbitral power. Further, by reason of such delegation, the arbitrators necessarily failed to decide a central claim the subject of the reference. The delegation, in my opinion, constitutes misconduct within terms of s.42 of the Act.

1203. It is therefore unnecessary to determine whether the solicitation of a nominee to prepare a Register of Members from CHC's representatives only (without simultaneously notifying the Messrs Mond or soliciting a like nomination from them) was permissible under the procedure customary for an arbitration before a Beth Din or, if so, whether such conduct would constitute a fundamental breach of the rules of natural justice at common law.

1207. The Partial Award is a final, rather than a provisional award. Although it purports to reserve some matters for possible future determination or enforcement, the reservation is ineffective.

1210. Rabbi Berger's comments in relation to hate mail would, in my opinion, give rise to an apprehension of bias in a fair-minded observer with the knowledge of the objective facts. David Mond waived his right to object to those comments by his failure to object or to make an application to the arbitral tribunal, together with his continued participation in the arbitration.

1213. Rabbi Berger's comments at the meeting on 31 October 2001 would, in my opinion, give rise to an apprehension of bias in a fair-minded observer with knowledge of the objective facts. Rabbi Katz' comments at the meeting on 31 October 2001 would also give rise to a reasonable apprehension of bias. The plaintiff's entitlement to object on the basis of comments made at the meeting was not waived. Misconduct within terms of s. 42 of the Act by Rabbi Berger and Rabbi Katz is established.

1216. Although misconduct is not established in relation to the arbitral tribunal's response to the departure of Rabbi Abraham, nor in relation to the treatment of the matter in the Partial Award, the relevant terms of the Partial Award constitute a misstatement which, when viewed in context with the other circumstances of the case, contributes to a reasonable suspicion of a lack of partiality and is part of an associated trend or pattern.

1219. The position of Or Chadash and of Rabbi Krasnjanski were not matters within the arbitral reference and hence, were not within the jurisdiction of the arbitrators. The inclusion of Or Chadash as subject matter of the Partial Award, in my opinion, constituted "misconduct of the proceeding" within terms of s. 42 of the Act.

1222. The appointment and role of Mr Paluch pursuant to the Partial Award constituted a delegation of the arbitrators' power and is thus misconduct within terms of s. 42 of the Act. The associated failure of the arbitrators to determine the issue of eligibility for membership of CHC, referred for decision, also constitutes misconduct within terms of s. 42 of the Act.

1225. It follows that misconduct within terms of s. 42 of the Act is established on a number of distinct bases. In my opinion, the Partial Award should be set aside.

Admitted items: 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 22, 23, 24 and 25 as relevant to the identification of the claims and counterclaims, the Or Chadash issue and the availability of Rabbi Abraham.

Items: 36, 37, 39, 40 and 41 dealing with Mr Paluch's activities in 2002 were not in my view relevant to determination of misconduct in relation to the Partial Award and hence not admitted.

Admitted paragraphs: 4, 6, 7-9, 12, 13, 14, 16-30, 39 as background.

[1] Garms v Telstra Corporation Ltd [1998] V.S.C. 40 (21 August 1998).

[3] Mustill & Boyde observe that it is not clearly established whether exceeding jurisdiction is an instance of misconduct or whether it constitutes a separate ground for relief, in that want of jurisdiction renders an award void: Mustill, L & Boyd S, Commercial Arbitration, (2nd ed), London, 1989 at 554. Also see: Buckley v Board of Land and Works [1893] VicLawRp 84; (1893) 19 V.L.R. 522, where the question was considered but not determined.

[4] [1958] 1 W.L.R. 271.

[6] [1914] 2 K.B. 478.

[9] [1994] HCA 30; (1993-1994) 181 C.L.R. 41.

[11] R v Sussex Justices, Ex parte McCarthy [1924] 1 K.B. 256, at p.259, per Lord Hewart CJ; Re JRL, Ex parte CJL (1986) 161 C.L.R. at pp.351-352.

[12] [1983] HCA 17; (1983) 151 C.L.R. 288.

[14] [1989] HCA 45; (1989) 168 C.L.R. 1.

[15] [1994] HCA 30; (1993-1994) 181 C.L.R. 41.

[17] [1997] 1 V.R. 332.

[20] [1990] HCA 31; (1990) 170 C.L.R. 70.

[22] [1994] HCA 30; (1993-1994) 181 C.L.R. 41.

[24] [1997] 1 V.R. 332 at 342.

[25] [1978] VicRp 41; [1978] V.R. 385.

[26] [1978] VicRp 41; [1978] V.R. 385 at 394

[28] [1978] VicRp 41; [1978] V.R. 385 at 396.

[29] [1999] Q.B. 785.

[30] [1999] Q.B. 785.

[32] [1958] 1 W.L.R. 271.

[34] [1999] Q.B. 785 at 798

[35] [1962] 1 Lloyd's Rep. 285.

[37] [1999] Q.B. 785 at 799.

[38] [1999] Q.B. 785.

[40] See United States Trust Co of New York & Ors v Australia and New Zealand Banking Group Ltd & Ors, (1995) 37 N.S.W.L.R. 131; and Allstate Life Insurance Co and Ors v Australia and New Zealand Banking Group Ltd & Ors (No 33), (1996) 137 A.L.R. 138.

[41] Garms v Telstra Corporation Ltd, DC 9804546 Harper J. [1998] V.S.C. 40 at 7.

[42] Imperial Leatherware Co Pty Ltd v Macri & Marcellino Pty Ltd (1991) 22 N.S.W.L.R. 653 at 666.

[43] [1978] VicRp 41; [1978] V.R. 385.

[45] Vakauta v Kelly [1989] HCA 44; (1989) 167 C.L.R. 568.

[46] [1959] HCA 8; (1959) 101 CLR 298.

[47] Cubillo v Commonwealth [2000] FCA 1084; (2000) 174 A.L.R. 97 at 218-220.

[48] [1959] HCA 8; (1959) 101 C.L.R. 298.

[49] Cubillo v Commonwealth [2000] FCA 1084; (2000) 174 A.L.R. 97 at 220.

[50] [1973] VicRp 10; (1973) V.R. 122.

[58] See: Re McCrory Ex parte Rivett [1895] VicLawRp 2; (1895) 21 V.L.R. 3 at 6

[59] [1973] VicRp 10; (1973) V.R. 122 at 135

[61] No. 6362 of 1996 S.C.V. O'Bryan J., 18 October 1996.

[63] [1973] VicRp 10; (1973) V.R. 122.

[64] [1989] HCA 44; (1989) 167 C.L.R. 568.

[66] (1988) 12 F.L.R. 620.

68 [1838] EngR 652; (1838) 8 Ad & El 291; 112 E.R. 847.

[71] Mustill, L & Boyd S, Commercial Arbitration, (2nd ed, companion volume), London, 2001.

[75] Redfern, A. & Hunter M, Law and Practice of International Commercial Arbitration (3rd ed.), London 1999.

[80] Mustill, L & Boyd S, Commercial Arbitration, (2nd ed, companion volume), London, 2001 at 3.

[81] [1999] V.S.C. 235.

[82] Unreported, NSW Supreme Court, 2 September 1994.

[88] Unreported, Supreme Court of Queensland, Lee J., 29 October 1993.

[90] (1990) 52 BLR 42.

[91] Supreme Court of Queensland Appeal No. 17 of 1994, 2 November 1994.

[98] [1966] 1 Q.B. 630 at 642.

[99] Supreme Court of Queensland Appeal No. 17 of 1994, 21 November 1994, at 20.

[100] Supreme Court of Queensland Appeal No. 17 of 1994, 2 November 1994.

[103] [1832] EngR 423; (1832) 3 B & Ad 295; 110 E.R. 110.

[105] [1839] EngR 677; (1839) 10 Ad & El 139; 113 E.R. 53.

[107] [1836] EngR 732; (1836) 5 Ad & El 147; 111 E.R. 1121. See also Johnson v Latham (1850) 19 L.J.Q.B. 329.

[108] Tomlin v Fordwich Corporation [1836] EngR 732; 111 E.R. 1121 at 1123.

[109] See: Holdsworth v Wilson (1863) 4 B & SI at 18; [1863] EngR 545; 122 ER 360; Simpson v IRC [1914] 2 KB 842; Matthews v IRC [1914] 3 K.B. 192 CA; Knott v Long (1735) 2 Stra 1025; 93 E.R. 1010; Cargey v Aitcheson [1823] EngR 41; (1823) 2 B & C 170, 107 ER. 346; Johnson v Latham (1850) 19 L.J.Q.B. 342; Haigh, Haigh v Haigh (1861) 5 L.T. 507.

[110] Bradford v Bryan (1741) Willes 268; 25 E.R. 1167; Randall v Randall [1805] EngR 357; (1805) 7 East 81; 103 E.R. 32; Turner v Turner [1827] EngR 646; (1827) 3 Russ 494; 38 E.R. 661; Ross v Boards [1838] EngR 652; 8 Ad & El 291, 112 E.R. 847.; Porter v Porter (1921) 55 I.L.T. 206; Re Marshall and Dresser (1842) 3 Q.B. 878; Hewitt v Hewitt [1841] EngR 198; [1841] 1 Q.B. 110; Wilkinson v Page [1842] EngR 156; (1842) 1 Hare 276; 66 E.R. 1036; Samuel v Cooper [1835] EngR 480; (1835) 2 Ad & El 752; 111 E.L.R. 290; Bowes v Fernie (1838) 4 My & Cr 150; 41 ER 59; Wilkinson v Page [1842] EngR 156; (1842) 1 Hare 276; 66 E.R. 1036.