The issue was whether an arbitrator has power to amend a contract.
The applicant was challenging an arbitral decision arguing that the composition of the arbitration tribunal and the award itself were wrong. It argued that the arbitrator dealt with an issue which was not contemplated by the parties and that he amended the subject contract in contravention of clause 10 of the contract. The applicant further alleged that the conduct of the arbitrator showed bias in favor of the respondents.
The respondent on the other hand argued that there was no evidence to show that the arbitrator was partial. They further contended that there was no contravention of clause 10 because the amendments were made in terms of clause 13 of contract.
In deciding the case, the court held that amendments to the contract cannot be made without consensus of each party. It ruled that an amendment in terms of clause 13 required an arbitrator appointed in accordance with that provision. It further held that the clause 10.2 of the contract only allowed an amendment by agreement in writing by both parties which was not the case in the matter before the court.
On allegations of partiality of the arbitrator, the court found that communication between the applicant and respondent shows likelihood of bias. The court further ruled that the composition of the tribunal was not in accordance with the contract. All these amounted to breach of the Arbitration and Conciliation Act. The arbitration award was set aside.