Headnote

Arbitration – Appointment of arbitrators

Summary of facts

The Petitioner, in an action brought against the Respondent, requested that the Dubai Court of First Instance appoint an arbitrator to determine, under the supervision of the Court, a dispute that had arisen between the parties. The arbitration agreement entered into by the parties provided for the name of the arbitrator to settle any dispute between them. The dispute related to the Petitioner’s claim of AED 237,248 against the Respondent. The Court of First Instance dismissed the Petitioner’s action. The Petitioner appealed to the Court of Appeal, which confirmed the judgment of the Court of First Instance. Thereafter, the Petitioner filed a petition to cassation.

The Respondent challenged the petition on the basis that the judgment of the Court of First Instance (which was subsequently upheld by the Court of Appeal) was “unchallengeable”. The Respondent relied upon Article 204.2 of the UAE Civil Procedure Code, arguing that the application of this provision was not limited to judgments dealing only with the appointment of arbitrators.

Held

The petition to cassation was dismissed.

The effect of Article 204 of the UAE Civil Procedure Code is that unless the arbitrator initially agreed to by the parties abstains from working, resigns, is dismissed, is judged to be dismissed or is otherwise prevented from working, it is not possible to challenge the Court’s decision as regards the identity of the arbitrators appointed by it. This is an exception to the general rule that judgments can be appealed. The exception does not extend to judgments that dismiss a request to appoint an arbitrator.

Judgment

The Petitioner argued that the judgment delivered by the Court of Appeal, in which the Court of First Instance’s judgment was upheld, was an order rejecting the request that an arbitrator be appointed to settle the dispute between the two parties. Hence, it was capable of being challenged before the Court of Cassation. The Petitioner argued that there was no dispute that the parties were bound by an arbitration agreement and that the Petitioner used its best endeavours to conduct the arbitration. The Petitioner noted that the Respondent had directly refused to respond to the request for arbitration. The Petitioner also argued that the Respondent suggested that the Petitioner had not complied with the preconditions to arbitration in the arbitration agreement, which required the dispute to be presented first to an engineer. The Petitioner further argued that the Court, having determined not to appoint an arbitrator, had given up the power vested in it under Article 204 of the Civil Procedure Code.

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The Court of Cassation held that these arguments were incorrect. Whenever parties agree to refer to arbitration disputes that arise between them and appoint an arbitrator, the arbitration clause should be enforced and the dispute should be referred to the arbitrator selected by the parties. Neither party to the dispute may have recourse to the court of competent jurisdiction to appoint a different arbitrator, unless the arbitrator initially agreed to by the parties abstains from working, resigns, is dismissed, is judged to be dismissed or is otherwise prevented from working. The Court of Cassation explained that the burden of proof of establishing the existence of a circumstance falling within Article 204 lies with the Petitioner, because it was the Petitioner who was seeking the appointment of a different arbitrator. It is established in the decisions of this Court that interpretation of facts and evaluation of evidence in order to assess the truth is within the jurisdiction of the court of merits and may not be assessed by the Court of Cassation.

The judgment of the Court of Appeal, which upheld the judgment of the Court of First Instance, was premised on the fact that the Petitioner submitted with its appeal supporting documents that included a message sent to the Respondent in respect of the arbitration proceedings together with a reply from the Respondent in which the Respondent alleged that the request for arbitration should be nullified. The supporting documents also included a photocopy of the message sent to the agreed arbitrator.

The Court of Cassation held that the supporting documents described above were not sufficient to prove that the Respondent had chosen not to participate in the arbitration.

Accordingly, the present petition to cassation was dismissed.