The Civil Division of the High Court in Kampala has nullified a 680 million shillings arbitration award granted to Central Plumbing Works Limited.
The award stemmed from a case involving the construction of additional water reservoirs at Entebbe International Airport.
In a ruling dated January 25th, 2024, Justice Musa Ssekaana granted a successful application by the Uganda Civil Aviation Authority (UCAA) to overturn the award.
The UCAA argued that the award, issued by an Arbitration Tribunal chaired by Belinda Lutaya Nakiganda on November 25th, 2022, was invalid due to improper composition.
The dispute arose after Central Plumbing Works Limited filed a claim before the Arbitration Tribunal on December 2nd, 2021, following disagreements outlined in the construction works agreement.
The UCAA contended that alterations made to the arbitration process, particularly in the appointment of the tribunal chairperson, were illegal and lacked the required approval from the Solicitor General.
Although Central Plumbing Works Limited argued that the arbitration process was properly conducted and objections were not raised during proceedings, Justice Ssekaana emphasized the importance of upholding legal standards in agreements involving public bodies like the UCAA.
Justice Ssekaana ruled that the alteration of the arbitration dispute clause without proper approval constituted a breach of the law governing such agreements. He underscored that the court cannot condone illegalities, especially when they involve public funds.
Furthermore, Justice Ssekaana highlighted that once a party challenges the appointment process, the entire procedure for selecting the arbitrator must be scrutinized. Consequently, he upheld the UCAA’s right to challenge the flawed appointment process, emphasizing the importance of adherence to legal protocols in arbitration proceedings.
