In a recent decision (Zografos and others v. Drosoneri Farm Ltd - Civil Appeal 379/2012), the Supreme Court ruled that, when examining a case, a Court cannot look at independent issues that have not been included in the parties' pleadings – a stark reminder to litigants (and their lawyers) of the important role of pleadings in litigation.
The facts of the case
An arbitrator in a dispute made an award in favour of one of the two parties. The other party applied to the Court to set aside the award on the basis of alleged misconduct by the arbitrator, contrary to section 20 (2) of the Arbitration Law, Cap. 4.
An originating summons supported by affidavits was filed, without however this procedural matter being examined by the Court. On the contrary, it was mutually accepted by the parties that the contents of the affidavits had the same role and significance as pleadings in a civil action, thus limiting the matters in issue to the actual contents of the affidavits.
The Court of first instance set aside the arbitrators' award on the basis of an issue that was raised during the proceedings, namely the fact that one of the arbitrators attended a meeting with a director of one of the litigants in which he was asked to rule in favour of that party. The arbitrator immediately refused and ended the meeting. This matter was not set out in any of the parties' pleadings.
The appeal before the Supreme Court was made on two grounds: first, that the Court at first instance had examined an extraneous matter, (i.e. an issue that was not alleged in the pleadings) and, second, that the arbitrator's conduct was in breach of the duties set out in the relevant legislation.
The Supreme Court's Decision
The Supreme Court relied on the first ground and decided to allow the appeal, on the basis that the matter raised was beyond the limits set by the framework set out in the parties' pleadings. In other words, the Court of first instance acted unfairly in setting aside the arbitrators' award for reasons that were not mentioned in and were independent of the parties' pleadings.
The decision highlights the central role that pleadings have in a case and is a reminder to all parties that they should include all points that require the Court's examination in their pleadings.
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