Court Reporter
THE Supreme Court has overturned a High Court decision which gave effect to an arbitration award requiring the National Social Security Authority (NSSA) to pay Housing Corporation Zimbabwe (HCZ) US$22 million in a botched housing deal.
This was in addition to US$16 million which NSSA had already paid to HCZ. NSSA and HCZ had concluded a housing off-take agreement which required HCZ to make available to NSSA 8 000 housing units at US$38 000 per unit.
But without availing a single unit, and having received the US$16 million deposit, HCZ cancelled the contract and claimed US$56 million in damages.
Independent arbitrator Mr Peter Lloyd awarded HCZ US$22 million and a challenge by NSSA to the award failed in the High Court.
NSSA, which was represented by Advocate Thabani Mpofu challenged the decision at the Supreme Court, which in an impromptu ruling yesterday, allowed the appeal with costs.
A panel of three judges of the Supreme Court, Justices Susan Mavangira, Tendai Uchena and Felistus Chatukuta, heard the appeal.
Through its lawyer, Adv Daniel Tivadar, HCZ had strenuously opposed the appeal.
HCZ successfully sued NSSA for repudiation of contract before the arbitrator. When HCZ approached the High Court to register the arbitration award, NSSA contested this, arguing that the award was irregular, as it held NSSA liable to damages that were not part of the contract.
But the lower court in July last year allowed the registration of the arbitral award as the order of the (High) court, ruling that NSSA had serious challenges in proving its case, as the legal and factual findings by the arbitrator were not demonstrably wrong.
This, the court said, was because the arbitrator confined himself to the facts, issues and the law as submitted by the parties, noting that NSSA failed to demonstrate that the award was against public policy, or let alone show that the reasoning and conclusions of the arbitrator were wrong in fact or in law.