Authored By: Nwachukwu Favour Chiamaka
Enugu State University of Science and Technology, Nigeria.
Abstract
The arbitral process has remained quite useful to man in quest of dispute resolution even long before the establishment of a formal Court or the formulation of principles of law. In England, merchants resorted to arbitration to settle trading disputes in the early Middle Ages, long before the King’s Courts figured out a way to enforce contractual obligations arising from a contractual agreement between parties. Infact, the process of native arbitration has been part and parcel of communal co-existence among African societies. Arbitration is the most well-known Alternative Dispute Resolution (ADR) method. It’s preferred as an alternative to litigation because it offers a distinct approach to resolving disputes without promoting litigation.In recent and modern times, the term Alternative Dispute Resolution (ADR) has been restricted by some writers and jurists to include only mediation, negotiation, and conciliation, excluding arbitration. They argue that arbitration is increasingly plagued by delays, profligacy, and disruptive technicalities, similar to litigation. However, this view is inaccurate. There are several distinguishing factors that differentiate arbitration from litigation, such as the use of summons in litigation versus voluntary submission in arbitration. This paper critically examines and highlights the fact that arbitration is an integral part of ADR, distinct from litigation in its characteristics.
Keywords: Arbitration, summons, voluntary submission, Customary arbitration.
Introduction
Within the intricate tapestry of the Nigerian jurisprudence the discussion surrounding the critical examination of arbitration within Alternative Dispute Resolution and it’s enduring relevance in dispute resolution necessitates a judicious examination of legal definitions, legal principles, and pivotal terms.
Arbitration is the reference of a dispute or difference between two or more parties for determination, after hearing both sides in a judicial manner, by a person or persons other than a court of competent jurisdiction[1]. It is a private adjudicatory process, distinct from public court litigation, designed as an alternative approach to resolving disputes. The above definition, as contained in Halsbury’s Laws of England, was affirmed by the Supreme Court in NNPC v. Lutin Investment Ltd.[2] The Supreme Court, in Ohiaeri v. Akabueze,[3] adopting the definition of Customary Arbitration in Agu v. Ikewibe[4], defined it as an arbitration in a dispute founded upon the voluntary submission of the parties to the decision of arbitrators who are either the chiefs or elders of their community, and the agreement to be bound by such decision or freedom to resile if unfavorable. The elders in a customary arbitration are versed in the customary law of the people, and they make decisions that are mainly aimed at bringing about an amicable settlement, stability, and social equilibrium to the people and their immediate society.
Is Arbitration Part and Parcel of ADR
Alternative Dispute Resolution (ADR) methods are today defined in a narrow sense to mean consensual methods of dispute resolution, distinct from the adjudicatory method of arbitration, which is highly debatable.
Some jurists have argued that arbitration is not part of Alternative Dispute Resolution (ADR), while others believe it is an integral part of ADR. Some jurists opine that traditional arbitration was once part of ADR, but in recent times, it has become sophisticated and acquired pro-litigation characteristics, losing its consensual nature, and therefore is no longer an alternative to litigation.
Notable figures like Sir Lawrence Street[5] have taken the view that arbitration is not part of ADR. The Drafting Committee of ADR set up in England in 1999 also accepted the view that arbitration has become sophisticated, mirroring litigation, and is now pro-litigation rather than consensual, excluding it from ADR. Asuzu holds the view that arbitration, due to its judicial character, relative formalities, and decisional legions in our law, is closer to court proceedings. Therefore, it is no longer considered part of ADR.
However, Nnaemeka Agu JSC (as he then was) delivered a dissenting opinion, asserting that arbitration is an integral part of Alternative Dispute Resolution (ADR). He posited that litigation follows a formal channel through the court, where the judicial power of the Nigerian state is vested by virtue of Section 6 of the Constitution. In contrast, ADR offers an alternative approach. Once parties voluntarily submit their dispute to arbitration and a decision or award is given, it is binding on them as a matter of law. Nnaemeka Agu JSC maintained this position in Agu v. Ikewibe,[6] where he delivered a dissenting opinion and outlined the necessary conditions for customary arbitration to be binding. In the same case, he emphasized that a party can resile from an arbitration award or decision, unlike a court decision. This aligns with Professor Greg C. Nwakoby’s[7] views and the pre-existing law before the ruling in Agu v. Ikewibe.[8] The pre-existing law essentially allows people to settle disputes through the court or alternative approaches, and once they voluntarily submit to arbitration, the award is binding if arbitration requirements are met.
Professor Elliot asserted that relating customary arbitration in Africa to the Western world is incongruous with African culture. According to him, customary arbitration in Africa is more about terms and settlement, and parties can resile if they don’t accept the decision. This view was highlighted in his book, “Essays on African Law.” Justice Uwaifo initially held this position in Okpuruwa v. Okpokam,[9] stating that it is a misnomer and certainly a misconception to attribute binding force to customary arbitration in the Nigerian legal system.
However, Justice Oguntade disagreed, arguing that customary arbitration does not undermine the High Court’s authority because parties who voluntarily submit to arbitration and receive a decision cannot resile or challenge it in court without facing estoppel. Interestingly, when Justice Uwaifo later became a Justice of the Supreme Court, he changed his view, recognizing customary arbitration as part and parcel of Nigerian jurisprudence with binding force in the case of Duruaka Eke v. Okwaranyia.[10] In Assampong v. Kweku Amuaka,[11] the West African Court of Appeal held that decisions reached through mutual arbitration are binding on the parties and enforceable by the Supreme Court.
In my humble opinion, upon examining the conditions or requirements necessary for arbitration to be binding, such as being reduced to writing and other stipulations in accordance with the provisions of the Arbitration and Mediation Act of 2023 (as amended), it becomes evident that arbitration is neither akin to litigation nor pro-litigation but rather an alternative to litigation. This principle also applies to customary arbitration, which requires the voluntary submission of the dispute by the parties involved, their express or implied agreement to be bound by the arbitrator’s decision as final and binding, provided the decision considers their custom, trade, or business, and an award is published by the arbitrators. Therefore, once the requirements of arbitration or customary arbitration are pleaded and proved, and the arbitrators’ decision is unbiased, respects the parties’ right to fair hearing, and adheres to the rules of natural justice, the decision or award is binding on the parties as a matter of law and creates an estoppel. However, if the arbitrators’ decision is biased or fails to observe the rules of natural justice, the court can set it aside. Although orthodox arbitration or customary arbitration is judicially recognized as a medium for settling disputes, its position cannot be equated to that of a regular court. This principle is supported by the dictum of Niki Tobi JSC in Ufomba v. Ahuchaogu.[12] Notably, Niki Tobi JSC’s dictum in Ufomba’s case does not undermine the judicial recognition of customary arbitration, as parties have the right to choose whether to litigate their disputes in court or submit them voluntarily to a non-judicial body for decision, as supported by Section 6 of the 1999 Constitution of the Federal Republic of Nigeria (as amended). Indeed, in accordance with the above principles and decided cases, it is crystal clear that arbitration is not a pro-litigation but part and parcel of ADR.
Voluntary submission and summons at Customary arbitration
Voluntary submission is a prerequisite for all arbitration. In other words, parties must have agreed expressly or impliedly to submit their dispute to arbitration and agree to be bound by the arbitrators’ decision as final and binding. The position of the law regarding voluntary submission to arbitration has been consistent under Nigerian law. A summons is a command or call in an official matter, such as to attend court, whereas voluntary submission occurs when parties to a dispute willingly agree to submit their dispute to arbitration without being forced or compelled by a court or any other authority.
Notably, scholars have been concerned about the consequence of such voluntary submission as opposed to a summons, particularly after the Supreme Court’s decision in Agu v. Ikewibe.[13] Before Agu’s case, the legal position was that since arbitration is based on voluntary agreement or submission, the arbitrators’ decision is binding on the parties.
In Agu v. Ikewibe,[14] Nnaemeka Agu JSC delivered a dissenting opinion, emphasizing that the use of the word “summon” implies compulsion, negating the essential element of voluntariness. He also noted that using “summon” in court proceedings is an abuse of language, as it undermines the voluntary nature of the submission. The case involved a land dispute where one party reported the matter to the Igwe’s palace, and after a settlement, the other party refused to accept the unfavorable decision. The party in whose favor the decision was made went to court to enforce an estoppel, claiming he had summoned the other party before the chiefs and elders. Karibi-Whyte JSC held that the requirements for a valid customary arbitration were met, making the decision binding. However, Nnaemeka Agu JSC dissented, arguing that the use of “summon” implies a lack of voluntariness.
Professor Ezejiofor[15] opined that it would have been better to say the appellant was invited rather than summoned, as the latter undermines the voluntariness of the submission. Karibi-Whyte’s view in Agu’s case seems more suggestive of customary conciliation or mediation than arbitration.
In Professor Chijioke Agbo’s view, the use of summon in Agu’s case suggest that the party was bound to appear and submit himself in Court and could not say no and therefore because of the want of a relevant Ingredient of arbitration, it be anything else but not arbitration such negotiation or attempt at settlement. In the case of Kwasi v. Larbi,[16] the Privy Council held that the proceeding before the elders were of a nature of arbitration and not merely negotiation for settlement, because it was undertaken with the consent of the parties and the defendant had no right to resile from the arbitration before the award since they had no such right after the award.
Conclusion
The debate surrounding arbitration’s place within Alternative Dispute Resolution (ADR) underscores the complexities of dispute resolution in Nigeria. While some argue that arbitration has become increasingly litigious and therefore falls outside the realm of ADR, others contend that its voluntary nature and binding decisions make it an integral part of the ADR framework. This article has demonstrated that both orthodox and customary arbitration have distinct characteristics that set them apart from litigation. Ultimately, the effectiveness of arbitration as a dispute resolution mechanism hinges on the parties’ willingness to submit to the process voluntarily and abide by the arbitrators’ decisions. As the Nigerian legal system continues to evolve, it is crucial to recognize the value of arbitration in providing an alternative to litigation, while also ensuring that the process remains fair, efficient, and binding on all parties involved.
Reference(S):
[1] Halsbury’s Laws of England, P.256 vol. 2(4th ed.).
[2] NNPC v. Lutin Investment Ltd (2006)NSCQR 77 at 22.
[3] Ohiaeri v. Akabeze (1992)2NWLR (pt. 221)1.
[4] Agu v. Ikewibe (1991)3NWLR (pt.180)385.
[5] L. Street, “The Language of ADR: Its Utility in Resolving International Commercial Disputes– The Role of Mediator” , 1922, 58: Arbitration, 18–19.
[6] Supra.
[7] Prof. Greg.C. Nwakoby, “Arbitrators – The Issue of Duties and Immunity” Nigerian Bar Association, Abakiliki Branch Bar Journal, Vol. 1, No. 1, May 2006 1–22.
[8] Supra.
[9] James Okpuruwa v.kieran Okpokam & Anor (1988) 4 NWLR (pt.90) 554 at p.566.
[10] Duruaku Eke V Udeozor Okwaranyia (2001) LLJR-SC.
[11] Assampong v. Kweku Amuaka & ors (1932)1WACA 192 at p. 201.
[12] Sunday Ufomba & Anor. V. Wosu Ahuchaogu & Ors (2003) LLJR-SC
[13] Supra.
[14] Supra.
[15] G. Ezejofor, “ The Prerequisite of Customary Arbitration”, Journal of Private and Property Law, University of Lagos, April, 1993, Vol.16, pp 19–35.
[16] Kwarsi & Ors v. Larbi (1952) 13 WACA 76 at p.80.
