Carol Construction Engineers Ltd v Kenya Agricultural Research Institute [2014] KECA 680 (KLR)
The bottom line
#Kenya's Court of Appeal confirmed that once an arbitrator issues a final award, they cannot fundamentally change it — only fix obvious clerical errors.
What this practically means
#Executive summary
#Key legal issues
#Commencement of the three-month period under section 35(3) of the Arbitration Act
The application to set aside the Revised Final Award was filed within time because the three months ran from 28th March 2004 when the arbitrator disposed of the request for corrections of the Revised Final Award
Although ordinarily the period runs from publication of the final award, the arbitrator's agreement to revise the award, and his subsequent disposal of the request for corrections to the Revised Final Award, complicated matters. The court held that the three-month period began when the arbitrator declined to make corrections of the Revised Final Award, so the application dated 16th June 2004 was filed within time.
Scope of the arbitrator's power to correct an award under section 34(1)(a)
The revisions totally overhauled the award, transforming a finding of Kshs.6,290,288.75 against the appellant into an award of Kshs.3,075,340.55 in its favour; these were not computation, clerical or typographical errors, and the arbitrator acted ultra vires
The permitted corrections are limited to computation errors, clerical or typographical errors or errors of a similar nature. The revision here completely transformed the outcome of the award. There was no consensus between the parties on the corrections, the respondent objected, and the arbitrator ignored the objection and made major revisions without hearing the parties, contrary to natural justice. Once a final award is published the arbitrator becomes functus officio.
Whether the High Court had power to declare the Final Award the legitimate award
The declaration was not a substantive grant of relief; it merely clarified the legal consequence of setting aside the Revised Final Award, which was to restore the Final Award. The appeal against the phrase was incompetent.
Section 35 of the Arbitration Act permits recourse to the High Court only by way of an application to set aside an award. The court held that the learned Judge's use of the phrase declaring the Final Award legitimate did not grant any substantive relief; the substantive relief was the setting aside of the Revised Final Award, whose legal consequence was restoration of the Final Award. The phrase had no legal effect and the appeal against it was incompetent.
Legal principles established
#- Once an arbitrator publishes a final award he becomes functus officio, subject only to making corrections of computation, clerical or typographical errors as provided by section 34(1)(a) of the Arbitration Act
- An arbitrator cannot fundamentally transform or revise a final award under the guise of correcting errors; doing so is ultra vires and offends the principles of natural justice where the parties are not heard
- Where a request to correct an award is properly made and disposed of, the three-month limitation period under section 35(3) of the Arbitration Act runs from the date that request is disposed of
Court orders
#- 1.Upholding the ruling of the High Court to the extent it set aside the Revised Final Award dated 20th February 2004
- 2.Holding that in publishing the Revised Final Award the arbitrator acted ultra vires his powers by fundamentally transforming the award contrary to section 34(1)(a) of the Arbitration Act
- 3.Finding that the phrase 'I declare the Final Award to be the legitimate award of the arbitrator' had no legal effect and the appeal against it was incompetent
- 4.Dismissal of the appeal in its entirety
- 5.Costs of the appeal to the respondent
- On appeal from
- High Court of Kenya at Nakuru
- H.C. Misc. Appl. No. 99 of 2004
- Jurisdiction invoked
- Appellate jurisdiction of the Court of Appeal over an appeal from the High Court (Arbitration Act matter); the judgment does not cite a specific constitutional provision
Key timeline
#Practical implications
#Frequently asked questions
#Cite this brief
#Cite this brief
Caselaw, "Carol Construction Engineers Ltd v Kenya Agricultural Research Institute [2014] KECA 680 (KLR)", Case Analysis (2014). Civil Appeal No. 33 of 2005. Source: https://new.kenyalaw.org/akn/ke/judgment/keca/2014/680/eng@2014-03-20
Suggested citation format for research notes or client memos. Always verify the original judgment before relying on any point.