CLOUT
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A dispute arose between the plaintiff and the defendant as to whether the plaintiff had the right under their joint venture agreement to acquire the defendant's share in the joint venture. The parties agreed that the matter should be submitted to arbitration pursuant to an arbitration clause contained in their agreement. However, the plaintiff sought from the court to rectify a provision of the agreement or, alternatively, to declare that provision void on the ground that it contained a drafting mistake and did not actually reflect the parties' agreement. The defendant sought a stay of proceedings and submission of the whole dispute to arbitration.

The court found that the issue whether the arbitral tribunal had the power to rectify the parties' written agreement was a matter of interpretation of the arbitration agreement. It was held that, while the expression arising "under" or "in relation to the construction" of the agreement contained in the arbitration clause was not as broad as the expression "all disputes arising in connection with", which was held by courts to be sufficient to cover the equitable remedy of rectification, it was broad enough to cover rectification of the agreement. The court, citing its decision on Gulf Canada etc. (case 31) noted that in doubt the arbitration clause should be interpreted in a manner that would be conducive to arbitration. The court granted a stay of the proceedings and referred the matter to arbitration.

Additional Information published in later CLOUT issue (on "9 February 2000"):

Abstract published in English: [1996] Model Arbitration Law Quarterly Reports, Vol. 2, issue 1, 83

Text of the court decision published in English: [1996] Model Arbitration Law Quarterly Reports, Vol. 2, issue 1, 87

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