Brazilian construction firm Construtora OAS SA has appealed a High Court ruling that nullified an $850 million arbitration award it secured over the Solomon Hochoy Highway extension project. The appeal was heard on May 15 by Justices of Appeal Nolan Bereaux, Peter Rajkumar, and Mark Mohammed.
OAS contends that Justice Frank Seepersad overstepped his jurisdiction by setting aside the award, arguing that the contract with the National Infrastructure Development Company Ltd. (Nidco) stipulated that disputes be resolved exclusively through arbitration.
The company’s lead attorney, Rolston Nelson, KC, argued that the High Court lacked the authority to overturn the award.
Nidco's legal team, led by British King's Counsel Anneliese Day, argued that the arbitrators failed to adequately assess critical evidence and misapplied contractual terms. She submitted that the arbitrators made errors when assessing the case and failed to provide reasons why they ignored evidence that supported Nidco’s contentions.
Day said the clause Nelson referred to did not remove the local court’s jurisdiction. She maintained that Seepersad correctly decided the case because of the tribunal’s “irrational findings.”
In his judgment, Seepersad pointed to various areas of the award where he found the tribunal failed to put forward a position, properly evaluate, or make a finding on the evidence and contentions put forward by Nidco.
“The tribunal had an obligation to critically review all the information before it and to explain why the claimant’s arguments and evidence were rejected. However, the award does not reflect that such a measured evaluation of the evidence was engaged,” Seepersad said.
In his judgment in the case, Seepersad remitted the case to the London Court of International Arbitration for its reconsideration.
Seepersad found that on the face of the award, the tribunal fell into error and/or disregarded, or misconstrued the law and failed to properly evaluate the evidence.
He said: “Having reviewed the evidence which is before the tribunal, this court is resolute in its view that no reasonable arbitrator cognisant of the law and seized of the evidence adduced could have arrived at the position reflected in the award.”
“In the circumstances, this court, without fear or hesitation, must exercise its inherent jurisdiction and discharge its obligation to defend the rule of law and to protect the public interest. Consequently, the commercial decision reflected in the contract to have disputes determined by the arbitrator has to be overridden and the court must set aside the award, as same was premised upon findings that were unsupportable on the evidence, inconsistent with the law, and are decisions which no reasonable arbitrator could have arrived at,” he added.
In early 2011, OAS was awarded the contract for the project, which was then estimated to cost approximately $5.3 billion. After the contract was terminated in 2016, the project was put on hold for several years before being restarted with local contractors.
