BuildLaw BuildLaw: Issue 23, March 2016 | Page 26

case in brief:
BSC Construction Ltd v Withers [2015] NZHC 1988

Royden Hindle

The High Court decision in BSC Construction Ltd v Withers [2015] NZHC 19881 represents a significant judicial endorsement of the Building Dispute Tribunal’s ‘on the documents’ rules for expedited commercial arbitration.2

Facts

BSC had contracted with Mr Withers to build an accommodation lodge for him. Disputes arose as to the terms of their contract, and whether or not BSC was in breach. Claims and counterclaims were put forward.

The parties agreed to deal with the issues by arbitration. As the High Court judgment records, they wanted a prompt resolution. By an exchange of emails, they further agreed to conduct the arbitration under the Rules, which provide for an award to be given ‘on the documents’ (i.e., without any viva voce hearing). Both parties understood that the Rules excluded any ability to cross examine witnesses or to make oral submissions.

The Arbitrator made an award in favour of BSC.3 When BSC sought to enforce the award, however, Mr Withers opposed the application and initiated proceedings to have it set aside. His central arguments were that the absence of any opportunity to file evidence in reply to that filed by BSC on its claim amounted to unequal treatment of the parties (thus infringing the right to equal treatment in Article 18 of the First Schedule to the Arbitration Act 1996), and that he had not had a fair hearing as a result.

Decision

The Court held:

There is nothing in the Expedited Arbitration Rules to suggest that the parties contemplated any inequality of treatment. Although they did not provide for a response from Mr Withers to any sworn statements submitted by BSC in response to his counterclaim, that was no different from BSC’s inability to reply to the evidence to be given on Mr Withers’ defence. A symmetrical approach was taken to the evidence to be given in support of and in opposition to BSC’s claim (on the one hand) and evidence in support of and in opposition to Mr Withers’ Counterclaim (on the other).4

… there was no breach of the rules of natural justice by the Arbitrator. He gave both parties an opportunity to be fully heard (on the papers, as agreed between them)