HIGH COURT, ACCRA
DATE: 16TH MARCH, 1962
BEFORE: OLLENNU, J.
CASES REFERRED TO
(1) Parkers v. Smith (1850) 15 Q.B. 297; 117 E.R. 470
(2) Pini v. Roncoroni [1892] 1 Ch. 633
(3) Geddes v. Wallace (1820) 2 Bligh. 270; 4 E.R. 328
(4) England v. Curling (1844) 8 Beav. 129; 50 E.R. 51
NATURE OF PROCEEDINGS
APPLICATION for court order to appoint a manager or receiver of partnership properties.
COUNSEL
E. Akufo-Addo for the applicant.
B. E. Kwaw-Swanzy (with him Agyeman) for the respondent.
JUDGMENT OF OLLENNU J.
[His lordship stated the facts as set out in the headnote and continued:] As to the first preliminary point raised: although there are cases in which submission to arbitration can only be effective when an arbitrator is named, the general rule is that consent to submit becomes a good submission as soon as a dispute or controversy arises, see Parkers v. Smith,1(1) and Halsbury (3rd ed.) Vol. 2, pages 5-6, note “s”.
It also appears from section 8 of the Arbitration Act 1961,2(2) that the Act regards an arbitration agreement as a submission to arbitration as soon as a dispute arises under the contract between the parties which contains the agreement to refer. I am strengthened in this view by the earlier judgment of the Supreme Court delivered by van Lare, J.S.C. There his lordship said inter alia, “The law allows parties to a contract to include in its terms an agreement to refer disputes which may arise to arbitration, and the normal rule is that the courts respect such a reference by staying legal proceedings instituted without honouring such arbitration clause.”3(3)
[p.172] of [1962] 1 GLR 170
And at a later stage his lordship further said: “The arbitration clause not having been disputed, and it appearing in law that an arbitrator is competent to deal with the whole of the dispute on both questions of law and fact the legal position of the parties must be regulated by the Arbitration Ordinance and the court should enforce the reference by staying proceedings as it does not appear that there is any reason why the matter should not be referred in accordance with the submission.”4(4)
I hold therefore that there is a submission.
On the objection to the title of the matter and the omission to include in it: “In the matter of Arbitration Act,” counsel for the respondent referred the court to Odgers on Pleadings and Practice (16th ed.) pages 345—46. There the learned author said: “Where the application is made, as it usually is, under the provisions of an Act of Parliament, it must always be headed in the matter in which the question arises and in the matter of that Act.” He then gave the following illustration with an application for the appointment of new trustees of the statutory trusts affecting the estate of an intestate as follows:- “In the matter of the statutory Trusts arising upon the intestacy of John Doe—deceased—by virtue of the Intestate’s Estates Act, 1952 and In the matter of the Trustees Act, 1925”.
Although the learned author said the Act must always be set out in the heading, I have looked in vain for any authority or statutory provision which says that omission to recite the Act is fatal to the application.
Besides, the affidavits filed by both the applicant and the respondent show that the real matters to which the application relates are the partnership agreement and the reference to arbitration therein; but the jurisdiction of the court to entertain that application is given by section 16 of the Arbitration Act, 1961.
In my opinion, since the right of a party to the arbitration to make such an application of an interim nature is not derived from the Act, the Act need not be recited in the heading to the application. It is enough if the court is referred to the Act in the course of the argument of the motion.
On the merits of the motion, Mr. Akufo-Addo, counsel for the applicant submitted that the affidavits filed by the parties disclose that there are many matters in difference between the parties all of which will form the subject-matter of the arbitration, and that the mere submission is sufficient ground upon which the court should feel itself bound to appoint a receiver and manager in respect of properties which belong to the partnership. On this point he referred the court to Halsbury (3rd ed.) Vol. 28, page 554, para. 1080, and Pini v. Roncoroni.5(5)
Mr. Swanzy for the respondent referred the court to letters exhibit MK5 A and B exchanged between the parties which showed that the parties had distributed the physical assets and each party had since April, 1958, treated those properties released made and allowed to him, as his exclusive individual property, he also referred the court to allegations in his client’s affidavit that the applicant had alienated two of the real properties and drawn some moneys on the partnership assets. He submitted that exhibit MK5 A and B are variations of arbitration clause
[p.173] of [1962] 1 GLR 170
limiting the scope of the arbitration only to debts to be collected and apportioned; this he submitted, the parties are entitled to do. He cited Geddes v. Wallace6(6)6 and England v. Curling.7(7) In the latter case it was held, inter alia, that parties may make constant variations in the terms of their partnership agreement which may be evidenced not only writing but by their conduct.
Now the matters which are relied upon as varying the agreement to submit to arbitration and limiting the scope of its operation do not in my opinion effect the submission to arbitration. If both parties had been satisfied with the distribution of the physical assets as set out in exhibit MK5 A and B there would have been strong force in the submission of counsel. This, however, is not the case. I have already pointed out that one of the claims which the respondent made in the suit which has been stayed is for an order for specific performance of the dissolution agreement; that agreement included the distribution of the physical assets as are contained in the said exhibit MK5 A and B.
Again the judgment of the Supreme Court set out the matters which are the subject of the arbitration submission, and included in it the question of the distribution of the assets. I shall quote a few passages from the judgment dealing with that issue: “The appellant later that month withdrew the instructions to the said Mr. Lynes to prepare the deeds of transfer of the properties contained in the memorandum of distribution and indicated that he would refuse to sign any deed of transfer. It does appear in those proceedings that the appellant assumed this attitude alleging that the division of the properties of the partnership was subject to a condition that the respondent should submit certain facts for the purpose of taking the partnership accounts and further that the partnership would be kept going for the purpose of winding-up the affairs of the partnership. The appellant alleged that the respondent had failed to honour this condition upon which the distribution memorandum was based and therefore considered himself not bound to execute the deed of dissolution prepared by Mr. Lynes. A dispute thus arose between the parties and it becoming irreconcilable each of the partners consulted different solicitors.”8(8)
The Supreme Court also said: “It is not in dispute that it was agreed to dissolve the partnership, but differences arose concerning the distribution of assets, and the appellant has refused to sign the dissolution agreement. Although it is admitted that the partnership between the parties has been dissolved with effect from the 1st April, 1958, nevertheless the partnership account appears to be still subsisting and requires adjustment. The main
point however for determination would be whether the draft deed prepared by Mr. Lynes is binding as a matter of law and this question together with the other ancillary reliefs relating to the accounts cannot be decided without ascertaining a number of facts. The whole of the dispute is easily discernible, and there is no doubt that each and every question falls within the ambit of the arbitration clause.”9(9)
These passages of the judgment of the Supreme Court together with the affidavits filed by both parties show that distribution of the assets of the partnership forms part of the matters the arbitrator or arbitrators would enquire into, therefore the court ought to grant an order for a receiver. But I am not convinced that the appointment of a manager will be in the interest of both parties. I therefore make an order for the appointment of a receiver.
DECISION
Appointment of receiver ordered.
