When one party denies tribunal’s jurisdiction

Q.
What happens when one party to an arbitration denies that the tribunal has jurisdiction over the dispute? Is the doctrine of kompetenz-kompetenz followed in arbitration?

A.
The party denying that the tribunal has jurisdiction to determine the dispute must raise a plea and challenge the arbitrator's jurisdiction. This can either be a partial or total challenge.

• A partial challenge arises when it is submitted that certain of the claims or counterclaims do not fall within the jurisdiction of the arbitrator;
• A total challenge occurs when it is contended that the arbitrator has no jurisdiction to determine any of the claims or counterclaims which have been submitted to it.

There are two different time limits for raising the pleas (s.18(3) & (5):

• A partial challenge plea must be raised as soon as the matters that fall outside the tribunal's jurisdiction are dealt with.
• A total challenge plea must be raised no later than the submission of the statement of defense.

Competence of arbitral tribunal to rule on its jurisdiction
18. (1) The arbitral tribunal may rule on its own jurisdiction, including any objections with respect to the existence or validity of the arbitration agreement.

Where the arbitral tribunal makes a ruling on its jurisdiction, any party can, within 30 days after receiving the notice of that ruling, appeal to the the High Court to decide the matter - s.18(8).

S.18 (8) Where the arbitral tribunal rules on such a plea as a preliminary question that it has jurisdiction, any party may, within thirty days after having received notice of that ruling appeal to the High Court to decide the matter.

Once the appeal is heard and the High Court comes to a decision, there can be no further appeal against the decision of the High Court - s.18 (10).

S.18 (10) No appeal shall lie against the decision of the High Court under subsection (8). 

The High Court cannot make a decision on the tribunal's jurisdiction unless an arbitral tribunal has made a ruling on its jurisdiction first.