SUPREME COURT REITERATES THAT WHERE A PARTY ADMITS LIABILITY AND FAILS TO PAY, THERE IS NO DISPUTE TO BE REFERRED TO ARBITRATION

Our newsletter examines the Supreme Court’s decision in Sakamori Construction (Nig) Ltd v. Lagos State Water Corporation [2021] LPELR-56606(SC). The apex Court held that the dispute which parties to an arbitration agreement consent to refer to an arbitration must consist of justifiable issues triable civilly, and a court or tribunal should only give effect to an arbitration clause where the dispute is unequivocally within the ambit and contemplation of the arbitration clause in question.

With regard to the appeal, it held that the dispute which arose from an admitted debt did not fall within the purview of the dispute envisaged under the parties’ arbitration agreement, especially since the debt was consistently acknowledged and admitted by the debtor.

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