OCA Testing and Certification South Africa (Pty) Ltd v KCEC Engineering and Construction (Pty) Ltd and Another

The parties concluded three separate written agreements in June 2017 in terms of which OCA Testing undertook to provide advisory, technical and mechanical non-destructive testing services to KCEC Engineering. Disputes later arose when KCEC Engineering refused to pay outstanding tax invoices. OCA Testing referred the dispute to arbitration and claimed a composite amount of R2 603 729.44 arising from the three agreements. KCEC Engineering admitted that services were rendered but raised defences including late performance, overpayment, and a counterclaim for damages. The arbitrator found OCA Testing in breach of the first agreement and dismissed that portion of the claim, rejected KCEC Engineering’s defences and counterclaims relating to the second and third agreements, but nevertheless dismissed OCA Testing’s entire composite claim without determining the merits of the amounts arising from the second and third agreements.

The appeal was upheld. The High Court order was set aside. The arbitral award was reviewed and set aside insofar as it related to the amounts claimed under the second and third agreements, and the dispute concerning the residue of the claim was referred to a new arbitrator. No order as to costs was made.

The judgment clarifies the scope of judicial intervention under s 33(1) of the Arbitration Act, reaffirming that courts will not interfere with arbitral awards for mere errors of fact or law but will do so where an arbitrator fails to decide issues within the mandate. It also confirms that South African courts may partially set aside arbitral awards where only a separable portion is tainted by irregularity.