Bidoli v Bidoli & another

Three brothers conducted business together for decades and held joint assets, including property and funds in Italy. Disputes arose regarding the distribution of partnership profits and jointly held assets. In 2007 they concluded an arbitration agreement under the Arbitration Act 42 of 1965 to resolve all disputes. During the arbitration hearing, the parties reached a settlement agreement. One brother later expressed dissatisfaction, but the arbitrator nonetheless issued an award recording the agreed settlement terms. The appellant applied to the Western Cape High Court to have the award made an order of court under s 31 of the Act. The second respondent opposed, arguing that once the parties settled, the arbitrator’s mandate terminated and the award was void. The High Court upheld this argument and set aside the award. The appellant appealed to the Supreme Court of Appeal.

The appeal was upheld with costs. The order of the Western Cape High Court was set aside. The arbitrator’s award dated 10 December 2007 was made an order of court under section 31 of the Arbitration Act, and the second respondent’s counter-application was dismissed with costs.

The case authoritatively establishes that, under South African common law and the Arbitration Act 42 of 1965, arbitrators may validly issue awards on agreed terms following a settlement reached during arbitration. It clarifies that settlement does not automatically terminate an arbitrator’s mandate and aligns South African arbitration practice with international norms, despite the absence of an express statutory provision.