MCR Vengesai and Agnes Vengesai (Carrying on business in partnership under the name Vengesai Architects) v Zimbabwe Manpower Development Fund ("ZIMDEF")

The applicant, a firm of architects, entered into a contract with the respondent (ZIMDEF) in 1998 to provide architectural services for the respondent's headquarters. Work was stopped in 2005 after completion and payment for the contract and project stage. Work resumed in 2011 when the applicant rendered further architectural services. A dispute arose in 2014 regarding the calculation of fees for work done in the final stage of the project. The dispute was referred to arbitration and on 17 December 2015, the arbitrator, Mr. Mordecai Mahlangu, handed down an award in favor of the applicant in the sum of $476,093.92. The applicant sought to register the arbitral award in terms of Article 35 of the Arbitration Act [Chapter 7:15]. The respondent filed a counterclaim to set aside the arbitral award in terms of Article 34 of the Act, on the ground that the award was contrary to public policy.

• Whether the arbitral award should be registered in terms of Article 35 of the Arbitration Act
• Whether the arbitral award is contrary to the public policy of Zimbabwe under Article 34(2)(b)(ii) of the Arbitration Act
• Whether the arbitrator erred in finding that the applicant's architectural charges were consistent with The Architects (Conditions of Engagement and Scale of Fees) By-laws, SI 829/1980
• Whether allowing the award to stand would result in unjust enrichment of the applicant
• What constitutes an award 'contrary to public policy' justifying setting aside under Article 34
• Whether a court entertaining an Article 34 application can re-examine the correctness of an arbitral award

1) The respondent's counterclaim is dismissed with costs. 2) The arbitral award of Mr. M. Mahlangu dated 17 December 2015 in the sum of $476,093.92 is registered as an order of the court. 3) The respondent is to pay the costs of the application for registration of the award.

An arbitral award may only be set aside under Article 34(2)(b)(ii) of the Arbitration Act on the ground of public policy where the award goes beyond mere faultiness or incorrectness and constitutes a palpable inequality that is so far-reaching and outrageous in its defiance of logic or accepted moral standards that a sensible and fair-minded person would consider that the conception of justice in Zimbabwe would be intolerably hurt by the award. A court entertaining an application to set aside an arbitral award under Article 34 does not exercise appellate powers and is not concerned with the correctness of the award. The court may not re-examine the evidence, reassess the arbitrator's findings, or substitute its own findings for those of the arbitrator. Mere errors of law or fact by an arbitrator, even if glaring, do not constitute grounds for setting aside an award on public policy grounds. The party seeking to set aside an award on the basis of public policy bears the onus of proving that the award is contrary to public policy, and this onus is onerous with a very high standard of proof. The finality and binding nature of arbitral awards must be respected, and courts are generally reluctant to interfere with arbitrators' decisions except in cases of manifest injustice, illogicality, or moral turpitude.

The court noted that by choosing the arbitration route, the respondent accepted the outcome of the arbitration even if it turned out to be wrong, for as long as the arbitrator followed correct procedures. The motivation for arbitration proceedings is to bring disputes to finality, leaving an aggrieved party with the option to appeal the decision. The court observed that whilst it is accepted that the respondent is a public body dealing with public money, where a public body has contractual obligations, it cannot escape the consequences of a contract or the effect of prescription simply because it is a public body. The concept of caveat subscriptor (let the signatory beware) is equally applicable to public bodies. The court distinguished the case from Pamire & Ors v Dumbutshena NO 2001 (1) ZLR 123 (H), noting that different procedures were used - that case involved review under the High Court Act which permits reassessment of evidence, whereas Article 34 does not allow such an approach. The court also commented that it is plausible to find an award contrary to public policy based on the status of the institution involved, citing Zimbabwe Posts (Pvt) Ltd v Communications and Allied Services Workers' Union of Zimbabwe HH 60-14 where an award likely to drive an employer into liquidation was set aside on public policy grounds.

This case is significant in Zimbabwean arbitration law as it clarifies the limited scope of judicial review of arbitral awards under Article 34 of the Arbitration Act. It reinforces the principle that courts will not set aside arbitral awards merely because they may be wrong in law or fact, and emphasizes the high threshold required to establish that an award is contrary to public policy. The judgment underscores the finality and binding nature of arbitral awards, and confirms that courts entertaining applications under Article 34 do not exercise appellate functions. The case provides important guidance on the distinction between review under Article 34 of the Arbitration Act and review under the High Court Act, and on the proper approach courts should take when dealing with challenges to arbitral awards based on alleged errors of law or fact. It affirms that parties who choose arbitration must accept the consequences of that choice, including potentially unfavorable outcomes, subject only to the narrow grounds for setting aside provided in the Act.