Arbitral award review limited to errors apparent on the face; contractual interpretation and evidence findings were upheld.

An arbitral award was challenged on grounds of misconstruction of sale contracts, lack of jurisdiction over a counterclaim for vehicles removed by the company, absence of evidence, unsupported ground rent, and excessive costs. The Supreme Court stated that judicial interference is confined to limited grounds and that an error of law must appear on the face of the award or an incorporated document; mere disagreement with the arbitrator's construction of evidence was insufficient. It also held that the counterclaim was within the arbitration clause, the findings on the vehicles were supported by oral and documentary material, the ground-rent award disclosed no legal infirmity, and the costs award involved a discretionary assessment with no perversity shown. The award was therefore sustained.

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Issues: (i) Whether the award could be set aside for alleged misconstruction of the sale contracts and related documents as an error apparent on the face of the award; (ii) Whether the umpire lacked jurisdiction to decide the counterclaim relating to the 291 vehicles removed by the company and the connected claim for compensation; (iii) Whether the findings regarding the 600 operational vehicles were vitiated for want of evidence or for acting as a conciliator rather than as an arbitrator; (iv) Whether the award on ground rent was unsupported by evidence; and (v) Whether the award of costs was so disproportionate as to warrant interference.

Issue (i): Whether the award could be set aside for alleged misconstruction of the sale contracts and related documents as an error apparent on the face of the award.

Analysis: The governing rule under the Arbitration Act confines judicial interference to the limited grounds for remission or setting aside, and an award can be disturbed for an error of law only when the error appears on the face of the award or in a document incorporated into it. A mere reference to documents in the evidence does not permit the court to reopen the merits or to examine whether the arbitrator construed those documents correctly. On the facts, the umpire considered the sale-notes, the surrounding correspondence, the subsequent clarifications, and the oral and documentary evidence, and expressly based his conclusion on the whole record. The award did not incorporate the outside documents so as to make their construction part of the award.

Conclusion: The challenge based on alleged misconstruction and error apparent failed.

Issue (ii): Whether the umpire lacked jurisdiction to decide the counterclaim relating to the 291 vehicles removed by the company and the connected claim for compensation.

Analysis: The arbitration clause covered disputes arising under the conditions of contract and in connection with the contract. The umpire had jurisdiction to determine whether the 547 vehicles fell within the sale-note and whether the 291 vehicles removed by the company were covered by the sale. Once he concluded that they were not included, the consequential question of return or compensation for their unauthorized removal was directly connected with the contractual dispute. The counterclaim was therefore co-extensive with the dispute referred and within the clause.

Conclusion: The umpire had jurisdiction to entertain and allow the counterclaim.

Issue (iii): Whether the findings regarding the 600 operational vehicles were vitiated for want of evidence or for acting as a conciliator rather than as an arbitrator.

Analysis: The umpire found that the sale covered only vehicles actually lying in the depot on the relevant dates, and on the evidence held that the operational vehicles taken out of the depot did not fall within the sale. He also found that substantial vehicles had in fact been delivered and that any deficiency had been compensated by delivery of other vehicles. The record disclosed oral and documentary material supporting these conclusions, and there was no basis to characterize the award as speculative or conciliatory.

Conclusion: The findings were supported by evidence and did not justify interference.

Issue (iv): Whether the award on ground rent was unsupported by evidence.

Analysis: The depots were on requisitioned sites and the Government had a statutory liability to pay compensation for those sites. Under the contracts, the company was liable to pay ground rent and related charges that the Government itself had to bear. The objection that the award could stand only if tied to actual governmental payment was rejected, and no material showed that the amount claimed exceeded the liability arising under the arrangements.

Conclusion: The award on ground rent did not suffer from any legal infirmity.

Issue (v): Whether the award of costs was so disproportionate as to warrant interference.

Analysis: The umpire exercised his discretion after considering the parties' statements of expenses, the size of the claims, the volume of evidence, and the length of the hearings. No breach of law or perversity was shown in the exercise of that discretion.

Conclusion: The award of costs did not call for judicial interference.

Final Conclusion: The award was sustained on all substantial grounds raised, and the appellant obtained no relief.

Ratio Decidendi: An arbitral award cannot be set aside for mere error in construction of documents unless the error is apparent on the face of the award or in a document incorporated into it; where the arbitrator acts within the reference and bases findings on evidence, the court will not reappraise the merits.

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