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13 December 2018
When parties enter into an arbitration agreement, they often do so automatically without thinking that a dispute may occur. In such cases, little attention is given to the need to gather, from the outset, documentary proof of any claims that they may wish to assert in the event of a dispute. Consequently, where a dispute arises and relevant documents have not been signed, but are uncontested by the parties to the dispute, should this affect the admissibility or weight accorded to such documents if they are presented by one or both parties as evidence during the arbitration proceedings? Further, in Nigeria, the Evidence Act 2011 (which ordinarily governs evidentiary matters) has been excluded from applying to arbitration. Should this fact aid or weaken an arbitration claim?
It is widely accepted under the rules of evidence that the party which asserts must prove. Thus, in arbitration – whether domestic or international – each party has the burden of proving its case. However, the silence of one party with regard to a particular assertion made by the other will not render that assertion as true without the provision of proof. In Nigeria, the Arbitration and Conciliation Act (Cap A18 of the Laws of the Federation of Nigeria 2004), distinguishes between domestic and international arbitration. In this regard, Section 57(2) of the act provides that an arbitration is international if:
It is therefore evident from Section 57(2)(d) of the Arbitration and Conciliation Act that parties can agree that their arbitration should be treated as an international arbitration even where the requirements of Section 57(2)(a) to (c) of the act have not been met – such as when the arbitration pertains to two Nigerian companies with places of business in Nigeria and the contract's place of performance is Nigeria.
Any arbitration which does not meet the requirements of Section 57(2)(a) to (d) is a domestic arbitration under Nigerian law.
The Arbitration Rules (set out in the First Schedule of the Arbitration and Conciliation Act) provide rules for discharging the evidentiary burden and apply to both domestic and international arbitration by virtue of Section 53 of the act, except where parties have chosen a different set of rules to govern the arbitration proceedings in the case of international arbitration. In this regard, Article 24(1) of the Arbitration Rules provides that "each party shall have the burden of proving the facts relied on to support his claim or defence".
Within the context of international arbitration, Article 27(1) of the United Nations Commission on International Trade Law (UNCITRAL) Arbitration Rules 2010 is almost identical in providing that "each party shall have the burden of proving the facts relied on to support its claim or defence".
To further highlight the importance of proving facts to support a claim as opposed to just brandishing words and documents without showing any inextricable link to the dispute at issue, Article 25(6) of the Arbitration Rules and Article 27(4) of the UNCITRAL Arbitration Rules provide that "the arbitral tribunal shall determine the admissibly, relevance, materiality and weight of the evidence offered". In making this determination, it stands to reason that all of the circumstances of the particular dispute will be considered. In Nigeria, this will include the specific exclusion of the application of the Nigerian evidence statute – the Evidence Act 2011 – to arbitration. Section 256(1)(a) of the Evidence Act, which contains this exclusion, provides that:
This Act shall apply to all judicial proceeding in or before any court established in the Federal Republic of Nigeria but it shall not apply to –
(a) proceeding before an arbitrator.
In view of the foregoing, the following questions are pertinent:
Under Nigerian law, the general position is that unsigned documents are worthless and have no evidentiary value. Justice Oguntade recognised this when he stated in Garuba v Kwara Investment Co Ltd that "such a document as Exhibit 8, unsigned as it was, is incapable of establishing the fact that 2nd Defendant took over the assets and liability of the 1st Defendant".(1)
Similarly, Seidu v Attorney-General of Lagos State,(2) Abia State V Silas O Agharanya(3) and Anaeze v Anyaso(4) all hold that unsigned documents are worthless and void and have no weight under the law.
Nonetheless, in Union Bank of Nigeria Plc v Charles Olusola Toyinbo,(5) the Court of Appeal restated the Garuba principle that where parties do not dispute the contents of a document, such document will be deemed to be admitted and requires no further proof. This implies that there would be no need to examine the signatures or other contents of such a document to determine its authenticity. Specifically, in Garuba, Justice Agbue held as follows:
Here, the learned Counsel for the Appellant had submitted that Exhibit D relied upon by the Court was an unsigned document by the parties to the suit and ought not to attract weight more so as the Plaintiff failed to lead evidence to the effect that the said Exhibit D was adopted as part of his terms of employment with the Defendant/Appellant… Now, it has to be stressed that like in all other civil cases, the Plaintiff/Respondent who complained of wrongful termination of his employment with Appellant, has the onus to place before the lower Court the terms and conditions of his employment and further demonstrate with concrete and credible evidence how the terms of the agreement have been breached... In the course of eliciting evidence on Oath the only witness for the Appellants when cross examined by counsel for the Respondent had this to say at page 61 of the Record of proceedings thus:-... Exhibit D is the binding agreement between the Plaintiff and the Defendant… Although, the onus was on the Plaintiff to establish his case by placing all the necessary facts before the Court since he would not be entitled to judgment unless he so did, where the said Plaintiff/Respondent anchored his case on the collective agreement which has been admitted by the sole witness of the Defendant/Appellant, the Plaintiff had discharged the burden placed on him and it was left for the Defendant to tender the other contract of service which was entered into on the 7th of March, 1983 but this the Defendant failed to do. He can therefore not be heard to approbate and reprobate particularly as what his witness has done amounted to admission and admission against interest… facts admitted need no further proof... It would therefore amount to unnecessary hair splitting argument to posit as the Learned Counsel for the Appellant has done that the trial Judge was in error to place reliance on Exhibit D to find for the Plaintiff/Respondent. (Emphasis added.)
Similarly, Section 1(1)(c) of the Arbitration and Conciliation Act recognises the existence of an arbitration agreement where such agreement is alleged by one party in its claim and not denied by the other in its defence.
Section 256(1) of the Evidence Act excludes the act from applying to arbitration. However, Section 20 (Hearings and Written Proceedings) of the Arbitration and Conciliation Act, as well as Articles 24 and 25 (Evidence and Hearings) of the Arbitration Rules, provide some latitude for parties and arbitrators to determine rules of evidence that would apply in arbitration. Further, Article 15(1) of the Arbitration Rules permits arbitral tribunals to treat an arbitration in such manner as it considers appropriate, provided that:
Since the Evidence Act contains rules of evidence, it would arguably be possible for an arbitrator to apply the principles contained therein (particularly where the parties do not oppose this) to decide an arbitration without necessarily referencing the Evidence Act as the source and notwithstanding Section 256(1) of the act.
Contractual parties are advised to operate contracts proactively and realistically by anticipating that a contractual dispute could arise. Armed with this reality, parties should arrange their contractual affairs with the mindset that they will need sufficient evidence to assert their claims in the event of a dispute. This would ultimately position such party to have the evidentiary pendulum swing in their favour should any such dispute arise.
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