SOUTH AFRICA Law and Practice Contributed by: Jonathan Ripley-Evans, Fiorella Noriega Del Valle, Veronica Connolly and Kyle Melville, Herbert Smith Freehills Kramer
10. The Award 10.1 Legal Requirements
Tribunals can order specific performance, rectification and injunctions, provided such remedies: • are within the scope of the arbitration agreement; • are within the scope of the dispute referred to them; • do not conflict with South African public policy; and • do not fall outside the scope of an arbitrable dis - pute under South African law. 10.3 Recovering Interest and Legal Costs Recovery of Interest Arbitral tribunals in South Africa can award interest. The rate and period of interest depends on the agree - ment of the parties, the applicable law or the tribunal’s discretion. The South African default position is set out in the Prescribed Rate of Interest Act of 1975, which states that, if the rate at which the interest is to be calculated is not governed by any other law, agreement, trade custom or in any other manner, such interest shall be calculated as follows. • At the South African “repurchase rate” plus 3.5% (currently 10.75%). • Interest shall commence on the following dates: (a) in the case of a liquidated debt – on the date that the debt becomes due; or (b) in the case of an unliquidated debt – on the date on which the creditor sends a demand or takes steps to initiate arbitration proceedings, whichever is earlier. Unless agreed otherwise, “simple interest” is gener - Legal costs are not governed by the IAA; however, they are generally awarded in South Africa based on the principle that costs follow the event (the losing party pays the legal costs of the winning party). None - theless, this is dependent on the agreement of the parties, or on the rules of the chosen arbitral institu - tion. ally utilised. Legal Costs
The IAA contains specific requirements with which an arbitral award in an international arbitration seated in South Africa must comply, as follows. • The award must be in writing (Article 31 (1) of Schedule 1 to the IAA). • The award must be signed by the arbitrator(s). If there is more than one arbitrator, the signatures of the majority are sufficient, provided the reason for any omitted signature is stated (Article 31 (1) of Schedule 1 to the IAA). • The award must state the reasons upon which it is based, unless the parties have agreed that no reasons are to be given or the award is on agreed terms (Article 31 (2) of Schedule 1 to the IAA). • The award must state its date and the place of arbitration as determined in accordance with the agreement of the parties or, failing such agreement, the place determined by the tribunal (Article 31 (3) of Schedule 1 to the IAA). The IAA does not specify a strict time limit for the delivery of the award, unless the parties have agreed otherwise. However, the chosen arbitral institution may have its own rules regarding the timeframe for delivering awards. 10.2 Types of Remedies Arbitral tribunals in South Africa have broad discre - tion when awarding remedies, but certain limitations arise from the risk that the award may be set aside or enforcement refused. The IAA identifies specific cir - cumstances in which an award may be set aside or enforcement refused, as follows: • a tribunal cannot make an award that conflicts with the public policy of South Africa, such as an award of punitive or exemplary damages; • a tribunal cannot make an award where the subject matter of the dispute is not capable of settlement by arbitration, such as liquidation or criminal sanc - tions; and • a tribunal cannot make an award that is outside the scope of the dispute that has been referred to it.
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