LEGAL PRINCIPLE: CUSTOMARY LAW – Customary Arbitration – Ingredients for Validity
PRINCIPLE STATEMENT
For there to be a valid customary arbitration, five ingredients must be pleaded and proved, namely: (a) That there had been a voluntary submission of the matter in dispute to an arbitration of one or more persons. (b) That it was agreed by the parties either expressly or by implication that the decision of the arbitrator(s) would be accepted as final and binding. (c) That the said arbitration was in accordance with the custom of the parties or of their trade or business. (d) That the arbitrator(s) reached a decision and published their award. (e) That the decision or award was accepted at the time it was made.
RATIO DECIDENDI (SOURCE)
"For there to be a valid customary arbitration, five ingredients must be pleaded and proved, namely: (a) That there had been a voluntary submission of the matter in dispute to an arbitration of one or more persons. (b) That it was agreed by the parties either expressly or by implication that the decision of the arbitrator(s) would be accepted as final and binding. (c) That the said arbitration was in accordance with the custom of the parties or of their trade or business. (d) That the arbitrator(s) reached a decision and published their award. (e) That the decision or award was accepted at the time it was made."
EXPLANATION / SCOPE
A valid customary arbitration requires five proved ingredients: (1) voluntary submission to arbitration; (2) express or implied agreement to be bound by the decision; (3) arbitration according to the custom of the parties; (4) arbitrators reached and published a decision; (5) decision accepted at the time made. All five must be pleaded and proved. The arbitration must be voluntary—not coerced. The agreement to be bound may be implied from conduct. The custom must be proved. The award must be published. Acceptance at the time is crucial—later acceptance after an unfavourable award does not bind. The party seeking to rely on customary arbitration bears the burden of proving all ingredients. Failure to prove any ingredient invalidates the arbitration. The principle ensures that customary arbitration is not lightly presumed.