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by Sarath Malalasekera

The Supreme Court has dismissed an application for leave to appeal made by Oberoi Hotels Pvt Limited in an arbitration matter between the Oberoi and the owning company Asian Hotels Limited.

The Bench comprised Chief Justice Sarath N. Silva, PC, Justice Shirani Bandaranayake and Justice Ameer Ismail.

The petitioner, Oberoi Hotels (Pvt) Limited, India cited Asian Hotels Corporation Limited, Colombo as respondent.

The application for leave to appeal was a sequel to a contested arbitration between Oberoi and Asian Hotels before an Arbitral Tribunal consisting Lord Mustill (Chairman), Sir Michael Kerr and John Beverage QC.

In that arbitration, Oberoi contended that the hotel was not a first class hotel and was not upto the standard of an international hotel and also wanted the hotel to be refurbished fully.

Asian Hotels contended that the hotel was a first class hotel and they were only obliged to refurbish the hotel upto a capacity of US $12.5 million. Asian Hotels also contended that Oberoi were not managing the hotel in the best interest of the owners.

This is clear from the statement made in paragraph 7.22 of the award, which reads: "In retrospect, it is a pity that Oberoi did not respond to the Tribunal's intimation that a formal application would be prudent. In any event, it is doubtful whether such an amendment could have been validly made at that stage."

The application made for leave by Oberoi was thereafter dismissed.

President's Counsel H. L. de Silva with Anil Tittawella and Avindra Rodrigo instructed by Messrs F.J. & G. de Saram appeared for Oberoi Hotels Ltd.

President's Counsel Romesh de Silva with Saumya Amarasekera, Harsha Amarasekera and Sugath Caldera instructed by Messrs Julius & Creasy appeared for Asian Hotels Ltd.

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