The Supreme Court of Mauritius, in Compagnie de Sécurité Privée et Industrielle v Flashbird Limited [2025 SCJ 471], has finally concluded a protracted legal saga that stemmed directly from an ambiguously drafted arbitration clause. Ironically, a clause intended to prevent court disputes instead became the very reason for multiple arbitration proceedings and appeals, ultimately requiring judicial intervention. This case serves as a stark reminder of how a lack of precision in contract drafting can subvert the entire purpose of arbitration, transforming an intended out-of-court mechanism into a prolonged battle in the courts.

Case Background: A Tale of Two Contracts and Two Arbitrations

The core of the conflict was Clause 14 of the contract between Compagnie de Sécurité Privée et Industrielle (“CSPI”) and Flashbird Limited (“Flashbird”), a textbook example of a "hybrid" clause fraught with ambiguity: it first referenced Mauritius's "Cour permanente d’arbitrage a la Chambre de commerce et d’industrie" (the MARC). It then stated that disputes would be settled "suivant le Règlement d’arbitrage de la Chambre de commerce internationale" (the ICC Rules) by "un ou plusieurs arbitres."

This drafting failure ignited immediate conflict. When CSPI initiated arbitration at MARC, Flashbird contested everything: the institution's jurisdiction, the application of ICC Rules, and the appointment of a sole arbitrator. Flashbird's challenges, including one brought before the Permanent Court of Arbitration at The Hague, were rejected. The MARC tribunal, proceeding as a sole arbitrator, found in Compagnie's favour, ordering the résolution judiciaire (retroactive termination under Malagasy law) of the contract.

Crucially, the MARC award explicitly extinguished all contractual effects, stating that the termination served to "anéantir rétroactivement le contrat ainsi que les effets qu’il a produits", thereby voiding any residual obligations, including the payment of an intéressement (success fee).

The Parallel ICC Proceeding and the Supreme Court's Reasoning

In a parallel and tactical move, Flashbird initiated a separate arbitration before the ICC, claiming the intéressement. The Supreme Court's analysis of this ICC award is where it establishes critical legal principles.

Flashbird's case before the ICC was built exclusively on the argument that the MARC award's termination of the second contract had revived the first contract, under which the intéressement was owed. The ICC tribunal, however, took a different path. It rejected Flashbird's revival theory but proceeded to grant the intéressement anyway, basing its award on the second contract - the very contract the MARC had voided ab initio.

The Supreme Court set aside the ICC award on two primary grounds under the International Arbitration Act 2008:

Decision on a Matter Beyond the Scope of Submission (Section 39(2)(a)(iii)): The Court held that the ICC tribunal committed a fundamental error by deciding the case on a basis not pleaded by the claimant. Flashbird submitted its claim based on the first contract; the tribunal awarded damages based on the second. This constituted a clear instance of ultra petita (deciding beyond the request). The Court cited with approval the test from Soh Beng Tee & Co Pte Ltd v Fairmount Development Pte Ltd, requiring a clear connection between the breach and the making of the award.

Inability to Present a Case & Breach of Natural Justice (Sections 39(2)(a)(ii) & 39(2)(b)(iv)): By basing its decision on the second contract without inviting submissions from the parties on this new and pivotal issue, the ICC tribunal deprived CSPI of its right to a fair hearing. The Court emphasized that a breach of natural justice occurs when a tribunal decides a case on a basis "not raised or contemplated by the parties", as this denies them the opportunity to be heard. It found that the outcome "could or might have been different" had CSPI been given this opportunity, especially since the MARC had already definitively ruled on the intéressement under the second contract.

The Court's reasoning is deeply rooted in the principles of the Mauritian Code Civil, notably Article 1134 (agreements are binding law) and Article 1156 (the search for common intention in contract interpretation). The judgment reinforces that arbitral tribunals, like courts, are bound by the parties' pleadings and the fundamental rules of procedural fairness.

Key Takeaways and Broader Implications

This judgment moves beyond a simple cautionary tale about drafting to deliver several profound lessons for arbitration practice:

Precision in Drafting is a Commercial Imperative: The clause's failure to clearly designate a single institution and a definitive number of arbitrators was the original sin. As the Privy Council later noted, the clause pointed towards MARC, but the ambiguity provided fertile ground for years of tactical litigation.

The Sanctity of the Parties' Pleadings and Natural Justice: The Supreme Court has drawn a bright line. An arbitral tribunal's mandate is defined by the dispute as submitted by the parties. Venturing beyond that scope, without notice and an opportunity to respond, is a fundamental breach of due process that will justify the setting aside of an award, regardless of the tribunal's intentions.

Respect for Prior Awards and Finality: The ICC tribunal erroneously claimed the intéressement issue had never been adjudicated. The Supreme Court corrected this, highlighting that the MARC award had extinguished the obligation. The judgment thus upholds the finality of arbitral awards and prevents re-litigation of settled issues under a different guise.

Conclusion: A Precedent for Precision in Mauritian Arbitration

The Compagnie de Sécurité Privée et Industrielle v Flashbird Limited saga is more than a resolved dispute; it demonstrates that the efficiency and finality of arbitration are not inherent qualities but are entirely dependent on the clarity of the foundational agreement.

Going forward, this judgment will serve as a critical reference point for contract drafters, arbitrators, and the Mauritian courts. It reinforces that the principles of the Code Civil -particularly the search for common intention and the binding force of contracts - will be rigorously applied to arbitration agreements. The case sounds a clear alarm against the use of generic, "boilerplate" clauses, urging parties to treat the arbitration agreement not as an afterthought, but as a critical "contract within a contract."

Ultimately, the parties' quest for a private resolution failed because their contract sowed the seeds of public litigation. The enduring lesson of Compagnie de Sécurité Privée et Industrielle v Flashbird Limited is that in arbitration, the path to a swift and final outcome is paved with precise and expert draftsmanship. For Mauritian businesses looking to the future, investing in such precision is not merely a legal technicality; it is a commercial imperative to ensure that their chosen method of dispute resolution remains a true alternative to litigation, rather than becoming its source.