The Supreme Court recently refused enforcement of a foreign award on the basis that it was contrary to the fundamental public policy of India. Although a recent decision, the dispute arose almost 40 years ago and thus pertains to an era which preceded the amendment of the Arbitration and Conciliation Act. In its decision, the court analysed the concept of public policy and the difference between contingent contracts and frustration as a principle for voidability of contracts under the Contract Act.
If the parties to a contract fail to choose the applicable law, the task trickles down to the arbitral tribunal. This will be one of the first tasks required of an arbitral tribunal, as adjudication of a dispute is not possible until the applicable law has been determined. Further, the application of an incorrect law is a ground for setting aside an arbitral award. This article examines the role of an arbitral tribunal in determining the applicable law in arbitration proceedings.
The concepts of 'seat' and 'venue' in the context of arbitration law have been the subject of numerous landmark rulings in India. However, the test for distinguishing between these two concepts has yet to be settled under Indian law. In order to avoid confusion, inconvenience or conflicting decisions in the future, this issue must be referred to a larger bench of the Supreme Court as soon as possible for its final word on the matter.
The division bench of the Bombay High Court recently confirmed the legal position and the tests for determining whether a partial final award may be interpreted as an arbitral award under the Arbitration and Conciliation Act. In so doing, it also clarified the position on the limitation period for challenging such an award.
Following the passing of amendments in 2015, the Arbitration and Conciliation Act specifically provides that arbitral tribunal orders which are passed under Section 17 of the act will be enforceable under the Code of Civil Procedure as if they were a court order. However, a party can take advantage of Section 17 only when the arbitration is seated in India, which raises questions as to the enforceability of interim measures granted by arbitral tribunals which are situated outside India.
The Supreme Court recently held that the courts cannot appoint an arbitrator on the basis of an arbitration clause if the agreement containing such clause is insufficiently stamped. The court concluded that such an arbitration clause does not exist in law. In so doing, the court expressly overruled a prior decision of the Bombay High Court to the extent that it dealt with the powers of the courts under Section 11 of the Arbitration and Conciliation Act.
The Supreme Court recently decided key issues relating to the interpretation of arbitration clauses and the scope of appealable orders under the Arbitration and Conciliation Act. This judgment does an admirable job of resolving residual ambiguities regarding the issue of exclusive jurisdiction where the seat of an arbitration is situated. Notably, through its decision, the Supreme Court has specifically declared that its earlier judgment in Hardy Exploration and the Delhi High Court's decision in Antrix are incorrect.
The Supreme Court recently considered whether an unconditional stay can be granted under Section 36 of the Arbitration and Conciliation Act 1996 when the applicant is the government. The court rightly held that the safeguards which were incorporated for the Crown by Order 27, Rule 8A of the Code of Civil Procedure are now inapplicable and outdated, especially as the purpose and intent of alternate dispute resolution is to treat parties equally.
The division bench of the Supreme Court recently held that if the parties to an arbitration have agreed an arbitrators' fee schedule, the arbitrators must charge their fees in accordance with this agreed schedule and not in accordance with the Fourth Schedule of the amended Arbitration Act. While this decision gives credence to party autonomy and may thus be hailed as pro-arbitration, it specifies no limits and provides no other directions for parties to bear in mind when fixing a fee schedule.
It is common knowledge that arbitration provides greater flexibility and party autonomy compared with traditional litigation before the courts. Corollary to this, the agreed terms for the appointment of an arbitrator or arbitral tribunal must be strictly followed while making such appointments if a dispute arises between the parties to an agreement. However, what happens when an arbitrator fails to or is prevented from acting specifically at the penultimate stage?
The question of whether a contract can be amended retroactively was raised in the arbitration proceedings between Ssangyong and the National Highways Authority of India. The Supreme Court's ruling on the case is a welcome exposition on the contours of Section 34 of the Arbitration and Conciliation Act, especially in relation to challenges on grounds of violations of principles of natural justice.
In 2013 the Supreme Court held that the enforcement of a foreign arbitral award can be refused only if it is contrary to, among other things, the 'fundamental policy of Indian law'. This article focuses on the Indian courts' interpretation of this term and looks at a common question that arises in relation to this area of law – namely, whether a foreign arbitral award which is a mere violation of an Indian legal provision qualifies as a contravention of the fundamental policy of Indian law.
The Supreme Court recently ruled that consumer disputes are incapable of being submitted to arbitration, placing them in the infamous category of 'non-arbitrable' subjects in India. However, the court also stated that where an elected consumer fails to file a consumer complaint, the parties are not barred from submitting the dispute to arbitration. This article analyses whether such a statement could have far-reaching implications for arbitrability as a ground for challenging an award.
The focus of India's rapidly evolving arbitration regime appears to be concentrated on factors such as ensuring that arbitrations are completed in a timely manner and appointed arbitrators are impartial. While these factors are significant, the importance of substantive and procedural clarity in terms of what happens after an award is passed is also crucial.
Two-tier arbitration clauses or appellate arbitration mechanisms were upheld by a three-judge bench of the Supreme Court in Centrotrade Minerals and Metal Inc v Hindustan Copper Limited. This article discusses the evolution of the jurisprudence surrounding two-tier arbitration in India and analyses both the utility of such a mechanism for the parties and its usefulness in certain situations.
The Supreme Court recently held that the only prerequisite for an arbitration agreement is that it be in writing. Through this decision, the court has adopted a pro-arbitration approach and, as such, may contribute positively to the existing jurisprudence on the Indian arbitration regime. By relying on the unsigned bill of lading, the court focused on the parties' conduct and intent, both of which indicated that there was an arbitration agreement between them.
The Bombay High Court recently issued a landmark ruling regarding third parties' right to challenge interim measures granted by an arbitral tribunal under the Arbitration and Conciliation Act. The ruling is a welcome reprieve for non-signatories to arbitration proceedings in situations where disputes between arbitrating parties have a bearing on their rights and interests, as well as a step towards balancing innocent parties' interests.
Before its amendment in 2015, the Arbitration and Conciliation Act 1996 neither promoted institutional arbitration nor discouraged parties from considering it. The 2015 amendment was an attempt to reduce judiciary intervention in arbitration proceedings and promote a culture of institutional arbitration. One of the proposed changes was the amendment to Section 11 of the 1996 act, which provides for the appointment of arbitrators by the competent court.
Following the enforcement of the Arbitration and Conciliation (Amendment) Act 2015, the Arbitration and Conciliation (Amendment) Bill 2018 proposes to further amend the Arbitration and Conciliation Act 1996. The bill is another step by policymakers towards making India "a robust centre for international and domestic arbitration" and attempts to make it an investor-friendly jurisdiction and a preferred seat of arbitration for dispute resolution.
The Bombay High Court recently held that in accordance with the 2015 amendment of Section 11 of the Arbitration and Conciliation Act 1996, the courts' responsibility to refer a dispute to arbitration is narrow and limited to examining the existence of an arbitration agreement. Further, the high court held that an unstamped document does not bar a dispute from arbitration.