arbitration act final

8/3/2019 Arbitration Act Final

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Arbitration Act

Group Members:

Suketu Bhatt PG-10-05

Roshan Gehani PG-10-14

Shishira Hegde PG-10-18

Abhishek Nair PG-10-32

Vaibhav Sarangale PG-10-42


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The Indian Arbitration and Conciliation Act, 1996 the governing arbitration statute in India. It

is based on the Model Law on International Commercial Arbitration adopted by the United

Nations Commission on International Trade Law (UNCITRAL) in 1985. The Arbitration and

Conciliation Act, 1996 has repealed the Arbitration Act, 1940 and also the Acts of 1937 and1961.

(a) "arbitration agreement" means a written agreement to submit present or future

differences to arbitration, whether an arbitrator is named therein or not;

(b) "award means an arbitration award;

(c) "Court" means a Civil Court having jurisdiction to decide the questions forming the

subject-matter of the reference if the same had been the subject-matter of a suit, but does

not, except for the purpose of arbitration proceedings under section 21, include a Small

Cause Court;

(d) "legal representative" means a person who in law represents the estate of a deceased

person, and includes any person who intermeddles with the estate of the deceased, and,

where a party acts in a representative character, the person on whom the estate devolves on

the death of the party so acting;

(e) "reference" means a reference to arbitration.


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TheTypesof Arbitrations

Domestic Arbitration

The procedure for arbitration and jurisdiction are as per the Indian Law and subject to the

jurisdiction of courts in India.

International Arbitration

One of the parties is resident abroad, a company incorporated abroad etc or government

of foreign country.

Foreign ArbitrationArbitration to be conducted abroad.

Institutional Arbitration

As per the most established Arbitral Organization (Indian Council of Arbitration & Indian

Chamber of Commerce and Industry)

Specified Arbitration

Arbitration of disputes in highly specialized areas like construction, high technology and

commodities etc.


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Requirements of an Arbitration Agreement

Act requires that the arbitration agreement must be in writing.

It may be in the form of an arbitration clause in a contract or it may be in the form of a

separate agreement.

An arbitration agreement is in writing, if it is contained in :

(a) a document signed by the parties,

(b) an exchange of letters, telex, telegrams or other means of

telecommunication, providing a record of agreement,

(c) or an exchange of claims and defense in which the existence of the agreement

is alleged by one party and not denied by the other.


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Validity of Arbitration Agreements:y All disputes about property, money or about the amount of damages

payable for breach of contract can be referred to arbitration.

Competency of the Parties (Sec 11 and 12):

y

They should be majors.y They should be of sound mind.

y They are not to be disqualified by the law to which they are subject.

Contents of Arbitration Agreement:

y

If the agreement does not specify and appointment of sole arbitrator isnot made despite notice, appointment should be made by Chief Justice ofHigh court or person designated by him upon request by the party.


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Venue of Arbitration

y Section 20(1) provides that parties may agree on a place ofarbitration.

y

If not agreed arbitral tribunal may determine the venue.y Section 19(1) prescribes in the matter of determination of

venue of international arbitration with a foreign party isheld in India.

y The power of arbitral tribunal includes to determine theadmissibility, relevance and the evidential value of varioussubmission made and documents produced by the parties.


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The parties may by agreement appoint whomsoever they please toarbitrate on their dispute.

They may appoint a single arbitrator or two arbitrators and an umpire ortwo or more arbitrators without any umpire.

The parties may appoint an arbitrator in the following ways:

1) An arbitrator may be named in the arbitration agreement, or

2) He may not be named at all, or

3) It may be agreed that the arbitrator shall be appointed by a third party who

shall be named in the agreement.


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To administer oath to parties and witnesses appearing before him; To state a special case for the opinion of the court on any question of law

or state the award in the form of a special case for the opinion of the court To make the award conditional or in the alternative To correct in an award any clerical mistake or error arising from any

accidental slip or omission To administer any party interrogatories

DutiesDuties ofof ArbitratorArbitrator

Duty to follow rules of natural justice

Duty to act fairly to both parties

Duty not to delegate Duty to decide according to law

Duty not to exceed his authority

Duty to decide all matters referred

Duty to act together

Duty not to accept hospitality


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Modification or Correction of Arbitration Award-

y An application for setting aside award may be made to the court withina period of 3 months of receipt of the award on following grounds.

y Incapacity of the party

y Invalidity of the agreement

y Want of proper notice

y

Award does not pertain to the dispute duly referredy Arbitral tribunal is defective in composition

y Subject matter of dispute is not capable of settlement througharbitration

y Arbitral award is contrary to public policy

Under the Section 82, High court may make the rules consistent with theprovision of the Act for conduct of the proceedings before the court.


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Enforcement of Arbitration Award-

y Enforcement ofDomestic Award (Section 36)-

y Enforcement of Foreign Award under conventions

y Enforcement of awards to which conventions do not apply

Appeals

y The act provides for only one appeal and expressly barssecond appeal excepting the right to appeal to the SupremeCourt.


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Conciliation

y Acts as a catalyst to bring settlement between the parties.

y Conciliation commences when the party accepts in writing invitations ofthe other to conciliation.

Stages in Conciliation Proceedings:

y

They are expected to assist in an independent and impartial manner.y He facilitates steps such as mutual exchange of written statements and

inviting parties to communicate jointly or separately.

y Try to find areas of agreements and try to formulate terms of possiblesettlement.

yThe agreement signed by the parties and authenticated by conciliator shallbe final and binding and has the status of an arbitral award.


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Confidentiality:

y He has to endeavor for a speedy settlement but he is not supposed todisclose confidentiality.

y The views expressed or suggestions made by the parties for a possiblesettlement , admission made by the parties cannot be used in arbitralor judicial proceedings.

Cost andexpense related to Arbitrator:

y Unless agreed by the parties, the costs of an arbitrator shall be fixed bythe Arbitral Tribunal.

y

The party entitled to costs;y The party who shall pay costs;

y The amount of costs or method of determining that amount;

y The manner in which the costs shall be paid.


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Case - ONGC VSSAW Pipes-

y ONGC in June 1996 indented an order of 26 and 30

diameter to SAW pipes Pvt. Ltd.y The order was time critical and was to be delivered byDecember 1996. The quality of product expected waspremium.

y Due to labor strike in Italy SAW pipes failed to deliverthe goods in time and asked for the extension.

y ONGC deducted appox. $ 3,00,000 and $ 15,15,000 asliquidation damages from the final invoice payment.

y The case was taken to arbitral tribunal for unlawfuldeduction of liquidation damages.


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arbitration act final

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