Discuss the provisions regarding the appointment of arbitrators under the Arbitration and Conciliation Act, 1996.

CS Executive · Economic and Commercial Laws · PYQS · June 2017
Discuss the provisions regarding the appointment of arbitrators under the Arbitration and Conciliation Act, 1996.

Answer & Explanation:

Section 11 of the Arbitration and Conciliation Act, 1996 deals with appointment of arbitrators. According to section 11(1) a person of any nationality may be an arbitrator, unless otherwise agreed by the parties. Section 11(2) states that subject to Section 11(6), the parties are free to agree on a procedure for appointing the arbitrator or arbitrators. Section 11 (3) states that failing any agreement referred to in sub-section (2), in an arbitration with three arbitrators, each party shall appoint one arbitrator, and the two appointed arbitrators, shall appoint the third arbitrator who shall act as the presiding arbitrator. Under Section 11 (4) if the appointment procedure in Section 11 (3) applies and- a party fails to appoint an arbitrator within thirty days from the receipt of a request to do so from the other party; or the two appointed arbitrators fail to agree on the third arbitrator within thirty days from the date of their appointment, the appointment shall be made upon request of a party, the Supreme Court or, as the case may be, the High Court or any person or institution designated by such Court. Section 11 (5) says that failing an agreement referred to in Section 11 (2), in an arbitration with a sole arbitrator if the parties fail to agree on the arbitrator within thirty days from receipt of a request by one party from the other party to so agree the appointment shall be made, upon request of a party, by the Supreme Court or, as the case may be, the High Court or any person or institution designated by such Court. Section 11(6) provides that where, under an appointment procedure agreed upon by the parties,- a party fails to act as required under that procedure; or the parties, or the two appointed arbitrators, fail to reach an agreement expected of them under that procedure; or a person, including an institution, fails to perform any function entrusted him or it under that procedure, a party may request the Supreme Court or, as the case may be, the High Court or any person or institution designated by such Court take the necessary measure, unless the agreement on the appointment procedure provides other means for securing the appointment. Section 11(6A) states that the Supreme Court or, as the case may be, the High Court, while considering any application under Section 11 (4) or Section 11 (5) or Section 11 (6), shall, notwithstanding any judgment, decree or order of any court, confine to the examination of the existence of an arbitration agreement. Under Section 11(6B) the designation of any person or institution by the Supreme Court or, as the case may be, the High Court, for the purposes of this section shall not be regarded as a delegation of judicial power by the Supreme Court or the High Court. Section 11 (7) provides that a decision on a matter entrusted by Section 11 (4) or Section 11 (5) or Section 11 (6) to the Supreme Court or, as the case may be, the High Court or the person or institution designated by such Court is final and no appeal including Letters Patent Appeal shall lie against such decision. Section 11 (8) says that the Supreme Court or, as the case may be, the High Court or the person or institution designated by such Court, before appointing an arbitrator, shall seek a disclosure in writing from the prospective arbitrator in terms of section 12(1), and have due regard to- any qualifications required for the arbitrator by the agreement of the parties; and the contents of the disclosure and other considerations as are likely to secure the appointment of an independent and impartial arbitrator. Under Section 11(9) in the case of appointment of sole or third arbitrator in an international commercial arbitration, the Supreme Court or the person or institution designated by that Court may appoint an arbitrator of a nationality other than the nationalities of the parties where the parties belong to different nationalities. Section 11(10) provides that the Supreme Court or, as the case may be, the High Court, may make such scheme as the said Court may deem appropriate for dealing with matters entrusted by Section 11(4) or Section 11(5) or Section 11 (6), to it. Section 11(11) states that where more than one request has been made under Section 11(4) or Section 11(5) or Section 11(6) to different High Courts or their designates, the High Court or its designate to whom the request has been first made under the relevant sub-section shall alone be competent to decide on the request. Under Sub-section 12 (a) where the matters referred to in Section 11 (4), (5), (6), (7), (8) and (10) arise in an international commercial arbitration, the reference to the Supreme Court or, as the case may be, the High Court in those sub-sections shall be construed as a reference to the Supreme Court; and Sub-section 12 (b) provides that where the matters referred to in Sub-section 11 (4), (5), (6), (7), (8) and (10) arise in any other arbitration, the reference to the Supreme Court or, as the case may be, the High Court in those sub-sections shall be construed as a reference to the "High Court" within whose local limits the principal Civil Court referred to in section 2(1)(e) of the Act is situate, and where the High Court itself is the Court referred to in that clause, to that High Court. Section 11 (13) states that an application made under this section for appointment of an arbitrator or arbitrators shall be disposed of by the Supreme Court or the High Court or the person or institution designated by such Court, as the case may be, as expeditiously as possible and an endeavor shall be made to dispose of the matter within a period of sixty days from the date of service of notice on the opposite party. Section 11 (14) says that for the purpose of determination of the fees of the arbitral tribunal and the manner of its payment to the arbitral tribunal, the High Court may frame such rules as may be necessary, after taking into consideration the rates specified in the Fourth Schedule.

Topics: Arbitration and Conciliation Act, 1996

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