SC: Arbitration agreements must be adhered to by the parties
March, 21st 2008
The Supreme Court ruled last week that if the parties to a contract agree on the arbitrator, the place of arbitration and the court for deciding disputed questions, these should be adhered to.
Dismissing the arbitration petition of Shivnath Rai Harnarain (India) Ltd for appointment of a mediator in terms of Section 11(6) of the Arbitration and Conciliation Act, the arbitration judge noted that the parties chose Samuel Marshal as the arbitrator and the venue as Singapore. His award in favour of the firm was set aside by a Singapore court.
The firm then moved the Supreme Court for appointment of an arbitrator. The court rejected this as the arbitration on agreed terms was held in Singapore and the court there passed the order. Therefore, it cannot turn around now and ask the Indian court to appoint an arbitrator.