BEFORE THE CHENNAI INTEGRATED ARBITRATION

CENTRE

Steve (Claimant)

My Net Co Ltd (Respondent)

Appearance:

Claimant:

1. Sethupathy Rathna Kumar B

2. Jonica E

Respondent:

1. Rahul M
2. Venkateshwara Perumal MP

Issues:

1. Whether the arbitration clause can be invoked?

2. Whether there is breach of contract?

Statement of the case filed by the claimant:

The Claimants argued that the agreement entered into by the claimant and respondent fulfills the
conditions for a valid agreement under S.7 of the Arbitration Act and thus the arbitration clause
can be invoked. The claimants also submitted that there has been breach of terms of contract of
employment. They stated that the respondents violated Clause 12 of the Contract of Employment
whereby they failed to provide prior notice and also that the revocation was in clear
contravention of the company policy. Thus they claimed compensation to the tune of Rs.
10,00,000 which includes loss of employment and also the expenses incurred by the claimant in
bringing the family to Australia.

Respondent’s Statement of defence:

The respondents submitted that Section 39 provides that if a person indulges in any fundamental
breach of the contract and the other party does not acquiesce to the breach, then the party not
breaching is not bound under the liabilities of the contract. This would, therefore, enable a party
to terminate a contract on the ground of substantial failure by the other party which goes to the
root of the contract and thus the arbitration clause cannot be invoked. Clause 12 of the contact of
employment explicitly states that in any event of breach of contract by Mr. Steve of any of the
terms of this employment contract, My Net Co, may terminate employment without notice and
with compensation to Mr. Steve only to the date of said termination. This clause clearly answers
the dispute at hand, Mr. Steve has undisputedly breached the terms of employment and thus
termination of employment without notice is justified. Further, the HR report has evaluated
Mr.Steve as an under-performing employee.

Reasoning and Conclusion:

1. As per the company policy, the employee working for more than 3 years are sent for
onsite office for short or long term on rotational basis.
2. Any onsite offers for more than 3 months are said to be long term.
 3. This issue here is not a breach of contract and so Steve is not to be terminated but only
transferred to different office.
4. Clause 12 is not breached and hence, It is not a breach of contract.

Award

I Ramanah & Rudheresh Khantham are the arbitrators in the arbitration matter between Steve
(claimant) and MyNet Co Ltd (respondent) give my award as under:

1. The Claim of the Claimant for a sum of Rs 10,00,000 against the Respondent is rejected
and the compensation till the period of termination under contract of employment is to be
provided.
2. Also, the expenses for the relocation of Mr. Steve’s family back to India is to be borne by
the company.

Chennai

19-08-19 Rudheresh Khantham Ramanah V

(Arbitrators)