DEFINITION OF ARBITRATION:

Settlement of a dispute (whether of fact, law, or procedure) between parties to a contract by a neutral third party
(the arbitrator) without resorting to court action. Arbitration is usually voluntary but sometimes it is required by
law. If both sides agree to be bound by the arbitrator's decision (the 'award') it becomes a binding arbitration.
The exact procedure to be followed (if not included in the contract under dispute) is governed usually by a
country's arbitration laws, or by the arbitration rules prescribed by the International Chamber Of Commerce
(ICC).

Arbitration is a legal technique for the resolution of disputes outside the courts, wherein the parties to a dispute
refer it to one or more persons (the "arbitrators", "arbiters" or "arbitral tribunal"), by whose decision (the
"award") they agree to be bound. Arbitration in the United States and in other countries often includes
alternative dispute resolution (ADR), a category that more commonly refers to mediation (a form of settlement
negotiation facilitated by a neutral third party). It is more helpful, however, simply to classify arbitration as a
form of binding dispute resolution, equivalent to litigation in the courts, and entirely distinct from the various
forms of non-binding dispute resolution, such as negotiation, mediation, or non-binding determinations by
experts. Arbitration is today most commonly used for the resolution of commercial disputes, particularly in the
context of international commercial transactions and sometimes used to enforce credit obligations. It is also used
in some countries to resolve other types of disputes, such as labour disputes, consumer disputes or family
disputes, and for the resolution of certain disputes between states and between investors and states.
An arbitration agreement is a written contract in which two or more parties agree to settle a dispute outside of
court. The arbitration agreement is ordinarily a clause in a larger contract. The dispute may be about the
performance of a specific contract, a claim of unfair or illegal treatment in the workplace, a faulty product,
among other various issues. People are free to agree to use arbitration concerning anything that they could
otherwise resolve through legal proceedings.

An arbitration agreement can be as simple as a provision in a contract stating that by signing that contract you
are agreeing to arbitration in the case of any future disputes. For example, a business owner can ensure
that potential dispute costs remain low by requiring anyone doing business with them to sign an agreement to
arbitrate instead of litigate--to settle the matter out of court. In the case of more complicated business matters, a
mandatory arbitration clause may be necessary. An arbitration provision in a contract might look like this:

“Upon written request of either Buyer or Seller, any controversy or claim between or among the parties hereto
including but not limited to those arising out of or relating to the Sale, any of the sale documents, or any related
agreements or instruments executed in connection with the Sale, including any claim based on or arising from
an alleged tort, shall be determined by binding arbitration in accordance with the Federal Arbitration Act (or if
not applicable, the applicable state law), the Commercial Arbitration Rules of the American Arbitration
Association, and the “Special Rules” set forth below unless both Lender and Borrower, in their respective sole
discretion, agree in writing to mediate the dispute prior to submitting to binding arbitration. In the event of any
inconsistency, the Special Rules shall control. Judgment upon any arbitration award may be entered in any court
having jurisdiction. Any party to this Agreement may bring an action, including a summary or expedited
proceeding, to compel arbitration of any controversy or claim to which this agreement applies in any court
having jurisdiction over such action. The party that requests arbitration has the burden to initiate the arbitration
proceedings pursuant to and by complying with the Commercial Arbitration Rules of the American Arbitration
Association and shall pay all associated administrative and filing fees.”

DLF Power Limited v. Mangalore Refinery & Petrochemicals Limited & Ors. 2016 SCC Online Bom 5069.
The Bombay High Court in its judgment stated that the arbitration clause does not take away the right of
assignment of a party to a contract if it is otherwise assignable. The Court noted that there is a clear distinction
between assignment of rights under a contract by a party who has performed its obligations thereunder and the
assignment of a claim. The latter is a mere claim which cannot be assigned in law. It was further held in this
case that once the other party has accepted the assignment and had insisted for compliance of rights, duties and
obligations, the assignee steps into the shoes of the assignor and will be entitled to all rights, obligations and
benefits including the arbitration agreement forming part of the said agreement.

ADVANTAGES OF ARBITRATION
Parties often seek to resolve their disputes through arbitration because of the potential advantages over the
courts. Advantages include:

 Unlike in court, parties can select an arbitrator with an appropriate degree of practical experience.
 Arbitration is often faster than litigation in court, and a time limit can be placed on the length of the
process.
 Arbitration can be cheaper and more flexible, more commercial and less formal than court.
 Unlike court rulings, arbitration proceedings and arbitral awards are confidential.
 Unlike in court, there are very limited avenues for appeal of an arbitral award, which limits the duration
of the dispute and any associated liability.
 Due to the provisions of the New York Convention 1958, arbitral awards are generally easier to enforce
in other nations than court judgments.

TYPES OF ARBITRATION

This article sheds light on three different types of arbitration agreement, namely: 1. arbitration clauses; 2.
submission agreements (arbitration deeds); and 3. arbitration agreements incorporated by reference.

1. Arbitration Clause

Many commercial agreements now have an arbitration clause embedded within them. The clause regulates the
method of resolving any possible future disputes. Usually these are standard clauses provided by the institution
which the parties have agreed to use to administer the future dispute. Such clauses should contain, as minimum,
details of (a) the arbitration rules that will govern the proceedings and the institution, if any, which is to
administer the process; the seat, or legal place of the arbitration, the number of arbitrators, and the language of
the arbitration.

A clause lacking in one of these respects may be inoperable or allow the other party to delay the proceedings
whilst the ambiguity is resolved. For example, if the clause does not state the number of arbitrators and no
agreement is made on such issue, this will need to be determined by the institution administering the arbitration)
or, if the parties have not agreed on an institution, the courts of the seat.

If national courts are asked to assist this can waste a significant amount of time and money. In one case handled
by Al Tamimi & Company in Abu Dhabi, the claimant resorted to the national court to seek the appointment of
a sole arbitrator and the court issued a judgment to appoint a sole arbitrator in line with arbitration clause
referred to in the disputed agreement. The agreement specified that the arbitrator shall be one arbitrator to be
mutually agreed to by the parties.

Instead of closing its file the court kept the case on hold by not deciding on the court’s fees which was to be
decided on at later stage. The court essentially adopted the arbitration and treated it as a court-administered
arbitration under the UAE Procedural law, which is not what the parties had agreed to.

The sole arbitrator administered the arbitration and proceeded to issue an award in favor of the claimant, who
then filed a fresh case before Abu Dhabi Court to ratify the award. The Abu Dhabi Court of First Instance
rejected the case on the basis that law applying to court-administered arbitrations had not been followed. Article
213(1) of the UAE Procedural Law provides that the arbitrator should submit the award to the court within 15
days of its issuance, which did not occur. The claimant appealed on the grounds that article 213(1) was not
applicable to this case as the arbitration was agreed to pursuant to the arbitration clause signed before resorting
to court, and so was not a court-administered arbitration. The Court of Appeal confirmed the claimant’s view
and overturned the ruling of the Court of First Instance.

Although eventually this matter was resolved, this case shows how a badly drafted arbitration clause leads to a
series of unwanted obstacles. To avoid similar obstacles, the parties should have agreed that in the event of
disagreement to choose an arbitrator, he will be chosen by the institution to administer the proceedings.

2. Submission Agreements / Arbitration Deeds

We noted that arbitration clauses are made before any dispute arises. Submission agreements however are
agreements to arbitrate made after the dispute has arisen. Submission agreements are also known as ‘arbitration
deeds’, and sometimes as ‘Terms of Reference’ (although as explained below, an arbitration deed or terms of
reference are usually prepared irrespective of whether the agreement is by way of a submission agreement or
arbitration clause).

A submission agreement is less common than an arbitration clause. As they are prepared after the dispute has
arisen, they tend to be much longer than an arbitration clause. A submission agreement will contain details of
the dispute and the issues between the parties, and clearly record that it is being referred to arbitration.

It will then contain the same important details as an arbitration clause, such as the legal seat and number of
arbitrators. A submission agreement which does not clearly state the details of the dispute being referred to the
arbitration may be declared later on as null and void, along with any award made pursuant to it.

Submission agreements can be made during litigation to remove the dispute from the jurisdiction of the court
provided the Court of First Instance has not issued its judgment yet and the pleadings stage is still taking place.

It may be assumed that having an arbitration clause means that there is no need for a submission agreement. The
purpose of a submission agreement is to define and specify the scope of arbitration so as to enable the court –
later on – to ensure that the arbitral award was issued within the limits specified by the parties. It can be argued
that an arbitration clause fulfills this purpose as it limits any arbitration to issues arising from or connected to the
agreement, even though the limits are wide.

UAE Law however is not clear on this. Article 203(3) of the UAE Civil Procedural Law states that the subject
of the dispute must be defined in an arbitration clause or during the examination of the claim, and Article
216(1)(a) provides that an arbitral award can be annulled for lack of an ’arbitration document’. It is not clear if
this means arbitration clause or more substantial document such as a submission agreement.
 It is therefore always recommended that, even though there may be an arbitration clause, that a submission
agreement (usually known in this context as an ‘arbitration deed’ or ‘terms of reference’) be signed in any
arbitration proceedings whether there is an arbitration clause in the disputed contract or not.

3. Arbitration Agreement incorporated by reference

A disputed agreement may not include an arbitration clause. Nevertheless if the agreement refers clearly and
explicitly to another document which does contain an arbitration clause, the arbitration clause will be deemed to
have been incorporated into the main agreement by reference provided the reference is made clearly (such as
under the title of “Dispute Resolutions and Governing Law”). If the referral is vague or subject to conflicting
interpretation, the national courts may retain jurisdiction.

It is common to find this type of arbitration agreement in construction contracts, where the contract may make
reference to standard FIDIFC conditions which contain a standard arbitration agreement. In this regard, the
Court of Cassation stated in one of its judgments that:

“It is sufficient in a construction contract to make a referral, so that in case a dispute arises between the client
and the contractor in respect of the construction contract, it becomes resolved through the general conditions of
construction (FIDIC). This means that the parties agreed to arbitration in respect of all the disputes arising out of
the obligations stated in said contract without the need to refer to the details of such condition, where the referral
to it is sufficient…”
ARBITRATION AGREEMENT
What’s In an Arbitration Agreement?
Before arbitration can go forward, the parties must have agreed to arbitrate the dispute.

Arbitration agreements are usually signed at the beginning of a business relationship – long before there’s a
disagreement. They are often just a few sentences long, and are commonly found near the end of a larger
contract under a heading such as “Arbitration” or “Dispute Resolution.” Employee arbitration agreements may
be buried in an employment contract or employee handbook.
An arbitration clause will typically say that all disputes arising under the larger contract will be submitted to
binding arbitration. Sometimes a contract will say that only certain disputes will be arbitrated.

The agreement may also say how the arbitration will be conducted. It may specify certain arbitration rules, such
as the American Arbitration Association (AAA) rules, and it may say whether there will be one arbitrator or a
panel of arbitrators. The agreement may also specify how the arbitrator will be chosen.

The parties to a dispute may also agree to arbitration after a conflict has arisen, or even after a lawsuit has been
filed.

Advantages of Signing an Arbitration Agreement

 Arbitration is usually faster and less expensive than litigating a case in court.
 Arbitrations are confidential, which means that you will not have to publicly testify. The specifics of your
dispute will not be in the public court records.
 In arbitration, you can choose who will decide your dispute. This can be particularly helpful if you want a
decision maker who has specialized technical knowledge or experience in your industry.
 Some employers will not hire you if you refuse to sign an employment arbitration agreement.

Disadvantages of Signing an Arbitration Agreement

 Arbitration awards cannot be appealed. You must accept the arbitrator’s decision as final.
 You cannot have a jury trial. This can lead to a worse result if you have an employment dispute because juries
are often sympathetic to employees.
 The parties’ exchange of information is more limited in arbitration. This can make it harder to develop your case
in an employment arbitration or in any other situation where the other party has most of the information and
documents.
 If you are asked to agree to arbitration before you even have a dispute, you may not know whether you want to
arbitrate or not. If you sign the agreement and decide later that you would rather pursue a claim in court, you
won’t be able to – or you will rack up legal fees trying to invalidate the arbitration agreement.
 Like all contracts, arbitration agreements can be one-sided in favor of the party who wrote the agreement. You
should be on the lookout for this and make sure the agreement gives you an equal voice in choosing the
arbitrator, does not limit the remedies available to you, and does not deny you the right to an attorney.

Arbitration agreements are a way to limit litigation costs and keep disputes confidential. But signing an
arbitration agreement also means giving up important rights. Before signing, it pays to read arbitration clauses
and reject or renegotiate anything that you’re uncomfortable with.

INTERNATIONAL COMMERCIAL ARBITRATION

International commercial arbitration is a means of resolving disputes arising under international commercial
contracts. It is used as an alternative to litigation and is controlled primarily by the terms previously agreed
upon by the contracting parties, rather than by national legislation or procedural rules. Most contracts contain a
dispute resolution clause specifying that any disputes arising under the contract will be handled through
arbitration rather than litigation. The parties can specify the forum, procedural rules, and governing law at the
time of the contract.

Arbitration can be either “institutional” or “ ad hoc .” The terms of the contract will dictate the type of
arbitration. If the parties have agreed to have an arbitral institution administer the dispute, it is an institutional
arbitration. If the parties have set up their own rules for arbitration, it is an ad hoc arbitration. Ad
hoc arbitrations are conducted independently by the parties, who are responsible for deciding on the forum, the
number of arbitrators, the procedure that will be followed, and all other aspects of administering the arbitration.

The types of law that are applied in arbitration include international treaties and national laws, both procedural
and substantive, as well as the procedural rules of the relevant arbitral institution. Previous arbitral awards carry
persuasive authority, but are not binding. Scholarly commentary, or “doctrine,” may also be applied.
Primary Sources of Arbitration Law

3.1 Treaties
International commercial arbitration treaties have been collected in a number of resources. The Electronic
Information System for International Law (EISIL) maintains a section on International Commercial
Arbitration containing links to the texts of several major treaties and other resources on international
arbitration, including the Convention on the Recognition and Enforcement of Foreign Arbitral Awards, the
European Convention on International Commercial Arbitration, the Inter-American Convention on International
Commercial Arbitration, and the Inter-American Convention on Extraterritorial Validity of Foreign Judgments
and Arbitral Awards. ASIL’s Electronic Resource Guide to International Commercial Arbitration also contains
a section on International Agreements, Conventions, and Treaties that includes links to the texts of a number of
treaties, including regional multilateral and bilateral investment treaties. The International Council for
Commercial Arbitration provides links to regional and international arbitration treaties.
Print resources containing treaty texts and bibliographies include International Arbitration Treaties ( Loukas
Mistelis, et al, eds., 3 rd ed., 2010-), International Commercial Arbitration (Eric Bergsten, ed., 1980-), and
the World Arbitration Reporter: International Encyclopaedia of Arbitration Law and Practice ( Loukas Mistelis
and Laurence Shore, eds., 2010-).

The texts of most multilateral treaties can be found in commercial databases, such as Westlaw and Lexis, or on
treaty depositary websites. See “ An Introduction to Sources for Treaty Research ” by Mark Engsberg and Mary
Beth Chappell, for further information on locating treaty information.

3.2 National Laws

Individual countries have legislation governing both domestic and international arbitration. The International
Council for Commercial Arbitration provides a list of national arbitration laws on its website. ASIL’s Electronic
Resource Guide to International Commercial Arbitration also includes a list of links to all of the national
arbitration statutes that are available on the free web.

A number of print resources include the texts or bibliographies of national arbitration laws,
including International Commercial Arbitration (Eric Bergsten and Clive M. Schmitthoff, eds., 2008-);
the International Handbook on Commercial Arbitration: National Reports, Basic Legal Texts (Peter Sanders, et
al, eds., 2002-); National Arbitration Laws (Loukis Mistelis et al, eds., 2nd ed., 2010-); and the World
Arbitration Reporter: International Encyclopaedia of Arbitration Law and Practice ( Loukas Mistelis and
Laurence Shore, eds., 2010-).

Getting the Deal Through , available in print, by online subscription, or through Bloomberg Law, offers guides
to arbitration in nearly fifty different countries, written by local practitioners. Each chapter includes a brief
listing of the national laws relating both to domestic and foreign arbitral proceedings and to recognition and
enforcement of awards.

Depending on which country’s substantive law the contracting parties have agreed to apply, you will also need
to locate statutes, cases, and other sources of national law. Research guides and other sources, such as
the Foreign Law Guide and the country profiles on GlobaLex, provide assistance with locating a country’s
national laws in print, in commercial databases, and on the free web.

3.3 Arbitration Rules

Arbitration rules are generally available on the relevant arbitral institution's web site. Individual institutions’
rules may also be available in print, either from the institution itself or as part of a larger work discussing the
particular institution and its process. The rules of some of the key international arbitral institutions are also
available through subscription databases such as WestlawNext and Lexis Advance.

A number of print resources have also been created to assist researchers with finding and comparing the rules of
different arbitral institutions. The World Arbitration Reporter: International Encyclopaedia of Arbitration Law
and Practice ( Loukas Mistelis and Laurence Shore, eds., 2010-), contains the texts of various arbitration rules,
as well as their history and background. Comparison of International Arbitration Rules (John J. Kerr, et al,
3rd ed., 2008), offers side-by-side comparisons of provisions from the International Chamber of Commerce, the
American Arbitration Association/International Center for Dispute Resolution, the London Court of
International Arbitration, the Stockholm Chamber of Commerce, the International Center for Settlement of
Investment Disputes, the United Nations Commission on International Trade Law (UNCITRAL), and the
International Institute for Conflict Prevention and Resolution. The comparison is presented in chart format, with
the provisions arranged by topic. International Arbitration Rules: A Comparative Guide (Bridget Wheeler,
2000) discusses the rules of different arbitral institutions at each stage of the arbitration process.

3.4 Arbitral Awards

Unlike litigation proceedings, commercial arbitration proceedings are usually confidential. Decisions, awards,
and other documents relating to arbitration proceedings are generally not published, and there is no centralized
database or publication for researching arbitration proceedings.

An increasing number of arbitral awards, however, can be found in commercial databases. Kluwer Arbitration
and Juris’s Arbitration Law Online are both specialized databases offering collections of arbitral awards texts
and summaries. WestlawNext and Lexis Advance both have arbitration sections containing both domestic and
international arbitration awards. In WestlawNext, this section can be accessed through the Arbitration Materials
link on the main page, which Lexis Advance requires browsing through the topical headings for International
Law, Dispute Resolution, and Arbitration and Mediation. Both platforms offer an online tutorial to assist users
with retrieving arbitration materials. HeinOnline’s Foreign and International Law Resources Database also
contains some arbitral awards, as well as related secondary sources and commentary. Reports of International
Arbitral Awards (RIAA), available in print, in HeinOnline, and on the United Nations website, publishes
arbitration decisions; however, it is limited to disputes between state parties and does not consider disputes
involving private individuals or entities.
Pace Law School’s CISG Database is available on the free web, and integrates arbitral awards into its case law
database. Awards can be found by searching the case law database directly, or by browsing the section entitled
“Legal Materials Organized by CISG Articles.”

Some arbitral institutions publish their decisions on their websites or in print volumes. Publishing of these
decisions is not always comprehensive. Arbitral awards and related commentary can also be found in
international arbitration law yearbooks and journals, such as the ones listed below.

4. Secondary Sources

4.1. Books, Treatises, and Encyclopedias

International commercial arbitration is a burgeoning topic, and numerous books, treatises, encyclopedias, and
other resources have been published both on international commercial arbitration generally and on specific
aspects of international commercial arbitration. Books and other resources can also be found on arbitration in
specific countries or regions and on arbitration in specific industries.

Redfern and Hunter on International Arbitration , now in its 5 th edition, is widely regarded as one of the leading
texts on the law and practice of international arbitration. Though geared toward practitioners and arbitrators,
this source covers both the theory and practice of international arbitration, contains extensive discussion of each
aspect of the arbitration process, and draws upon awards from arbitral institutions around the world to illustrate
its discussions. Most of the material contained in the print resource is also available online through Kluwer
Arbitration.

Gary Born’s International Commercial Arbitration : Commentary and Materials (2d ed.) is another well-known
treatise in international arbitration. It provides an extensive overview of the international arbitration process and
major arbitral institutions, as well as the texts of a number of international arbitration treaties, domestic statutes,
and arbitration rules. International Commercial Arbitration :Commentary and Materials is also available online
through Kluwer Arbitration.

The American Law Institute is currently in the process of drafting the Restatement of the Law Third: The U.S.
Law of International Commercial Arbitration. The project will restate the American law of international
commercial arbitration and is expected to cover, among other topics, arbitration agreements, judicial conduct
and the judicial role in international arbitral proceedings in the United States, arbitral awards, recourse from and
enforcement of international arbitral awards rendered in the United States, the judicial role in international
arbitral proceedings abroad, enforcement of international arbitral awards rendered abroad, the preclusive effect
of international arbitral awards, and ICSID Convention arbitration. Tentative drafts of the Restatement are
available for purchase on the ALI website .

Domke on Commercial Arbitration is a treatise covering all aspects of commercial arbitration, both foreign and
domestic. In addition to scholarly commentary, Domke on Commercial Arbitration contains the texts of a
number of different arbitration rules. It is available as a continually updated loose-leaf service or online through
WestlawNext.

4.2. Arbitration Law Yearbooks

Yearbooks are annual publications intended to provide the reader with updates to the law that have occurred
over the course of the past year. Arbitration law yearbooks may contain articles on new developments in the
law of international arbitration, case notes or texts of arbitral decisions, new legislation and treaties, and other
information.

One of the most prominent publications, the International Council for Commercial Arbitration’s Yearbook:
Commercial Arbitration is available both in print and by online subscription through Kluwer Arbitration. It
includes information on arbitral awards from the International Chamber of Commerce and several other arbitral
institutions, as well as ad hoc awards made under UNCITRAL rules. The Yearbook on International
Arbitration is a relatively new publication covering recent trends in international commercial arbitration, as well
as sports controversies and investor-state conflicts. The AAA Yearbook on Arbitration and the Law , published
by the American Arbitration Association, focuses primarily on United States arbitration and national laws but
also covers international arbitration topics.

Some yearbooks focus exclusively on developments in international arbitration as they related to a particular
country or region. Examples include the Austrian Yearbook on International Arbitration, available in print or
online through Kluwer Arbitration, the Croatian Arbitration Yearbook , available in print or online through
Lexis Academic, and the Czech and Central European Yearbook of Arbitration , also available in print.
Yearbooks dealing with international law in general may also contain information on international arbitration.
These can be found in print or in a variety of commercial databases, including Lexis Advance, WestlawNext,
and HeinOnline.

4.3. Law Journals

Scholarly journal articles on international commercial arbitration can be found using commercial databases and
indexes, such as WestlawNext, Lexis Advance, HeinOnline, and the Index to Foreign Legal Periodicals. There
are a number of journals dealing specifically with arbitration. The following are a few examples.

 American Review of International Arbitration

 Arbitration International
 Arbitration Law Reports and Review
 Arbitration Materials (continued by World Trade and Arbitration Materials )
 Arbitration Review of the Americas
 Asian International Arbitration Journal
 Emory Journal of International Dispute Resolution (continued by Emory International Law Review )
 European & Middle Eastern Arbitration Review
 Global Arbitration Review
 ICC International Court of Arbitration Bulletin
 International Arbitration Law Review
 International Dispute Settlement
 International Journal of Arab Arbitration
 Journal of International Arbitration
 Stockholm International Arbitration Review
 The Asia-Pacific Arbitration Review
 World Arbitration & Mediation Report (continued by World Arbitration & Mediation Review )

4.4. Practice Guides

There are many international arbitration resources that take a practical approach to the topic and that are
therefore well-suited to attorneys and judges who find themselves involved in international arbitration
proceedings.

Redfern and Hunter on International Arbitration , discussed above, is one of the leading texts on international
arbitration, and it is geared toward practitioners and arbitrators. The text covers both practice and theory, and
draws upon past arbitral awards for illustration.

Peter Ashford’s Handbook of International Commercial Arbitration , 2d ed., provides an up-to-date discussion
of each stage of the arbitration process, and comes with a CD-ROM containing sample filings, correspondence,
and other documents to assist practitioners with the arbitration process.

Getting the Deal Through , described above under “National Laws,” offers guides to arbitration in nearly fifty
different countries, written by local practitioners, as well as guides to arbitration under a number of specific
international and regional arbitral institutions. These guides are designed as quick reference sources for
practicing attorneys, and are written in a “frequently asked questions” format.

International Arbitration and Mediation: A Practical Guide , by Michael McIlwrath and John Savage, contains
detailed, straightforward discussions of each step of the arbitration process, as well as the mechanics of
negotiating and drafting an international dispute resolution agreement. Emphasis is placed on early case
assessment and cost analysis, as well as alternatives to arbitration, such as mediation and arb-med. The book
includes model dispute resolution clauses and arbitration documents, as well as an extensive bibliography of
both general and specialized arbitration treatises and materials and a list of websites and other online resources
on arbitration. International Arbitration and Mediation: A Practical Guide is available in print and online
through Kluwer Arbitration.

4.5. Newsletters and Related Publications

One way to stay current on arbitral decisions and developments in arbitration law is by following newsletters,
newsfeeds, blogs, and other similar publications. Many such publications are available, whether in print or
electronic format.

Mealey's International Arbitration Report , available in print and online through LexisNexis, is a monthly
bulletin covering arbitration and related litigation in international and domestic courts world-wide.
TheReport contains articles, news stories, case summaries, attorney listings, and full-text court documents
relating to international arbitration.

The Kluwer Arbitration Blog is published by Wolters Kluwer Law and Business and is available on the free
web. The blog publishes articles on international commercial arbitration, written by experts in the
field.Transnational Dispute Management (TDM) is an online, peer-reviewed journal covering international
arbitration law topics. While a subscription is necessary to access most of the content, there are news posts that
can be accessed without a subscription.

International Dispute Negotiation is a podcast series hosted by the International Institute for Conflict Prevention
and Resolution (CPR Institute.) The podcasts discuss how professionals from different countries and
backgrounds approach dispute resolution, as well as the risks involved in dispute resolution and ways of
mitigating and managing those risks.

The internet contains innumerable blog posts, news feeds, law firm newsletters, and other sources of arbitration
news. General business news sources also frequently publish information on international arbitration
proceedings and related topics.
Composition Of An Arbitral Tribunal

Prior to the Arbitration and Conciliation Act, 1996 (hereinafter called ‘the Act’), the Arbitration Act, 1940
(hereinafter called ‘the 1940 Act’) by virtue of its First Schedule provided-

“1. Unless otherwise expressly provided, the reference shall be to a sole arbitrator.

2. if the reference is to an even number of arbitrators, the arbitrators shall appoint an umpire…”

Thereafter, the UNCITRAL [1] Model on International Commercial Arbitration came into being in 1985, Art.
10 of which says the following regarding the composition of an arbitral tribunal [2] :-

“Number of arbitrators:

The parties are free to determine the number of arbitrators.

Failing such determination, the number of arbitrators shall be three.”

Now, the Indian Parliament realized that the law of the 1940 Act was obsolete and that it could not match up to
the fast developments in the field of global trading; mostly because it could not curtail courts’ intervention,
thereby making the whole arbitration a long drawn process. Thus, it enacted ‘the Act’ in 1996 keeping much in
sync with the spirit of the UNCITRAL Model. In particular, the S.10 of the Act provided the following with
regard to composition of an arbitral tribunal:-

“Number of arbitrators.-

(1) The parties are free to determine the number of arbitrators, provided that such number shall not be an even
number.

(2) Failing the determination referred to in Sub-section (1), the arbitral tribunal shall consist of a sole arbitrator.”
Clearly, the S.10 in the Act is a modification to the Art. 10 of the UNCITRAL Model in the sense that the
default number of arbitrators (in case the arbitration agreement doesn’t provide for the number of arbitrators) is
one in our law while it is three according to the latter. Moreover, in the 1940 Act, the parties by agreement could
agree upon any number of arbitrators; provided that if it was an even number, they were required to appoint an
umpire later on. But the Act has now repealed these provisions and has also abolished the office of the umpire.

At this stage, it is sufficient to bear in mind that both the Act and the UNCITRAL Model sought to bestow
greatest possible freedom to the parties regarding choice of number of arbitrators in the arbitral tribunal; as is
clear from their texts.

overview of the ‘lohia case’

It is widely recognized that the parties are given a great deal of autonomy by the Act wherein they are ‘free’ to
agree by way of an agreement with the other party regarding a gamut of mutual obligations and procedures
under the contingencies contemplated therein. One such important situation is when the parties agree upon the
composition of an arbitral tribunal, i.e., when the parties decide among themselves that a certain number of
arbitrators shall arbitrate a dispute between them at the relevant time.

One such case was that of N.P. Lohia v. N.K. Lohia [3] , the relevant facts of which are as follows:–

The Appellant and the Respondents were family members who had disputes and differences in respect of the
family businesses and properties. Thereafter, each party appointed one arbitrator and then took part in the
arbitration process consisting of these two arbitrators (thus containing an even number of arbitrators). Later, an
award was passed by this tribunal which was challenged by the Respondent before the single Judge of Calcutta
High Court by way of an application to set aside this award.

One of the grounds in the afore-mentioned application was that the Arbitration was by two Arbitrators whereas
under S.10 of the Act there cannot be an even number of arbitrators. It was contended that an arbitration by two
arbitrators was against the statutory provision of the said Act and therefore void and invalid. It was contended
that consequently the Award was unenforceable and not binding on the parties. These contentions found favour
with the High Court which was pleased to set aside the Award. Later, an Appeal against this decision was also
dismissed. Hence, an Appeal was filed with the Supreme Court.

Decision:- It was held that S. 10 of the Act is a derogable provision (despite the word ‘shall’) and that the
arbitral award can be set aside by the Court under S. 34(2)(a)(v) [4] only under the circumstance when the
composition of the arbitral tribunal or the arbitral procedure was not in accordance with the agreement between
the parties. Moreover, it was also held that an arbitral award can be challenged on the ground of composition of
arbitral tribunal only when an objection is first taken before the Tribunal under S. 16(1) of the Act, and the
Tribunal has rejected this objection [5] . The judges were of the opinion that it amounts to a waiver of right
under S. 4 of the Act if such an objection is not raised within the time period specified in S. 16(2) [6] .

Supreme Court Clarifies The Appropriate Jurisdiction For Enforcement Of An Arbitral Award
By a judgment delivered on 15 February 2018 in Sundaram Finance v Abdul Samad & Anr (Civil Appeal No
1650 of 2018), a two Judge bench of the Hon'ble Supreme Court of India (Supreme Court) has clarified the
anomaly with regard to the appropriate jurisdiction for enforcement of an arbitral award. The Supreme Court has
held that enforcement of an Arbitral Award under the Arbitration and Conciliation Act, 1996 (Act) may be filed
in any jurisdiction in the country, for execution, where such decree is capable of being executed and there is no
requirement of obtaining a transfer of the decree from the court which has jurisdiction over the arbitration
proceedings.

Jurisdiction of arbitral tribunals

Competence of arbitral tribunal to rule on its jurisdiction—

1. The arbitral tribunal may rule on its own jurisdiction, including ruling on any objections with
respect to the existence or validity of the arbitration agreement, and for that purpose,—
 a. an arbitration clause which forms part of a contract shall be treated as an agreement
independent of the other terms of the contract; and
b. a decision by the arbitral tribunal that the contract is null and void shall not entail
ipso jure the invalidity of the arbitration clause.
2. A plea that the arbitral tribunal does not have jurisdiction shall be raised not later than the
submission of the statement of defence; however, a party shall not be precluded from raising
such a plea merely because that he has appointed, or participated in the appointment of, an
arbitrator.
3. A plea that the arbitral tribunal is exceeding the scope of its authority shall be raised as soon
as the matter alleged to be beyond the scope of its authority is raised during the arbitral
proceedings.
4. The arbitral tribunal may, in either of the cases referred to in sub-section (2) or sub-section
(3), admit a later plea if it considers the delay justified.
5. The arbitral tribunal shall decide on a plea referred to in sub-section (2) or sub-section (3) and,
where the arbitral tribunal takes a decision rejecting the plea, continue with the arbitral
proceedings and make an arbitral award.
6. A party aggrieved by such an arbitral award may make an application for setting aside such an
arbitral award in accordance with section 34.

Interim measures ordered by arbitral tribunal—

7. Unless otherwise agreed by the parties, the arbitral tribunal may, at the request of a party,
order a party to take any interim measure of protection as the arbitral tribunal may consider
necessary in respect of the subject-matter of the dispute.
8. The arbitral tribunal may require a party to provide appropriate security in connection with a
measure ordered under sub-section (1).

Conduct of arbitral proceedings

Equal treatment of parties—

The parties shall be treated with equality and each party shall be given a full opportunity to present his
case.

Determination of rules of procedure—

1. The arbitral tribunal shall not be bound by the Code of Civil Procedure, 1908 (5 of 1908) or
the Indian Evidence Act, 1872 (1 of 1872).
2. Subject to this Part, the parties are free to agree on the procedure to be followed by the arbitral
tribunal in conducting its proceedings.
3. Failing any agreement referred to in sub-section (2), the arbitral tribunal may, subject to this
Part, conduct the proceedings in the manner it considers appropriate.
4. The power of the arbitral tribunal under sub-section (3) includes the power to determine the
admissibility, relevance, materiality and weight of any evidence.

Expert appointment by arbitral tribunal—

5. Unless otherwise agreed by the parties, the arbitral tribunal may—

a. appoint one or more experts to report to it on specific issues to be determined by the

arbitral tribunal, and
b. require a party to give the expert any relevant information or to produce, or to
provide access to, any relevant documents, goods or other property for his inspection.
6. Unless otherwise agreed by the parties, if a party so requests or if the arbitral tribunal
considers it necessary, the expert shall, after delivery of his written or oral report, participate
in an oral hearing where the parties have the opportunity to put questions to him and to present
expert witnesses in order to testify on the points at issue.
 7. Unless otherwise agreed by the parties, the expert shall, on the request of a party, make
available to that party for examination all documents, goods or other property in the
possession of the expert with which he was provided in order to prepare his report.

Setting Aside An Arbitral Award

Like other ways of dispute settlement, the process of arbitration, to work effectively needs the support of the
system of law. Earlier, the provisions on arbitration were laid down in three different enactments, namely, The
Arbitration Act, 1940, which dealt with the domestic awards, The Arbitration (Protocol And Convention) Act,
1937 and The Foreign Awards (Recognition and Enforcement) Act, 1961, which basically dealt with foreign
awards. [1]

The Arbitration Act, 1940 and also the Acts of 1937 and 1961 were then repealed by The Arbitration and
Conciliation Act, 1996. This modern law seeks to provide for an effective mode of settlement of disputes
between the parties, both for domestic and also for international commercial arbitration.

It is clear an evident that an arbitral award will be binding on the parties. However under section 34 read with
section 37 of the Act it is provided that an arbitral award can be appealed against on limited question of fact and
law. Section 34 lays down the grounds on which an award passed by the arbitral tribunal can be set aside, and at
the same time section 37 enumerates when an award can be appealed against. These include capacity of a party,
invalidity of arbitration agreement, violation of principles of natural justice and the exceeding of terms of
reference by arbitrator. The only residuary ground on which the Court can go into the merits of the award is the
public policy, which is always subject to circumstances and interpretation. [2]

During the course of this paper, the researcher intends to delve into the provisions of the Arbitration and
Conciliation Act, 1996 so as to discover the grounds for setting aside and appeal against an arbitral award and
whether it is sufficient to provide recourse to the aggrieved party.

Interference of the Court

The grounds for objecting an award under section34 and section 37 are now made common to purely domestic
awards as well as international arbitration awards. The principle of least court interference seems fine when it is
applied to international arbitration awards. The same, though, cannot be said with respect to domestic awards as
many a times the awards passed in India are passed by lay men who are not very well acquainted with law.
Thus, unlike with international awards, interference with awards given in domestic matter should not be
restricted. [5]

“Amongst states which have a developed arbitration law, it is generally recognized that more freedom may be
allowed in an international arbitration than is commonly allowed in a domestic arbitration. The reason is
evident. Domestic arbitration usually takes place between the citizens or residents of the same state, as an
alternative to proceedings before the courts of law of that state…it is natural that a State should wish (and even
need) to exercise firmer control over such arbitrations, involving its own residents or citizens than it would wish
(or need) to exercise in relation to international arbitrations which may only take place within the state’s
territory because of geographical convenience.” [6]

The above passage supports the view that in the matter of purely domestic arbitrations between Indian nationals,
the State can desire that its courts should have greater or firmer control on the arbitrations. [7]

Setting aside an arbitral award

In every arbitral proceeding, an arbitrator has to be appointed who finally makes an award which is called the
arbitral award. The contents of the award have to be written and signed by the arbitrator and the reasons for the
award have to be stated unless stated otherwise.

As mentioned above, section 34 provides for provision on the basis of which an arbitral award can be set aside,
and if an award is declared to be void then the whole purpose and object of the act gets nullified. Thus, the
arbitrator has to take extra care while making an award, but how much care should be taken is the question
without the answer.
An appeal to set aside an award has to be strictly made by the aggrieved party within 3 months from the date the
award was received by it. A request can also be made under section 33, provided that the court is satisfied that
there was a sufficient cause for the delay, thereby allowing the appeal to set aside an award to be made within
30 days after the 3 month period. Hence the award should be challenged timely as per the provision of section
34(3) of the Act. [8]

According to section 34(2), an award maybe set aside on the application of an aggrieved party. Under certain
circumstances, the court can set aside the award made by the arbitral tribunal even without an application made
by the party.

The grounds, mentioned in section 34(2) under which a party can make an application to the court to set aside an
award are as follows:

When the party making the application was incapacitated to enter the agreement.

The arbitration agreement, to which the parties are subjected, is not valid under the law.

A proper notice of appointment of arbitrators, or of the arbitral tribunal was not given to the party making the
application.

Arbitral award deals with a dispute not contemplated by the parties or beyond the term of submission.

Composition of the Arbitral Award was not in accordance with the agreement of the parties.

Subject-matter of dispute is not capable of settlement by arbitration under the law for the time being in force.

The arbitral award is in conflict with the public policy of the country.

Once an application of setting aside the arbitral award is preferred under section 34, the executing court has no
jurisdiction to enforce the award, until and unless the application under section 34 is dismissed or refused. This
is a marked departure from even the normal rule under the Code of Civil Procedure, 1908 where an executing
court can execute the decree if there exists no stay by the appellate court. In the opinion of the author, this ought
not to have been the position under the new Act. Enforcement of the award should be permitted unless there is a
stay by the court hearing an application under section 34. [9]

Constitutional Validity of Section 34

In TPI Ltd Vs Union of India [10] , in a writ petition, it was contended by the petitioner that a right to challenge
an arbitral award on merits should be present, and in the absence of the same, section 34 would be
unconstitutional. The court dismissed the write petition and stated that the matter in question was not related to
judicial review of a tribunal decision created under any statute or any administrative action. The arbitration is an
alternate forum for redressal of disputes, and is selected by the parties of their own free will and they agree to
the arbitrator’s decision by means of a mutual agreement or contract, which gives a go by to the normal judicial
forum otherwise available to the parties. There is no compulsion or imposition by any statute compelling the
parties to resort to arbitration if a dispute arises.

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When the parties have chosen the forum of arbitration and the arbitrator of their choice, it is not necessary to
make a provision for appeal against the award rendered by the arbitrator. The legislature has the power to
specify the grounds on which an award can be challenged and it would be permissible for the party to challenge
the award only on those grounds. If it were permissible for the court to re-examine the correctness of the award,
the entire proceedings would amount to a futile exercise. [11]
Interpretation of the term ‘public policy’

It is not possible to precisely define “Public Policy’. Keeping that in mind, the term “Public Policy” has been
interpreted quite liberally by the Indian Courts. Whatever tends to injustice of operation, restraint of liberty,
commerce, natural or legal rights, whatever tends to the obstruction of justice or to the violation of a statute and
whatever is against good moral when made the object of contract is against ‘public policy’, and, therefore, void
and not susceptible to enforcement. [12]

The researcher would like to further elaborate the same point with the help of a few Indian cases where the
courts have had an opportunity to interpret public policy. In Renusagar Power Co. v. General Electric Co. the
hon’ble Supreme Court held that “the expression ‘public policy’ refers to the public policy India and the
recognition and enforcement of the award of the arbitral tribunal in India cannot be questioned on the ground
that it is contrary to the public policy of any other country”. [13]

It has been held in various cases that it is against public policy if the arbitrator is partial or biased towards a
party. Thus the arbitrator is bound:

by the contract between the parties and decide the case in the light of the contractual provision, and to give
proper opportunity to the parties;

to pass the award in accordance with the law so as not to be guilty of misconduct and

to apply mind to crucial questions as non-application amounts to legal misconduct. [14]

The judgment given by the Supreme Court in Oil and Natural Gas Corpn. Ltd. V. Saw Pipes ltd, [15] further
interprets public policy. The court stated that if any award given by the arbitral tribunal violates any provision of
The Arbitration Act, 1996 or is “patently illegal”, then in that case the award could be set aside under section 34
of the said Act. Thus the court has expressly stated that “an award which is, on the face of it, patently in
violation of any statutory provisions cannot be said to be in public interest”. [16]

Enforcement of arbitral award—overview

Produced in partnership with Singhania & Partners

Arbitral award refers to the decision of an arbitral tribunal, whether in a domestic or international arbitration,
including any interim awards thereunder. In India, enforcement and execution of arbitral awards is governed
both by the Arbitration and Conciliation Act, 1996 and the Code of Civil Procedure, 1908.

Subsequent to the amendment of 2015, section 36 of the Arbitration and Conciliation Act, 1996 stands
amended.
One of the declared objectives of the Arbitration and Conciliation Act, 1996 is that every final award is to be
enforced in the same manner as the decree of the Indian court would be. It is upon the losing party to object to
the arbitral award and file an application for setting it aside. However, if the objections to the award are not
sustained or if no objections are filed within the time limit, the award itself becomes enforceable as a decree
of the court.

A domestic award can be challenged and set aside only by way of an application under Arbitration and
Conciliation Act, 1996, s 36 and only the basis of the circumstances listed under it. An application for setting
aside an award must be made within three months of receipt of the award by the applicant subject to a further
extension of 30 days on sufficient cause being shown. An application beyond this period is time barred and
further delay cannot be condoned.
The different types of awards which are enforceable include:
 1. •
Money award
2. •
Award containing injunction
3. •
Declaratory award

Proper forum to approach for enforcement

For the purposes of the Arbitration and Conciliation Act, 1996, ‘court’ means the principal Civil Court having
original jurisdiction to decide the question forming the subject matter of the arbitration, if the same were a
subject matter of a suit. The aggrieved party can, thus, bring its application to set aside the award before the
court where the successful party has its office or where the cause of action in whole or in part arose or where
the arbitration took place.

Time limit

Any application filed under Arbitration and Conciliation Act, 1996, s 34 for setting aside the award must be
made within 3 months from receipt of the same. This period can be extended by the court by a further period
of 30 days on a sufficient cause being shown, but not thereafter. The court normally allows a wide scope to
the meaning of what constitutes ‘sufficient cause’ and if it is convinced of the genuineness of the delay in
filing an application under Arbitration and Conciliation Act, 1996, s 34, the delay is condoned.

Procedure of enforcement

The provision of enforcement of an arbitral award is given under Arbitration and Conciliation Act, 1996, s
36 as mentioned above. The party, after the expiry of the time for setting aside the arbitral award, as
mentioned above, can file an application for execution before the court of the competent jurisdiction for the
enforcement of the arbitral award. For further detail please refer see: Enforcement of arbitral award—
flowchart.

Documents required

The documents required for enforcing an arbitral award are:

1. •
An original award or copy of the award duly authenticated
2. •
Original arbitration agreement or duly certified copy of this
Are there appeals in arbitration?

Most arbitration decisions can be appealed. However, due to the language that the parties often agree to before
entering arbitration, the decisions are usually considered final barring some egregious unfairness in the
arbitration process, and thus are unlikely to be reversed or even reviewed by a court.

Prior to most arbitration hearings, the parties are required to agree that the decision of the impartial third-party
arbitrator will be final– that is, binding and not appealable – no matter the result. This is all part of the process to
incentivize parties to go to arbitration to resolve their disputes rather than suffering through the costs and time
delays of litigation in court. Without such a finality clause, arbitration would turn into a waste of everyone’s
time whenever one party didn’t like the result and decided to walk away from the decision. Of course, the
parties may agree beforehand that the arbitrator’s decision will not be binding, but all parties involved must
specifically agree to this. Otherwise, the default is that arbitration awards are final and binding.
Nonetheless, appeals of arbitration decisions do occur. It’s important to note, however, that a court reviewing
the arbitration decision may never even look to the facts of the case or the merits of the decision, but rather,
judge whether the arbitrator was fair and the final decision was valid – a high standard of deference to the
arbitrator. Actually getting a court to reverse the arbitrator’s decision is extremely rare, as it requires showing
that the decision was so unfair as to be manifestly unreasonable. The willingness of courts to defer to arbitration
awards makes sense, of course, in light of the fact that arbitration hearings relieve the overburdened court
system of hundreds of cases each year.
A key issue becomes when the arbitrator’s award is actually considered final and thus binding on the parties.
The general rule is that arbitration hearings are a one-shot deal, with the final decision coming after the
arbitrator has reviewed the facts from the hearing. It’s not uncommon for some arbitrators to take some time
following the hearing to issue their decision, usually up to a week afterward. Many will issue a written opinion
just as a court would. In these cases, the written opinion counts as the final and binding decision at the time it is
issued. In other instances, an arbitrator will issue the decision on the same day as the hearing. This could happen
if, for example, one of the parties fails to show up for the hearing. Having this happen is unlikely to impact the
finality of any arbitral decision; the hearing is really the only shot you have in arbitration, and missing out will
not make the arbitrator’s decision any less final or binding.

In some cases, it’s necessary for the arbitrator’s award to be submitted to a court of law and confirmed for entry
as a court judgment, making it a legally enforceable decision. This is just part of the arbitration process,
however, and does not mean that the arbitration award is under review. Rather, it simply means that the court is
going through the formal process of entering the arbitrator’s decision.

As the above suggests, arbitration is an integral part of the process of resolving legal disputes. Yet it can also be
risky because of the finality of arbitral decisions and the difficulty in appealing them. For expert advice on
whether arbitration might be the right solution for your legal dispute, contact an experienced arbitration attorney
today.

ENFORCEMENT OF FOREIGN AWARDS IN INDIA

Part II of the Arbitration and Conciliation Act, 1996 (the Act) amended by the Arbitration and Conciliation
(Amendment) Act, 2015 deals with enforcement of certain foreign awards. India recognises foreign awards
under the New York Convention and the Geneva Convention.

1. DEFINITION OF FOREIGN AWARD

According to Section 44 of the Act a foreign award means an arbitral award on disputes arising between parties
to arbitration, whether in contractual or non-contractual relationship, considered as commercial under Indian
laws enacted on or after the 11th day of October, 1960. But the country must be a signatory to the New York
Convention and recognised by the Central Government of India as a Convention country and the award shall be
passed in the territory of another contracting country which is a reciprocating territory, i.e the Central
Government of India has notified it as Convention country in its Official Gazette.
3. FOREIGN AWARD WHEN BINDING

Section 46 of the Act provides that any foreign award which would be enforceable under this Chapter shall be
treated as binding for all purposes on the persons as between whom it was made. It may be relied upon by the
parties in any legal proceedings in India.

5. CONDITION FOR ENFORCEMENT OF FOREIGN AWARDS

1. As per section 48 (1) of the Act, a foreign award may not be enforced in India if it is proved by the party against
whom it is sought to be enforced that:
2. the parties to the agreement were under some incapacity to perform under the law to which they were subjected
to and in the absence of any mention of such law, the law of the country where the award was made, i.e. the
place of arbitration, or,
3. the agreement was invalid under the law to which the parties have subjected it and in the absence of any
mention of such law, the law of the country where the award was made, or,
 a fair trial was not conducted by the tribunal passing the award by failing to adhere to the principles of fair
hearing, or,
1. the award passed was partly or wholly beyond the scope of the arbitration agreement, in which case the part of
the award exceeding the scope of submission to arbitration may be separated from rest of the award, or,
2. the composition of the arbitral tribunal or authority and/or the procedure of its appointment was not in
accordance with the arbitration agreement or in the absence of any mention of the same in the agreement, it was
not in accordance with the law of the country where the arbitration proceedings were held, i.e. the place of
arbitration, or,
3. the award has not yet been made binding on the parties or has been set aside or suspended by a competent
authority of the country which is either the place or seat of arbitration.
The court may call upon such party making an application under section 48 (1) to provide evidence to prove the
existence of any or all of the grounds for refusal of enforcement of award as mentioned above.

1. As per section 48 (2) of the Act, a foreign award may not be enforced in India if it is found by the court in India
that:
2. the settlement of the award is not as per Indian arbitration laws, or
3. the enforcement of the award is contrary to the public policy of India. This defense should be construed
narrowly. It has to be something more than mere contravention of law to attract this defense. An award is said to
be in conflict with the public policy of India if it has been affected by fraud or corruption; or it was in violation
of the of the Act; or it was in contravention with the fundamental policy of Indian law or basic principles of
morality or justice.
Section 48 only provides grounds for refusal of enforcement of foreign award as mentioned in A and B and it
does not permit the court to make a review of the foreign award on the merits of the case; does not permit the
court to exercise its appellate jurisdiction over the foreign award; and does not permit the court to enquire as to
whether some error has been committed by the tribunal while passing the foreign award.

It is further provided that if an application for the setting aside or suspension of the award has been made to a
competent authority, the court may, if it considers it proper adjourn the decision on the enforcement of the
award and may also, on the application of the party claiming enforcement of the award, order the other party to
give suitable security.

6. ENFORCEMENT OF FOREIGN AWARDS

As per section 49 of the Act if a court decides to uphold the foreign award and enforce it then it shall be deemed
to be a decree of the court and no appeal shall lie against the award so upheld except for a discretionary appeal
to Supreme Court of India under Article 136 of the Constitution of India when it is a question of fundamental
importance or public interest. But in the case of an award held to be non-enforceable by the court, an appeal
may be allowed under section 50 (1) (b) of the Act.

The decree shall be executed, on application by the decree-holder, in accordance with the provisions of CPC by
the court which passed it.

CHAPTER II – GENEVA CONVENTION AWARDS

1. INTERPRETATION
As per section 53 of the Act a foreign award is an arbitral award on disputes relating to matters which are
considered commercial under Indian laws enacted after 28th day of July, 1924 and comply with the following
conditions:
 The award is in accordance with the agreement for arbitration to which the Protocol laid down in the Second
Schedule of the Act is applicable;
 The award is with respect to the persons, one of whom is subjected to the jurisdiction of the country which has
been recognised as a Convention party by the Central Government of India vide notification in the Official
Gazette and the other who is subject to the jurisdiction of any other Convention country so recognised by India
through notification in the Official Gazette.
 The award has been made in any of the Convention countries so recognised by the Central Government of India
vide notification in the Official Gazette and the award shall be deemed final only if no legal proceedings or
appeal against such award is not pending in such jurisdictions.

3. FOREIGN AWARD WHEN BINDING

Section 55 of the Act provides that an award which satisfies the conditions of enforceability mentioned under
section 57 of the Act is enforceable and is to be treated as binding for all purposes and also on persons as
between whom it was made. It may be relied upon by the parties in any legal proceedings in India. Any
references to enforcing a foreign award shall be construed as including references to relying on an award.

5. CONDITION FOR ENFORCEMENT OF FOREIGN AWARDS

As per section 57 (1) of the Act, there are certain conditions for enforcement of foreign awards under the
Geneva Convention, such as:

 The award has been passed in accordance with the submission to arbitration by parties;
 The Indian laws of arbitration allow the settlement of the award;
 The award has been passed in accordance with the arbitration agreement by the tribunal or arbitral authority as
determined by the parties mutually and according to the law governing the arbitration;
 The award has become final in the country where it has been passed and no objections or appeal or any other
proceedings are pending against it;
 The enforcement of the award is not contrary to the public policy or the laws of India. An award is said to be in
conflict with the public policy of India if it has been affected by fraud or corruption; or it is in violation of
confidentiality provisions of an attempted conciliation under the Act; or it was in contravention with the
fundamental policy of Indian law or basic principles of morality or justice.
As per section 57 (2) of the Act, a foreign award may not be enforced in India if it is found by the court in India
that:

1. the award has been declared null and void by courts in the country in which it was made;
2. fair trial was not held by the arbitrator, in the sense, that the party was not given a fair opportunity to be heard or
that he was not properly represented by an advocate, pending which the award has been passed;
3. the award is beyond the scope of the submission to arbitration: Provided that if the award has not covered all the
disputes submitted to the arbitral tribunal, the court may either postpone such enforcement or grant it subject to
such guarantee as the court may decide.
Section 57 only provides grounds for refusal of enforcement of foreign award as mentioned in A and B and it
does not permit the court to make a review of the foreign award on the merits of the case; does not permit the
court to exercise its appellate jurisdiction over the foreign award; and does not permit the court to enquire as to
whether some error has been committed by the tribunal while passing the foreign award.

The party against whom the award has been passed, if he proves, that there exists any other ground other than
mentioned above to challenge the validity of the award, then the court, may, either refuse the enforcement of
such award or postpone the proceedings and give the party sufficient time to get the award cancelled by the
competent tribunal.

6. ENFORCEMENT OF FOREIGN AWARDS

As per section 58 of the Act if a court decides to uphold the foreign award and enforce it then it shall be deemed
to be a decree of the court. The Arbitration Act and interpretations by the Supreme Court provide that every
final arbitral award is enforced in the same manner as if it were a decree of the court and as per section 59 of the
Act appeals may lie against the order refusing to refer the parties to arbitration under section 54; refusing to
enforce a foreign award under section 57. Generally, no second appeal shall lie from the order passed in the
appeal under section 58 but right to appeal to Supreme Court is not barred.

MEDIATION AND CONCILIATION

Mediation and Conciliation are two methods of conflicts resolutions in which a third-party is involved. His role
varies from one method to another. Unlike the conciliator who has an active role in the conciliation process (eg
he can propose a solution to end the conflict), the mediator assists the parties throughout the mediation process
to help them find a solution to their dispute by themselves.
Mediation and Conciliation refer to the dispute resolution process in which two or more parties attempt to reach
an amicable agreement with the help of a third party.
There are few differences between mediation and conventional conciliation.
However, judicial mediation and judicial conciliation are governed by different laws.
Article 21 of the CPC provides that “to reconcile the parties is part of the judge’s mission”.
Judicial conciliation is implemented by the judge himself or by a conciliator to whom he will have delegated his
mission to reconcile.
However, judicial mediation is entrusted to a mediator, an external party to the jurisdiction.As provided in
Article 131-1 of the CPC, the judge may appoint the mediator if the parties agree. The conciliation is free for the
parties. Mediation is a chargeable service.

What is Negotiation?

Negotiation is a method by which people settle differences. It is a process by which compromise or agreement is
reached while avoiding argument and dispute.

In any disagreement, individuals understandably aim to achieve the best possible outcome for their position (or
perhaps an organisation they represent). However, the principles of fairness, seeking mutual benefit and
maintaining a relationship are the keys to a successful outcome.

Stages of Negotiation

In order to achieve a desirable outcome, it may be useful to follow a structured approach to negotiation.
For example, in a work situation a meeting may need to be arranged in which all parties involved can
come together.

The process of negotiation includes the following stages:

1. Preparation
2. Discussion
3. Clarification of goals
4. Negotiate towards a Win-Win outcome
5. Agreement
6. Implementation of a course of action
LOK ADALAT AND PERMANENT LOK ADALAT

NALSA along with other Legal Services Institutions conducts Lok Adalats. Lok Adalat is one of the alternative
dispute redressal mechanisms, it is a forum where disputes/cases pending in the court of law or at pre-litigation
stage are settled/ compromised amicably. Lok Adalats have been given statutory status under the Legal Services
Authorities Act, 1987. Under the said Act, the award (decision) made by the Lok Adalats is deemed to be a
decree of a civil court and is final and binding on all parties and no appeal against such an award lies before any
court of law. If the parties are not satisfied with the award of the Lok Adalat though there is no provision for an
appeal against such an award, but they are free to initiate litigation by approaching the court of appropriate
jurisdiction by filing a case by following the required procedure, in exercise of their right to litigate.
There is no court fee payable when a matter is filed in a Lok Adalat. If a matter pending in the court of law is
referred to the Lok Adalat and is settled subsequently, the court fee originally paid in the court on the
complaints/petition is also refunded back to the parties. The persons deciding the cases in the Lok Adalats are
called the Members of the Lok Adalats, they have the role of statutory conciliators only and do not have any
judicial role; therefore they can only persuade the parties to come to a conclusion for settling the dispute outside
the court in the Lok Adalat and shall not pressurize or coerce any of the parties to compromise or settle cases or
matters either directly or indirectly. The Lok Adalat shall not decide the matter so referred at its own instance,
instead the same would be decided on the basis of the compromise or settlement between the parties. The
members shall assist the parties in an independent and impartial manner in their attempt to reach amicable
settlement of their dispute.
Nature of Cases to be Referred to Lok Adalat
1. Any case pending before any court.
2. Any dispute which has not been brought before any court and is likely to be filed before the court.
Provided that any matter relating to an offence not compoundable under the law shall not be settled in Lok
Adalat.
Which Lok Adalat to be Approached
As per section 18(1) of the Act, a Lok Adalat shall have jurisdiction to determine and to arrive at a compromise
or settlement between the parties to a dispute in respect of -
(1) Any case pending before; or
(2) Any matter which is falling within the jurisdiction of, and is not brought before, any court for which the Lok
Adalat is organised.
Provided that the Lok Adalat shall have no jurisdiction in respect of matters relating to divorce or matters
relating to an offence not compoundable under any law.
How to Get the Case Referred to the Lok Adalat for Settlement
(A) Case pending before the court.
(B) Any dispute at pre-litigative stage.
The State Legal Services Authority or District Legal Services Authority as the case may be on receipt of an
application from any one of the parties at a pre-litigation stage may refer such matter to the Lok Adalat for
amicable settlement of the dispute for which notice would then be issued to the other party.
Levels and Composition of Lok Adalats:
At the State Authority Level -
The Member Secretary of the State Legal Services Authority organizing the Lok Adalat would constitute
benches of the Lok Adalat, each bench comprising of a sitting or retired judge of the High Court or a sitting or
retired judicial officer and any one or both of- a member from the legal profession; a social worker engaged in
the upliftment of the weaker sections and interested in the implementation of legal services schemes or
programmes.
At High Court Level -
The Secretary of the High Court Legal Services Committee would constitute benches of the Lok Adalat, each
bench comprising of a sitting or retired judge of the High Court and any one or both of- a member from the legal
profession; a social worker engaged in the upliftment of the weaker sections and interested in the
implementation of legal services schemes or programmes.
At District Level -
The Secretary of the District Legal Services Authority organizing the Lok Adalat would constitute benches of
the Lok Adalat, each bench comprising of a sitting or retired judicial officer and any one or both of either a
member from the legal profession; and/or a social worker engaged in the upliftment of the weaker sections and
interested in the implementation of legal services schemes or programmes or a person engaged in para-legal
activities of the area, preferably a woman.
At Taluk Level -
The Secretary of the Taluk Legal Services Committee organizing the Lok Adalat would constitute benches of
the Lok Adalat, each bench comprising of a sitting or retired judicial officer and any one or both of either a
member from the legal profession; and/or a social worker engaged in the upliftment of the weaker sections and
interested in the implementation of legal services schemes or programmes or a person engaged in para-legal
activities of the area, preferably a woman.
National Lok Adalat
National Level Lok Adalats are held for at regular intervals where on a single day Lok Adalats are held
throughout the country, in all the courts right from the Supreme Court till the Taluk Levels wherein cases are
disposed off in huge numbers. From February 2015, National Lok Adalats are being held on a specific subject
matter every month.
Permanent Lok Adalat
The other type of Lok Adalat is the Permanent Lok Adalat, organized under Section 22-B of The Legal Services
Authorities Act, 1987. Permanent Lok Adalats have been set up as permanent bodies with a Chairman and two
members for providing compulsory pre-litigative mechanism for conciliation and settlement of cases relating to
Public Utility Services like transport, postal, telegraph etc. Here, even if the parties fail to reach to a settlement,
the Permanent Lok Adalat gets jurisdiction to decide the dispute, provided, the dispute does not relate to any
offence. Further, the Award of the Permanent Lok Adalat is final and binding on all the parties. The jurisdiction
of the Permanent Lok Adalats is upto Rs. Ten Lakhs. Here if the parties fail to reach to a settlement, the
Permanent Lok Adalat has the jurisdiction to decide the case. The award of the Permanent Lok Adalat is final
and binding upon the parties. The Lok Adalat may conduct the proceedings in such a manner as it considers
appropriate, taking into account the circumstances of the case, wishes of the parties like requests to hear oral
statements, speedy settlement of dispute etc.
Mobile Lok Adalats are also organized in various parts of the country which travel from one location to
another to resolve disputes in order to facilitate the resolution of disputes through this mechanism.
As on 30.09.2015, more than 15.14 lakhs Lok Adalats have been organized in the country since its inception.
More than 8.25 crore cases have been settled by this mechanism so far.