9911796707
TMI Blog1997 (12) TMI 598X X X X Extracts X X X X X X X X Extracts X X X X ..... mission on trunkey basis an oil platform at Bombay High, about 100 miles north-west of Bombay. The contract stipulated the following. "17.0 Laws/Arbitration 17.1 Applicable Laws All questions disputes or difference arising under, out of or in connection with this Contract shall be subject to the laws of Indian. 17.2 Arbitration If any dispute, difference or question shall at any time hereafter arise between the parties hereto or their respective representatives or assigns in respect of the construction of these presents or concerning anything herein contained or arising out of these presents or as to the rights, liabilities or duties of the said parties hereunder which cannot be mutually resolved by the parties, the same shall be referred to arbitration, the proceeding of which shall be held at London, U.K. Within 30 days of the receipt of the notice of intention of appoint arbitrators each party shall appoint an arbitrator of its own choice and inform the other party. Before entering upon the arbitration, the two arbitrators shall appoint an umpire. In case the parties fail to appoint its arbitrator within 30 days from the receipt of a notice from the other party in this beha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed, allowed the petition. The decision rendered by Potter, J. in the Commercial Court is of some importance because the jurisdiction of the English Courts was discussed. The learned Judge said: "Before stating my reasons for that conclusion and then turning to the "frustration" argument, and because questions have arisen as to whether English law or Indian law is appropriate to be applied at various stages of this application, I propose briefly to advert to the various laws potentially applicable to the various aspects of the arbitral relationship which may fall for consideration in cases of this kind. (1) The proper law of the underlying contract i.e. the law governing the contract which creates the substantive rights and obligations of the parties out of which the dispute has arisen. (2) The proper law of the arbitration agreement, i.e. the law governing rights and obligations of the parties arising from their agreement to arbitrate and, in particular, their obligation to submit their disputes to arbitration and to honour an award. This includes inter alia questions as to the validity of the arbitration agreement, the validity of the notice of arbitration, the constitution of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n English or Indian law, because Mr. Dunning has conceded before me that there is no material difference between the two so far as applicable to the doctrine of frustration upon which he relies (see also par. 7 of the affidavit of Mr. Majumdar to that effect). As to (4), the curial law, it seems to me plain that it is the law of England. There is, it is true, no express choice of curial law. However, there is a clear requirement that the arbitration proceedings be held in London. In the absence of express agreement, there is a strong prima facie presumption that the parties intend the curial law to be the law of the "seat" of the arbitration, i.e. the place at which the arbitration is to be conducted, on the ground that is the country most closely connected with the proceedings - see Mustill and Boyd, 2nd ed., p.64." Neither of the parties having filed an appeal from the judgment of Potter, J., its finding bind them. Based upon these findings, it was contended by Mr. S.J.Sorabjee, learned counsel for the appellant, that the petition filed by the first respondent in the High Court at Bombay fell outside the jurisdiction of that Court for a direction to the second respondent to file ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ompetent to control or assistant the arbitration are the Courts exercising jurisdiction at X". The learned Judge observed that there was no reason in theory which precluded "parties to agree that an arbitration shall be held at a place or in country X but subject to the procedural laws of Y". (Emphasis supplied.) In the Law and Practice of Commercial Arbitration in England, Second Edition by Mustill and Boyd, there is a chapter on "The applicable law and the jurisdiction of the Court". Under the subtitle, "Law Governing The Arbitration", it is said, "An agreed reference to arbitration involves two groups of obligations. The first concerns the mutual obligations of the parties to submit future disputes, or an existing dispute to arbitration, and to abide by the award of a tribunal constituted in accordance with the agreement. It is now firmly established that the arbitration agreement which creates these obligations is a separate contract, distinct from the substantive agreement in which it si usually embedded, capable of surviving the termination of the substantive agreement and susceptible of premature termination by ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty of the award; the question whether the parties have been discharged from any obligation to arbitrate future disputes. 2. The curial law governs' the manner in which the reference is to be conducted; the procedural powers and duties of the arbitrator; questions of evidence; the determination of the proper law of the contract. 3. The proper law of the reference governs; the question whether the parties have been discharged from their obligation to continue with the reference of the individual dispute. XXX XXX XXX The conclusion that we reach is that the curial law operates during the continuance of the proceeding before the arbitrator to govern procedure and conduct thereof. The courts administering the curial law have the authority to entertain applications by parties to arbitrations being conducted within their jurisdiction for the purpose of ensuring that the procedure that is adopted in the proceedings before the arbitrator conforms to the requirements of the curial law and for reliefs incidental thereto. Such authority of the courts administering the curial law ceases when the proceedings before the arbitrator are concluded. The proceedings before the arbitrator commence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... en guilty of misconduct. It will also determine what judicial remedies are available to a party who wishes to apply for security for costs or for discovery or who wishes to challenge the award once it has been rendered and before it is sought to enforce it abroad, and the circumstances in which judicial remedies may be excluded." (Emphasis supplied.) Mr. Sorabjee submitted, relying upon the proposition that the procedural law would determine what judicial remedies were available to a party "who wishes to challenge the award once it has been rendered and before it is sought to enforce it abroad", that the court that administered the curial law of the arbitration had the jurisdiction to entertain a challenge to the award and, therefore, the jurisdiction to receive it. The footnote relative to the above proposition (at pave 583) reads thus: "Whitworth Street Estates (Manchester) Ltd. v. James Miller & Partners Ltd. [1970] A.C. 583 (English remedies not available in Scots arbitration)." Mr. Banerjee submitted, and it seems to us, correctly, that the case of James Miller & Partners Vs. Whitworth Street Estates, 1970 A.C. 583, does not bear out the proposition. The facts of the case, s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by any law for the time being in force, the provisions of this Act shall apply to all arbitrations and to all proceedings thereunder" Provided that an arbitration award otherwise obtained may with the consent of all the parties interested be taken into consideration as a compromise or adjustment of a suit by any Court before which the suit is pending." The only other statute which is required to be considered in the context of the provisions of Section 47 of the 1940 Act is the Foreign Awards (Recognition and Enforcement) Act, 1961. For the purposes of determining whether the provision of the 1940 Act are subject to the provisions of the 1961 Act, Section 9 is relevant. It reads thus: "9. Saving - Nothing in this Act shall- (a) prejudice any rights which any person would have had of enforcing in India of any award or of availing himself in India of any award if this Act had not been passed, or (b) apply to any award made on an arbitration agreement governed by the law of India." By reason of Section 9(b), the 1961 Act does not apply to any award made on an arbitration agreement governed by the law of India. The 1961 Act, ther ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
