Court affirms arbitration clause validity despite procedural objections, appoints arbitrators to resolve disputes in M/s Jairam and Sons partnership.
The Kerala High Court has allowed an arbitration request filed by Bharat Sursingh Asher and others against Rupa Praveen Asher, marking a significant step in resolving the disputes concerning the family-run M/s Jairam and Sons. The court's decision comes amidst allegations of non-cooperation and management issues that surfaced following the demise of key partners in the firm.
The petitioners approached the court under the Arbitration and Conciliation Act, 1996, seeking the nomination of arbitrators to address issues related to the reconstitution of the partnership deed and management disputes. The partnership firm, operational since 1982, faced management challenges after the deaths of two partners, leading to disagreements over reconstitution and profit-sharing.
Justice S. Manu, presiding over the matter, addressed the respondent's objections regarding the absence of the original arbitration agreement or a duly certified copy. The court held that in cases of private agreements, a "duly certified copy" could include copies attested by the parties or their counsel, noting that non-production of the original does not invalidate the arbitration request if the agreement's existence is undisputed.
Furthermore, the respondent's argument that the arbitration clause was invalid due to specifying an even number of arbitrators was dismissed. The court referenced Section 10 of the Arbitration and Conciliation Act, clarifying that such clauses do not render the agreement unenforceable.
Justice Manu emphasized the limited role of the court under Section 11 of the Act, which is to ascertain the existence of a prima facie arbitration agreement, leaving the merits of disputes to the arbitral tribunal. Consequently, the Kerala High Court Arbitration Center has been directed to nominate two arbitrators to adjudicate the disputes, including jurisdictional and limitation issues, as per the partnership deed's arbitration clause.
The court's decision underscores the flexibility in interpreting arbitration agreements, especially regarding procedural formalities, and reinforces the robustness of arbitration as an alternative dispute resolution mechanism.
Bottom line:-
Arbitration and Conciliation Act, 1996 - An arbitration agreement need not necessarily be a public document; in case of private agreements, a "duly certified copy" can mean copies attested by the parties to the agreement or their counsel, and non-production of the original or a certified copy does not invalidate an arbitration request if the agreement's existence and genuineness are undisputed.
Statutory provision(s):
Arbitration and Conciliation Act, 1996 Sections 7, 10, 11(6A), Scheme for Appointment of Arbitrators by the Chief Justice of High Court of Kerala, 1996
Bharat Sursingh Asher v. Rupa Praveen Asher, (Kerala) : Law Finder Doc id # 2937104
