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Heeralal Agarwalla and Co. Vs. Joakim Nahapiet and Co. Ltd. - Court Judgment

LegalCrystal Citation
SubjectArbitration
CourtKolkata
Decided On
Reported inAIR1927Cal391
AppellantHeeralal Agarwalla and Co.
RespondentJoakim Nahapiet and Co. Ltd.
Cases ReferredSassoon & Co. v. Ramdutt Ramkissen A.I.R.
Excerpt:
- .....say further that although this form of association contract has been the subject of consideration by the judicial committee, the present point was never raised before their lordships in that case: see sassoon & co. v. ramdutt ramkissen a.i.r. 1922 p.c. 374. the question now before me is not how the award of the appeal committee may affect, if at all, the rights of the parties who have agreed to be bound by it : it is only whether that award is one to which the provisions of the act can apply, so that it may he filed under the act. for the reasons given i think it is not. to that extent the application is therefore allowed with costs.
Judgment:

Pearson, J.

1. This is an application to take off the file an award made under the rules of the Calcutta Baled Jute Association. The arbitration clause is that of the ordinary printed association contract, which provides for the appointment of the arbitrators and an umpire. Then the concluding words are:

The award made by them respectively, if no appeal therefrom, shall be admitted by the Committee, or the award of the Committeee made on any appeal therefrom as provided, for in the Association rules and by-laws (which is printed on the reverse form part of, this contract,) shall be final.

2. The rules and bye-laws of the Association carried out the scheme of the clause and provided for an appeal to the Committee. Rr. 28 and 29 are as follows:

28. The Committee may at their discretion, and upon payment of the prescribed fees, hear appeals from arbitrators awards provided they proceed in conformity with the, bye-laws of the Association.

29. The award of the Committee in any appeal considered by them confirming, varying or setting aside the award of arbitrators or umpire shall be accepted as finally binding on all parties.

3. The arbitrators failed to agree, whereupon the umpire took the matter up and made an award in favour of the applicant. An appeal, to the Committee resulted in the decision of the umpire being reversed and an award made in favour of the opposite party. It is contended by the applicant that the award of the Committee is not within the terms of the Indian Arbitration Act, and cannot be filed under it. It is argued on the other hand that no such restriction is to be found in the Act, and that the intention of the parties is the deciding factor.

4. It is to be observed that it is only by virtue of Exception 1 to Section 28 of the Indian Contract Act that a contract to refer a dispute to arbitration is saved from the general rule that agreements to oust the jurisdiction of the ordinary Courts are void. The Arbitration Act gives effect to that exception under a certain procedure within the limits laid down by its provisions. It is plain that it does contemplate some latitude being allowed to the parties in certain particulars: Section 6, for example, makes applicable to a submission to arbitration the provisions in the first schedule, 'unless a different intention is expressed' and the same will be found in the language of Sections 9 and 10. It lias indeed been Conceded in argument that by agreement there may be, for instance, a reference to more than two arbitrators, or that the umpire may be a body or committee. But although the intention of the parties may be expressed to exclude the operation of the provisions of the first schedule, the question is whether that intension can prevail so as to bring within the Act an award made by a Committee sitting in appeal over an umpire.

5. The purpose of the Act is to allow of arbitration by agreement, under a procedure provided by it, but subject to certain safeguards and in particular the powers of the Court to supervise or intervene in certain matters. Thus the Court is given important powers after the award is made; it may remit the award under Section 13, or may set it aside under Section 14. According to the language of Sections 10 to 15, which are the important ones for the present purpose, the only persons or tribunals considered as having seisin of the arbitration are the 'arbitrators or umpire.' It is they who are to make the award and cause1 it to be filed under Section 11; to them it may be remitted under Section 13: and for this misconduct it may be set aside under Section 14. These are general sections applying to all a wards under the Act, whether the provisions of the first schedule are applicable to the particular arbitration, or whether they are excluded by the expressed intention of the parties. Unless therefore the meaning of the word 'umpire' itself as used in the Act can be enlarged beyond its ordinary, there is no recognition to be found in the Act for an award by a tribunal superior to the umpire. I think that it would be impassible to hold that 'umpire' meant 'umpire or any higher domestic tribunal upon which the parties may agree.' The word cannot bear such a construction. The result is that this award does not conform to the scheme of the Act, and the parties therefore cannot have the benefit of the other provisions of the Act applicable to awards which do so conform.

6. Reference has been made in argument to the case of In re Keighly Maxsted & Co. and Durant & Co. [1893] 1 Q.B. 405, but so far as the present case is concerned it amounts to no more than this : that there are certain matters in an arbitration where the intention of the parties may be allowed to prevail, and that a body or committee may act in the capacity of umpire. I should only say further that although this form of Association contract has been the subject of consideration by the Judicial Committee, the present point was never raised before their Lordships in that case: see Sassoon & Co. v. Ramdutt Ramkissen A.I.R. 1922 P.C. 374. The question now before me is not how the award of the Appeal Committee may affect, if at all, the rights of the parties who have agreed to be bound by it : it is only whether that award is one to which the provisions of the Act can apply, so that it may he filed under the Act. For the reasons given I think it is not. To that extent the application is therefore allowed with costs.


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