Arbitration and Conciliation

Akshay Surendra
PGP-I, Section D
Course: Legal Aspects of Business
Course Instructor: Dr. Lalitha Sreenath

1 Arbitration and Conciliation

 What is Arbitration

 Alternative method of commercial dispute resolution

 Origin – United Nations Commission on International trade Laws
(UNICTRAL)
 Advantages
– Speedier
– Less Expensive
– Privacy
– Choice of language, venue, arbitrators

2 Arbitration and Conciliation

 Arbitration and Conciliation Act 1996

 Part I
– Domestic arbitrations
– International commercial arbitrations

 Part II
– Enforcement of foreign awards

 Part III
– Conciliation

3 Arbitration and Conciliation

 Arbitration Agreement

 Defines when and how two parties should opt for arbitration
 Either
– Arbitration clause in the contract
– Separate agreement
 Acceptable forms
– Document signed by both parties
– Exchange of letters / telex
 Agreement not void in the event of death of a party
 Agreement autonomous of contract
 Suits if there is an Arbitration Agreement

4 Arbitration and Conciliation

 Arbitration Proceedings
 Parties to be treated equally and presented with an opportunity to
present their case (Claim / Statement of Defence)
 Parties decide
– Procedure for submission of evidence and its relevance, admissibility
– Venue, Language, Procedure for hearings
– Applicable Law in case of International Commercial disputes
 Arbitrators decide
– All the above if parties default
– Termination of case on failure of claimant to submit claim
– Treating failure of submission of statement of defence as
acknowledgment of allegations on the part of defendant party
– If expert consultation is required
– Civil Court assistance is required
5 Arbitration and Conciliation
 Applicability of Law

 Domestic Arbitrations
– Substantive Law of India

 International Commercial Arbitrations

– Discussed in the previous slide

 Limitations Act 1963 is applicable to arbitrations and Evidences

Act is not

6 Arbitration and Conciliation

 Awards

 Decision by votes (arbitrators)

 Amount of award as per terms agreed by parties
 Reasons for award must be provided unless agreed upon by
parties
 Interest rate from the time of initiation of arbitration till the making
of the award can be charged
 Costs to cover fees, expenses of the proceedings can be awarded
to a party

7 Arbitration and Conciliation

 Challenging an Award

 Jurisdiction of court
 Time after serving the award
 Invalidity of arbitration agreement
 Improper notification of any of the proceedings
 Award dealt with matters beyond the scope of agreement
 Improperly constituted tribunal
 Applicability of Law
 Conflict with Public Policy

8 Arbitration and Conciliation

 Enforcement of Awards

 Domestic awards
– Once award has become final, it can be executed like any decree of a
civil court
 Foreign Awards
– Foreign awards enforceable in India:
 New York Convention award
 Geneva Convention Award
– Applies to awards made final in a country to which the NY Convention
of Recognition and Enforcement of Foreign Award applies
– The arbitral award and agreement must be produced in court having
jurisdiction over subject mater

9 Arbitration and Conciliation

 Conciliation

 There can be a single conciliator

 Each party submit their statements to the conciliator upon
commencement
 No hard and fast rules on procedure
 Confidentiality a must
 Terms of settlement formulated binding if parties agree on signing
 Settlement proceedings terminate when
– Settlement agreement is arrived at
– Conciliator feels further efforts not justified
– All / One of the parties feel so

10 Arbitration and Conciliation

 Questions

11 Arbitration and Conciliation