Summary
Consultants sought independent arbitrators despite appointments made by the respondent’s Chairman and Managing Director under an exclusive contractual power. The Supreme Court held that an interested person cannot appoint a sole arbitrator, even where that person is not named to arbitrate personally. The invalid appointments did not prevent exercise of the Court’s appointment jurisdiction. With the consortium’s lead member based in New York, the proceedings qualified as international commercial arbitration.
Issues
- Whether the consortium’s arbitration was international commercial arbitration.
- Whether an interested official could exclusively appoint the sole arbitrator although not himself designated to arbitrate.
- Whether appointments already made barred the Court from appointing an independent arbitrator.
Held
- The New York architectural firm remained the consortium’s lead member despite joint and several liability. On the facts, the arbitration satisfied the international-commercial requirement. (¶¶ 7, 8, 9, 10)
- The short delay beyond the agreed appointment period alone did not warrant the Court’s intervention. (¶ 12)
- An interested person’s inability to appoint a sole arbitrator applies even where the contract gives that person only appointment authority. Equal rights of both parties to nominate respective arbitrators present a different situation. (¶¶ 15, 16)
- An appointment that is not ex facie valid cannot be treated as a completed act excluding the Court’s appointment jurisdiction. The existing appointments therefore did not prevent these applications. (¶¶ 21, 22, 23)
- The replacement reflected the legal defect in the appointment mechanism and was not a finding against the appointed arbitrator’s competence or standing. (¶ 26)
Result
All three applications allowed. The respondent’s appointment letters of 30 July 2019 and resulting appointments were annulled. Former Supreme Court Justice A.K. Sikri was appointed sole arbitrator in each matter, subject to statutory independence, impartiality and time-availability declarations. Fourth Schedule fees and other expenses were to be shared equally.