Summary
In an arbitration invoked and constituted before the 2015 amendment took effect, the Court restored the contractual appointment of the employer’s CEO as arbitrator. Mere employment did not establish disqualifying bias under the applicable unamended law; no justifiable doubt or timely statutory challenge was established. The High Court had wrongly applied the expanded amended neutrality principles and intervened without the conditions for Section 11(6) jurisdiction.
Issues
- Whether the employer’s CEO could act as contractual arbitrator under the applicable pre-amendment law.
- Whether the High Court could terminate that appointment and direct a replacement procedure.
Provisions considered
- Sections 12 and 13, before the 2015 amendment, Arbitration and Conciliation Act, 1996Governed disclosure, grounds for challenging independence and impartiality, and the prescribed challenge procedure and time. (¶¶ 14–15, 19, 23)
- Section 14, Arbitration and Conciliation Act, 1996The respondent invoked termination of mandate, but the facts did not justify the High Court’s interference. (¶¶ 8, 15, 23–24)
- Sections 11(6) and 11(8), Arbitration and Conciliation Act, 1996The statutory conditions for intervention must first arise; consequential appointment powers should ordinarily respect the agreed procedure, subject to justified exceptions. (¶ 20–22)
Held
- Invocation on 29 July 2015, appointment on 19 August and appearance on 7 October preceded the amendment’s commencement on 23 October 2015. The controversy was therefore governed by the unamended provisions, on the premise accepted by both parties. (¶ 14)
- Under that law, employment alone did not create a presumption of bias. A controlling or dealing role in the particular contract, or direct subordination to the officer whose decision was challenged, could create justifiable apprehension; neither was shown here. Dealing with similar contracts was insufficient. (¶¶ 17–19, 22(A)(i))
- Section 11(8) did not independently permit substitution without a basis for Section 11(6) jurisdiction. Normally the agreed appointment procedure was to be respected; departures required justified circumstances and recorded reasons. Post-amendment statutory ineligibility was a distinct regime. (¶ 20–22)
- There was no established violation of unamended disclosure requirements and no challenge within the prescribed procedure and time. The respondent had participated and sought further time to file its claim. The High Court wrongly imported expanded amended neutrality principles. (¶ 23–24)
Result
Employer’s appeals allowed; contractor’s cross-appeals dismissed. Arbitration under the appointment of 19 August 2015 to proceed according to law; no costs.