Case Note & Summary
The petitioners, a proposed cooperative housing society and its members, entered into a development agreement with the respondent, a developer, for redevelopment of a hutment. Disputes arose, and the respondent appointed an arbitrator unilaterally. The petitioners challenged this appointment under Section 11 of the Arbitration and Conciliation Act, 1996. The court examined the arbitration clause, which required mutual appointment of the arbitrator. Since the respondent appointed the arbitrator without the petitioners' consent, the appointment was invalid. Additionally, the petitioners did not invoke arbitration within the time limit specified in the agreement. Consequently, the petition was dismissed.
Headnote
A) Arbitration Law - Appointment of Arbitrator - Section 11 of Arbitration and Conciliation Act, 1996 - The arbitration clause required that the arbitrator be appointed by mutual consent of the parties. The respondent unilaterally appointed an arbitrator without the petitioners' consent, which was held to be invalid. The court observed that the appointment was not in accordance with the agreed procedure. (Paras 5-7) B) Arbitration Law - Time Limit for Invocation - Section 11 of Arbitration and Conciliation Act, 1996 - The petitioners failed to invoke arbitration within the time stipulated in the development agreement. The court held that the petition under Section 11 was not maintainable as the dispute was not referred to arbitration within the prescribed period. (Paras 8-10)
Issue of Consideration
Whether the appointment of an arbitrator by the respondent-developer was valid under the arbitration clause of the development agreement, and whether the petitioners' challenge to such appointment is maintainable.
Final Decision
The court dismissed the arbitration petition, holding that the appointment of arbitrator by the respondent was invalid, but the petition was not maintainable as the petitioners did not invoke arbitration within the time limit.
Law Points
- Arbitration clause
- appointment of arbitrator
- mutual agreement
- time limit for invocation
- Section 11 of Arbitration and Conciliation Act
- 1996
