Unlocking Arbitration Clauses: Incorporation by reference in digital contracts

Introduction

The question of incorporation of arbitration clauses referred to in another document has been a bone of contention between parties, in view of the absence of statutory guidance under Section 7 of the Arbitration and Conciliation Act, 1996 (“Arbitration Act”). Although the principle of incorporating an arbitration clause, referred to in another document is a well-established principle in arbitral jurisprudence,[1] Section 7(5) only provides that the reference should be “such as to make that arbitration clause part of the contract”. Hence, it has been left to the courts to determine the conditions that need to be satisfied for the same.Continue Reading Unlocking Arbitration Clauses: Incorporation by reference in digital contracts

Rohan Builders Judgment: A Watershed Moment in Indian Arbitration Law

The Supreme Court’s (“SC”) recent[1]interpretation of the intent and scope of Section 29A of the Arbitration and Conciliation Act, 1996 (“Act” or “Arbitration Act”) has sent ripples through the Indian arbitration landscape. In this landmark verdict, Justices Sanjiv Khanna and R. Mahadevan have provided much-needed clarity and guidance on the extension of time limits for arbitral awards beyond the stipulated timeframe under Section 29A of the Act.Continue Reading Rohan Builders Judgment: A Watershed Moment in Indian Arbitration Law

Novation of Contract and Section 11 Of the Arbitration and Conciliation Act, 1996

The doctrine of severability dictates that the arbitration clause (arbitration agreement) is deemed to be separate or independent from the overarching contract. Therefore, even when a contract’s legality is challenged, the arbitration agreement remains unaffected. However, the novation of a contract, by way of a supplemental/amended agreement, raises an interesting question regarding the validity of the arbitration clause in the original agreement entered into between the parties, which resultantly stands amended or superseded.  The issue about the extent to which the courts can intervene to determine this also requires judicial consideration.Continue Reading Novation of Contract and Section 11 Of the Arbitration and Conciliation Act, 1996

The Evolving Landscape of Pre-Reference Interest in Indian Arbitration Regime

The recent ruling by the Supreme Court of India in Pam Developments Private Limited v. The State of West Bengal & Anr.[1] has reignited discussions on awarding pre-reference interest in arbitration proceedings. The case had arisen from a dispute over delays in a road construction project. Marking a significant development in the evolution of the Indian arbitration law, particularly on granting interest, the Court upheld the arbitrator’s authority to award interest on the awarded sum from the date of the cause of action until the date of the award, even when the contract was silent on the matter. While analysing the Pam Developments case, this blog delves into the nuances of pre-reference interest in light of the existing legal framework and relevant jurisprudence.Continue Reading The Evolving Landscape of Pre-Reference Interest in Indian Arbitration Regime

Can an Arbitral Tribunal’s Mandate be Extended Post Award?

Introduction of Section 29A to the Arbitration and Conciliation Act, 1996 (the “Act”), by way of an amendment in 2015, marked a significant event in the arbitration regime in India. It recognised the sluggishness that had crept into arbitration proceedings and provided for strict timelines for making of an award. The section was further amended in 2019, pursuant to recommendations of Justice B N Srikrishna committee.Continue Reading Can an Arbitral Tribunal’s Mandate be Extended Post Award?

Can damages be awarded based on a guess?

A division bench of the Delhi High Court in Cobra Instalaciones Y Servicios, S.A. & Shyam Indus Power Solution Pvt Ltd. v. Haryana Vidyut Prasaran Nigam Ltd. (“HVPNL”)[1] (“Cobra Case”)upheld the quantification of damages by an arbitrator through “honest guesswork” or a “rough and ready method” since it was difficult to quantify the precise amount of loss suffered by the party.

In this blog, we examine the rough and ready approach under Indian law for quantifying damages.Continue Reading Can damages be awarded based on a guess?

Arbitrability of Disputes: Indian Jurisprudence

[Continued from Part I]

The Vidya Drolia Case: Redefining Arbitrability

In 2019, aiming to solve the conundrum and marking a significant milestone in Indian arbitration, the Supreme Court’s ruling in Vidya Drolia and Ors v. Durga Trading Corporation,[1] (“Vidya Drolia”) laid down the contours of arbitrability. While analysing thearbitrability of Landlord-Tenant disputes governed by the Transfer of Property Act, 1882 (“TPA”), the Supreme Court elucidated that the mere existence of a special statute dealing with certain disputes does not ipso facto render them non-arbitrable, thereby widening the scope of arbitrability and increasing the access to arbitration in complex legal contexts. Continue Reading Arbitrability of Disputes: Indian Jurisprudence (Part 2)

The “modification” conundrum: Sticking to the path of least interference – Part I

Introduction

In matters of arbitration, courts are ordinarily required to adopt a hands-off approach while scrutinizing arbitral awards. This jurisprudence has evolved to a point where minimal interference with awards is seemingly the principle guiding courts in India. Against this backdrop, the Supreme Court (“SC”) is going to consider the question whether the powers under Section 34 of the Arbitration and Conciliation Act, 1996 (the “Act”), extend to the modification of arbitral awards or are limited only to the setting aside of arbitral awards. Central to this question is the role of the courts as envisaged under the Act. Continue Reading The “modification” conundrum: Sticking to the path of least interference – Part I

Unravelling the Distinction between ‘Reference to’ and ‘Incorporation of’ Arbitration Clauses

Introduction

While entering into a transaction, companies often invoke multiple standard terms from other agreements, instead of reproducing all applicable terms in a single contract. Such clauses are not set out in the main contract signed by the parties, but are instead found in separate, pre-existing documents that have been referred to in the main contract, by which the parties agree that the standard terms that have been mentioned, should be considered a part of the main contract. This practice enables faster and smoother implementation of contracts and allows some standard clauses to remain unchanged, thus providing greater certainty to business. However, if the arbitration clause itself is located in a secondary document, it might lead to a dispute (between the parties) regarding the appropriate dispute resolution procedure.Continue Reading Unravelling the Distinction between ‘Reference to’ and ‘Incorporation of’ Arbitration Clauses

Demystifying Deadline Dilemmas: Analysing the limitation period of Section 11(6) Petitions in Arbitral proceedings in India

INTRODUCTION

Superior courts in India have ratified the stringent deadlines for the various stages in arbitration proceedings, aiming to position India as an arbitration hub. However, it is crucial to establish safeguards to prevent delays in the adjudication process from discouraging the parties’ decision to engage in arbitration. The absence of a prescribed limitation period in certain key provisions of the Arbitration and Conciliation Act, 1996 (“A&C Act”), could be a contributing factor to some of these delays.Continue Reading Demystifying Deadline Dilemmas: Analysing the limitation period of Section 11(6) Petitions in Arbitral proceedings in India