arbitration clause

Summary: The seat of arbitration determines the supervisory jurisdiction of courts over arbitral proceedings. But is the situation always so straightforward? More often than not, the seat is not specified and is coupled with vague references to venue or place, along with conflicting exclusive jurisdiction clauses. What happens in such cases? How is the supervisory jurisdiction of courts determined? Courts have developed nuanced approaches to resolve these conflicts, establishing clearer principles for determining supervisory jurisdiction. This article examines six key and frequently encountered scenarios with recent judicial trend to provide clarity on this complex area of law.Continue Reading Seat, Venue, Place, and Exclusive Jurisdiction Clauses: Analysing the Different Complex Combinations with Recent Judicial Trends

Navigating the MSME Minefield: When Party Autonomy Meets Statutory Reality

Summary: The recent decision in GEA Westfalia highlights the importance of an exclusive jurisdiction clause in contracts involving MSMEs, particularly for determining the court with the jurisdiction to hear challenges to awards passed as part of the mandatory statutory arbitration under the MSMED Act.Continue Reading Navigating the MSME Minefield: When Party Autonomy Meets Statutory Reality

Arbitration jurisprudence in India continues to vacillate when it comes to the interplay between exclusive jurisdiction clause and arbitration clause, particularly in the realm of domestic arbitration. A key challenge lies in determining which Court will have supervisory jurisdiction over arbitral proceedings — especially when the arbitration clause and jurisdiction clause are not in harmony.Continue Reading Reconciling Conflict in Arbitration Clause and Exclusive Jurisdiction Clause

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the arbitration clause in the original agreement entered into between the parties, which resultantly stands amended or superseded.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

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

Can Directors Be Made Parties to Arbitration Proceedings Following the Underlying Rationale of Group of Companies Doctrine? Delhi High Court Explains

Introduction

Agreement to arbitrate – through a clause in a master or a separate agreement – forms the crux of arbitration. Processes like arbitration depend entirely on parties’ written consent to arbitration agreements. Great importance is attached to party autonomy – autonomie de la volonté.[1] This age-old principle continues to be at the centre of any arbitration agreement; however, ascertaining the consent of a party, more specifically a non-signatory party, to an arbitration agreement has been up for debate.Continue Reading Can Directors Be Made Parties to Arbitration Proceedings Following the Underlying Rationale of Group of Companies Doctrine? Delhi High Court Explains

Section 8 of the Arbitration & Conciliation Act, 1996, Does Not Envisage Making of a Separate Application If Due Objection is Made Before the Court to its Jurisdiction

The Hon’ble Delhi High Court in Madhu Sudan Sharma & Ors. v. Omaxe Ltd.[1]recently held that once a party has taken objection in its written statement to the jurisdiction of the Court to entertain the suit due to the presence of the arbitration clause between the parties, it would amount to sufficient compliance of Section 8 of the Arbitration & Conciliation Act, 1996 (“the Act”). The Court also held that once a party extracts an arbitration clause in its written submission to object to the jurisdiction of the Court, a separate application under Section 8 of the Act would not be necessary.Continue Reading Section 8 of the Arbitration & Conciliation Act, 1996, Does Not Envisage Making of a Separate Application If Due Objection is Made Before the Court to its Jurisdiction