Appointment of Arbitrator

How the arbitrator is appointed?

Who appoint the arbitrator?

What is the procedure for appointing the arbitrator?

Arbitrator

Appointment of Arbitrator: Arbitration is a process in which a dispute is settled between parties outside the Court. An Arbitrator is a person who settles the dispute. He may be appointed by Parties or Court. There may be a sole arbitrator or panel of arbitrators. In case of panel of arbitrators, it is called Arbitrator Tribunal.  Every power given to arbitrator by this act is subject to the agreement between the parties to the dispute.  

Provision: Section 8, 12 & 20 (4) of Arbitration Act, 1940.

Meaning of Arbitrator or Umpire: It means a person or a body (persons) officially appointed to resolve dispute between parties while umpire is impartial person appointed for deciding, a case or dispute between parties.
Circumstances under which Court can appoint the Arbitrator: usually Court does not intervene in the appointment of arbitrator. Though there is certain aspect, which put stress Court to act for the observance of law. The Responsibilities of parties and Court power is ascribed as under:

Section 8 Power to appoint: This section applies to primary as well as subsequent appointment of arbitrators and applies to cases where the arbitrator or arbitrators are to be nominated by the consent of all the parties and not to those where each party is to appoint his own arbitrator. 

Initial/primary Appointment: where all the parties to agreement not agree under section 8(1): The arbitrator or arbitrators are to be appointed by all parties jointly but if they don’t agree among themselves about their (arbitrators) names after the differences have been arisen, then the court may appoint them (arbitrators). For doing so there must be;

(a) A valid agreement,

(b) There should be provision in the arbitration agreement for the appointment of one or more arbitrators,

(c)The arbitrators are to be appointed with their mutual consent,

(e)The parties fail to appoint arbitrator after the differences have been arisen,

(f) If one party fails to appoint arbitrator in original or upon vacancy, other party shall give clear notice to do so within 15 days, failure of which can cause Court intervention.

(g) Opportunity must be given to the other party to be heard.

Subsequent Appointment: Where a valid nomination has been made and arbitrator refuse to act and the parties fails to agree to fill up vacancy of the office of arbitrator, the Court may on application of either party can appoint an arbitrator or to fill up the vacancy in the following conditions for example;

(a) An arbitrator must have been appointed by the parties,

(b) the appointed arbitrator must have or neglected to act, refused to act or become incapable of acting or dies,

(c) Where it was not mentioned in the arbitration agreement that the vacancy should not be supplied and the parties or the arbitrators don’t supply the vacancy.

Power to appoint arbitrator under section 12: The Court may make subsequent appointment of arbitrators where the arbitrators are removed u/s 11 of the ibidi Act or their authority is revoked u/s 5 of the ibidi Act. The arbitrator may be appointed by the Court in the following cases.

Where Court removes one or more but not all arbitrators u/s 12(1): The Court may appoint an arbitrator on the application of any party to the arbitration agreement, to fill up the vacancy or vacancies caused by its removal on the conditions i.e.

(a) The court must have removed one or more arbitrators but not all of them,

(b) The removal must be on any of the grounds mentioned in section 11 of this Act, c) application for appointment of arbitrator must be made by party to arbitration agreement.

Where Court removes sole or all arbitrators u/s 12(2): The Court may on written application of any party to arbitration agreement, appoint a person to act as sole arbitrator in the place of the persons so evacuated on the conditions i.e.

(a) There must be removal of all arbitrators by the Court,

(b) Application for appointment must be moved by the party to an arbitration agreement,

(c) Court will appoint a sole arbitrator for the arbitration proceedings.

Where the authority of arbitrator is revoked u/s 12(2): Where the authority of arbitrator is revoked by leave of Court u/s 5 of the ibid Act, Court might on the written application of any party to the arbitration agreement appoint the sole arbitrator in the place of the persons to remove.

Power to Appoint Arbitrator u/s 20(4): The Court may make an appointment of arbitrator under this section if the following conditions are fulfilled,

(a) There must be a legitimate arbitration agreement,

(b) There is provision in the arbitration agreement for appointment of one or more arbitrators,

(c) The arbitrator or arbitrators is or are to be appointed with the common consent of all the parties,

(d) When the parties fail to agree upon the arbitrator or the arbitrator appointed so fails to act.


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