SIME DARBY ENGINEERING SDN. BHD. versus ENGINEERS INDIA LTD.

SIME DARBY ENGINEERING SDN. BHD. versus ENGINEERS INDIA LTD.

Since the arbitration agreement is silent as to the number of arbitrators, Section 10(2) of the Arbitration and Conciliation Act, 1996 applies, which stipulates appointment of a sole arbitrator. Policy decisions made after the contract cannot override the contract clauses. Therefore, a sole arbitrator is to be appointed.

Parties
Petitioner: SIME DARBY ENGINEERING SON. BHD.; Respondent: ENGINEERS INDIA LTD.
Jurisdiction
India
Judgment Date
22 July 2009
Procedural Posture
Arbitration Petition / Order on Appointment of Arbitrator
Outcome
Petition allowed.
Legal Topics
Appointment of Arbitral Tribunal, Number of Arbitrators, Contractual Interpretation, Policy Decision Vs Contractual Clause, UNCITRAL Model Law
Arbitration International Commercial Arbitration Administrative Law Appointment of Arbitral Tribunal Number of Arbitrators Contractual Interpretation Policy Decision Vs Contractual Clause UNCITRAL Model Law

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Parties

SIME DARBY ENGINEERING SON. BHD.

Petitioner

ENGINEERS INDIA LTD.

Respondent

Procedural Posture

Arbitration Petition / Order on Appointment of Arbitrator

Legal Issues

  1. 1 Whether the arbitral tribunal should consist of three arbitrators or a sole arbitrator under the agreement and applicable statutes.
  2. 2 Whether a policy decision regarding constitution of the arbitral tribunal can override the contract between the parties.

Ratio Decidendi

Since the arbitration agreement is silent as to the number of arbitrators, Section 10(2) of the Arbitration and Conciliation Act, 1996 applies, which stipulates appointment of a sole arbitrator. Policy decisions made after the contract cannot override the contract clauses. Therefore, a sole arbitrator is to be appointed.

Court Disposition

Petition allowed.

Orders

  • Justice D.P. Wadhwa, former Judge of the Supreme Court, is appointed as the sole arbitrator.
  • The arbitrator is requested to decide the dispute as early as possible and preferably within six months from the date of entering upon the reference.