U.P. COOPERATIVE FEDERATION LTD. versus M/S. THREE CIRCLES

U.P. COOPERATIVE FEDERATION LTD. versus M/S. THREE CIRCLES

Findings of the arbitrator regarding balance steel and workmanship do not suffer from any infirmity; employer is estopped from raising new issues formerly unobjected; contract clauses do not include 'bad workmanship' within exclusive decision of Managing Director and do not equate 'negligence or lack of care' with 'bad workmanship'; arbitrator rightly awarded interest for pre-reference, pendente lite, interest on costs and on interest; interest rate reduced to 7% from 15% under Article 142, for ends of justice due to long lapse of time since award.

Parties
Appellant: U.P. Cooperative Federation Ltd.; Respondent: M/s. Three Circles
Jurisdiction
India
Judgment Date
10 September 2009
Procedural Posture
Civil Appeal / Appeal From High Court Judgment and Order
Outcome
Appeal dismissed, subject to modification of interest rate.
Legal Topics
Arbitration Award Setting Aside, Interest on Award, Interpretation of Contract Clauses, Workmanship, Interest on Costs
Arbitration Civil Procedure Contract Law Arbitration Award Setting Aside Interest on Award Interpretation of Contract Clauses Workmanship Interest on Costs

Case Brief

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Parties

U.P. Cooperative Federation Ltd.

Appellant

M/s. Three Circles

Respondent

Procedural Posture

Civil Appeal / Appeal From High Court Judgment and Order

Legal Issues

  1. 1 Whether the arbitrator's findings regarding balance steel recovery and bad workmanship can be set aside under the Arbitration Act, 1940
  2. 2 Whether the arbitrator had power to award interest for pre-reference period, pendente lite interest, interest on costs, and interest on interest
  3. 3 Interpretation of contract clauses related to disputes and 'bad workmanship'

Ratio Decidendi

Findings of the arbitrator regarding balance steel and workmanship do not suffer from any infirmity; employer is estopped from raising new issues formerly unobjected; contract clauses do not include 'bad workmanship' within exclusive decision of Managing Director and do not equate 'negligence or lack of care' with 'bad workmanship'; arbitrator rightly awarded interest for pre-reference, pendente lite, interest on costs and on interest; interest rate reduced to 7% from 15% under Article 142, for ends of justice due to long lapse of time since award.

Court Disposition

Appeal dismissed, subject to modification of interest rate.

Orders

  • Interest rate on award reduced from 15% to 7% from date of award in exercise of jurisdiction under Article 142 of the Constitution.
  • No order as to costs.