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Section 11 and Section 14 Arbitration Act, 1996

The judgement was passed by Delhi Court on the issue of Appointment of Arbitrators to form an arbitral tribunal.

S.11 of the Act pertains to the procedure to appoint arbitrator. First one is by an application to the concerned High Court for appointing a sole arbitrator whereas the second procedure requires that two arbitrators appointed by the parties to the Arbitration Agreement shall appoint a third presiding arbitrator.

S.14 of the Act deals with the resignation/termination of the appointed arbitrator. The grounds for resignation are inability to perform the duty de jure or de facto or where he himself withdraws from the case citing any other reason. The grounds for termination can relate to the independency or impartiality of the arbitrator where the parties can terminate the mandate of the tribunal.

It is pertinent to mention here the Judgement of Perkins Eastman[1]. In this Judgement the Supreme Court has held that a party does not have a sole right in appointing an arbitrator. The parties individually or together must first approach the high court for appointment of the arbitrator. Therefore, where an arbitration clause gives right to only one party to appoint an arbitrator the party cannot appoint the arbitrator itself and initiate the proceedings.

The Delhi High Court in the Judgement Raksha Vigyan Karamchari Sahkari Awas Samiti v. Proto Developers and technologies Pvt. Ltd[2]¯ held that where a party appoints a sole arbitrator without approaching the court then the appointment shall be invalidated and the second party has the right to approach the court under section 14.

The Respondent in this case has solely appointed an arbitrator without court™s intervention. The Petitioners then approached the Delhi High Court for appointment of the Arbitrator to which the Respondents objected. However, the Court in this case dismissed the Section 11 petition with the liberty to the Petitioner's to approach the court under section 14 of the act. Thereby rejecting the appointment of the arbitrator by the Respondents and then replacing the appointment with another arbitrator.

This is perfect example of conversion of section 11 application into section 14 application.

End-Notes:
  1. Perkins Eastman Architechts DPC and Anr. v. HSCC (India) Ltd. Arbitration Application No. 32 of 2019
  2. OMP (T) (Comm.) 60/ 2020

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