2008 (8) TMI 974 - HC - Indian Laws

Summary

Issues Involved:
1. Termination of the arbitrator's mandate due to efflux of time.
2. Waiver of the condition stipulating the time within which the award was to be made.
3. Determination of when the arbitrator entered upon the reference.
4. Validity of the arbitrator's appointment and jurisdiction.
5. The impact of parties' conduct on the waiver of time stipulation.

Issue-wise Detailed Analysis:

1. Termination of the Arbitrator's Mandate Due to Efflux of Time:
The petitioner sought a declaration that the arbitrator's mandate had terminated due to the expiration of the time stipulated in the arbitration agreement dated 13.12.1996. Clause 91(b) of the agreement required the award to be made within two years of the arbitrator entering upon the reference, with a possible extension of twelve months. It was admitted that the stipulated time had expired.

2. Waiver of the Condition Stipulating the Time Within Which the Award Was to Be Made:
Despite the expiration of the stipulated time, the court found that the petitioner had waived the condition. The waiver was evidenced by the petitioner's participation in arbitration proceedings beyond the stipulated period without raising any objections. The court noted that the petitioner attended meetings, agreed to schedules, and did not object to extensions requested by the respondent, indicating a clear waiver.

3. Determination of When the Arbitrator Entered Upon the Reference:
The court considered various dates proposed by both parties for when the arbitrator entered upon the reference: 19.4.2002, 28.5.2002, 28.6.2002, and 16.10.2002. The court concluded that the arbitrator entered upon the reference on 28.5.2002, when the arbitrator applied his mind to the petitioner's application challenging his jurisdiction. The court distinguished between ministerial acts and adjudicative acts, determining that the arbitrator's consideration of jurisdictional questions constituted entering upon the reference.

4. Validity of the Arbitrator's Appointment and Jurisdiction:
The petitioner contended that the arbitrator's appointment was invalid as it was not made within thirty days of the request, as required by the arbitration agreement. This issue was raised in an application under Section 16 of the Arbitration and Conciliation Act, 1996, and was decided against the petitioner by the arbitrator on 28.6.2002. The court upheld the arbitrator's jurisdiction, noting that the petitioner had waived any objections by participating in the proceedings.

5. The Impact of Parties' Conduct on the Waiver of Time Stipulation:
The court emphasized that the petitioner's conduct, including attending meetings and agreeing to schedules beyond the stipulated period, constituted a waiver of the time condition. The court cited several instances where the petitioner did not object to extensions or the continuation of proceedings, reinforcing the finding of waiver. The court also referred to the principle of waiver under Section 4 of the Arbitration and Conciliation Act, 1996, which is based on general principles such as estoppel.

Conclusion:
The petition was dismissed, with the court finding that the petitioner had waived the stipulation regarding the time within which the award was to be made. The court allowed the arbitration proceedings to continue, providing an eight-week period for the petitioner to challenge the order. The judgment highlighted the importance of parties' conduct in determining waiver and the distinction between ministerial and adjudicative acts in arbitration proceedings.