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Arbitration and Mediation

Sole Arbitrator passed an Ex-parte Award

I have two queries here. First background, I had credit card dues (Lost job and inability to pay back with no assets to sell) for which bank took arbitration recourse and appointed sole arbitrator in Delhi. I am in Bangalore where I got a job a week back and hence I couldn't make the visit for arbitration which was on a Friday (Plus I didn't even have cash and currently on company accommodation and waiting for first salary in feb). The arbitration notice was received at my home address in Pune. But only place of Arbitration and Sole Arbitrator name was mentioned. There was no information provided as to how to contact the arbitrator for clarification who is a retired district judge in Delhi or how to request for change of location. I couriered my questions and also evidence of my situation but it could not be delivered because the only address I had was Tiz Hazari court chambers with no contact details. The courier guy made two attempts for two continuous days but said that the court chambers are closed and there is no one there. One of the attempts was in the morning of the day when Arbitration was due. I have the screen shot of the courier firms comments stating premises is closed. 1. My query, Now that the arbitration award has been passed, Can I appeal against it to be set aside for not getting the chance to ask clarification and since Arbitrator didn't give details to contact him? 2. I already informed the bank via phone call and dropped a message on whatsapp to their representative mentioned in the legal notice that I received a job and would start making payments from Feb. This was done two weeks before the Arbritation date and the bank rep acknowledge on phone and said we can work out a settlement option after the first payment is made. Though he didn't acknowledge the receipt of my whatsapp message. If the bank rep agrees to a settlement offer, will it override the Arbitration award?

( Pune, Maharashtra )

3 years ago

Reply

Hi,

The most important factor in deciding whether or not to challenge an arbitration award is whether or not the arbitration decision is binding. If the arbitration is ineffective and non-binding, any party or parties may appeal the award without a reasonable basis for doing so. However, if the Arbitration is binding, then you must have a compelling reason to challenge the award. Section 34 (2) (a) lays down grounds for setting aside arbitration award:
1.A party is under some incapacity.
2.The arbitration agreement is not valid i.e. it is void in accordance with the law to which the parties to the agreement are subjected.
3.No proper notice of the appointment of the arbitrator or the proceedings had been given to it.
4.The award as been suspended or waved by a competent authority of the country in which it was made.
5.The main issue of the dispute cannot be resolved by arbitration under Indian law.
6.The composition of the tribunal was not in accordance with agreement of the parties.
7.The enforcement of award would be in opposition to Indian public policy

You can file an appeal with the High Court.

Yes, for a settlement offer to be binding, it should be accepted by the other party. Once accepted it has the same effect as an arbitral award.

Thank you

Vidhikarya

Helpful

Dear Client
The law provides the option to appeal against the arbitration and that is possible by appealing to the high court.
Since the award is already made you will have to tread your path carefully. If you are going to settle this then ensure that the credit card company is not taking the arbitration award for execution.