1. Objection to reference to independent arbitrator based on arbitration clause and concern about precedent. (Para 4 )
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2005 Supreme(SC) 756
SUPREME COURT OF INDIA
R.C. Lahoti, C.J.I., Dr. AR. Lakshmanan and G.P. Mathur, JJ.
Union of India (UOI) - Appellants
Vs.
Concrete Products and Construction Company - Respondent
Special Leave to Appeal (Civil) Nos.18244-18245/2004 and Civil Appeal No. ... of 2005 (Arising out of SLP (C) Nos. 18244-18245 of 2004)
Decided On: 02.05.2005
Advocates:
Advocate Appeared
For Appellant/Petitioner/Plaintiff: B. Dutta, ASG, Anuvrat Sharma and Shreekant N. Terdal, Advs.
For Respondents/Defendant: Harish N. Salve, Mukul Rohtagi, Sr. Advs., G. Umapathy, Sam Mathew and Rakesh K. Sharma, Advs.
Advocate Appeared
For Appellant/Petitioner/Plaintiff: B. Dutta, ASG, Anuvrat Sharma and Shreekant N. Terdal, Advs.
For Respondents/Defendant: Harish N. Salve, Mukul Rohtagi, Sr. Advs., G. Umapathy, Sam Mathew and Rakesh K. Sharma, Advs.
Important Points
The court held that the appointment of an independent arbitrator based on the peculiar facts and circumstances of a specific case does not establish a binding legal precedent for future cases.
Subject
Civil Law - Arbitration
Headnote
(A) Arbitration - Appointment of Independent Arbitrator - Referral of dispute for adjudication by an independent arbitrator, preferably a retired Judge - Decision based on peculiar facts and circumstances of the specific case - Such a referral does not constitute a precedent for other cases. (Para 4)
Facts of the case:
A dispute arose between a state entity and a construction company. The state entity expressed reservations regarding the referral of the matter to an independent arbitrator, citing concerns that such an action might establish a binding precedent for future disputes.
Findings of Court:
The court directed that the disputes be referred for adjudication by an Arbitral Tribunal consisting of a former Judge of the apex court as the sole arbitrator. The arbitrator is authorized to fix reasonable fees and expenses, and the parties are granted liberty to seek interim relief from the sole arbitrator.
Issues: Whether the dispute should be referred to an independent arbitrator and whether such a referral would establish a binding precedent for other cases.
Ratio Decidendi: The court ruled that the decision to refer a matter to an independent arbitrator was formed based on the peculiar facts and circumstances of the specific cases and, therefore, cannot be treated as a precedent to be followed in other matters.
Result: The impugned Judgments of the lower court are set aside. The appeals stand disposed of in the above said terms.
Facts of the case:
A dispute arose between a state entity and a construction company. The state entity expressed reservations regarding the referral of the matter to an independent arbitrator, citing concerns that such an action might establish a binding precedent for future disputes.
Findings of Court:
The court directed that the disputes be referred for adjudication by an Arbitral Tribunal consisting of a former Judge of the apex court as the sole arbitrator. The arbitrator is authorized to fix reasonable fees and expenses, and the parties are granted liberty to seek interim relief from the sole arbitrator.
Issues: Whether the dispute should be referred to an independent arbitrator and whether such a referral would establish a binding precedent for other cases.
Ratio Decidendi: The court ruled that the decision to refer a matter to an independent arbitrator was formed based on the peculiar facts and circumstances of the specific cases and, therefore, cannot be treated as a precedent to be followed in other matters.
Result: The impugned Judgments of the lower court are set aside. The appeals stand disposed of in the above said terms.
Legal Category Hierarchy
Table of Contents
2. Opinion to refer to independent arbitrator was based on peculiar facts and cannot be a precedent. (Para 4 )
3. Directions based on peculiar facts and circumstances do not constitute binding precedent. (Para 4 )
4. Leave granted, appeals disposed of, High Court judgments set aside, disputes referred to arbitration by sole arbitrator. (Para 1 , 2 , 3 , 5 , 8 )
5. Can a court order referring disputes to arbitration based on peculiar facts serve as a binding precedent?
No, such an order based on peculiar facts and circumstances cannot be a precedent to be followed in other cases. (Para 4 )
ORDER
1. Leave granted.
2. The appeals stand disposed of in the above said terms.
3. Leave granted.
4. Pursuant to the order dated 11th April, 2005, the learned Additional Solicitor General appearing for the Appellants submits that the Railways have some reservation about the matter being referred to an independent arbitrator in view of the arbitration clause; and, further because this may become a precedent. We make it clear that our opinion as expressed in the order dated 11th April, 2005 to refer the matter for adjudication by an independent arbitrator, preferably a retired Judge, was formed on the peculiar facts and circumstances of these cases and, therefore, cannot be a precedent to be followed in other cases.
5. We direct that the disputes between the parties arising for decision in these matters be referred for adjudication by an Arbitral Tribunal consisting solely of Mr. Justice K. Venkataswami, a former Judge of this Court.
6. The learned Arbitrator would appoint his reasonable fee and expenses.
7. The parties would be at liberty to seek interim relief from the sole Arbitrator.
8. The impugned Judgments of the High Court are set aside. The appeals stand disposed of in the above said terms.
Disposed off.
