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1981 Supreme(Cal) 271
High Court Of Calcutta
R. N. Pyne
SMT.SHILA BANERJEE - Appellant
Versus
STATE OF WEST BENGAL - Respondent
Matter 1656 Of 1980
Decided On : 07/22/1981
The power of the Chief Engineer to appoint an arbitrator having been once exercised cannot be exercised again.
Headnote:
{'KEYWORD': 'Arbitration - Appointment of Arbitrator - Vacancy - Revival of Power - Section 8 (1) (b) of the Arbitration Act, 1940', 'SUBJECT': 'Appointment of Arbitrator - Vacancy - Revival of Power', 'ACT SECTION LIST': ['Section 8 (1) (b) of the Arbitration Act, 1940']}
Fact of the Case:
The petitioner and the respondent entered into two contracts for construction of a road bridge and a diversion channel. Disputes arose between the parties, and the petitioner invoked the arbitration clause in the contracts. The Chief Engineer of the respondent appointed an arbitrator, who declined to act. The petitioner then appointed a sole arbitrator, but the respondent did not concur in the appointment. The petitioner filed an application under Section 8 (1) (b) of the Arbitration Act, 1940, seeking the appointment of an arbitrator.
Finding of the Court:
The court held that the power of the Chief Engineer to appoint an arbitrator having been once exercised cannot be exercised again. The arbitration agreement does not provide for a situation when the arbitrator appointed by the persona designate under the agreement has declined and/or refused and/or expressed his unwillingness to act as an arbitrator. The arbitration clause in my view does not show any such intention of 'he parties. There is no evidence to show that the parties intended that, in such a case, the power of the appointing authority to appoint a new arbitrator would revive. That being the position it is only the Court who can appoint an arbitrator in the instant case if otherwise all the conditions as laid down in Section 8 (1) (b) of the Arbitration Act are satisfied.
Issues: Whether the power of the Chief Engineer to appoint an arbitrator revives when the arbitrator appointed by him declines to act.
Ratio Decidendi: The court held that the power of the Chief Engineer to appoint an arbitrator having been once exercised cannot be exercised again. The arbitration agreement does not provide for a situation when the arbitrator appointed by the persona designate under the agreement has declined and/or refused and/or expressed his unwillingness to act as an arbitrator. The arbitration clause in my view does not show any such intention of 'he parties. There is no evidence to show that the parties intended that, in such a case, the power of the appointing authority to appoint a new arbitrator would revive. That being the position it is only the Court who can appoint an arbitrator in the instant case if otherwise all the conditions as laid down in Section 8 (1) (b) of the Arbitration Act are satisfied.
Final Decision: The court appointed Mr. A. M. Pal, Barrister-at-Law as the sole arbitrator and all disputes and difference between the parties under the two contracts mentioned in the petition are referred to him.
( 1 ) BY a writing and/or work order dated 9-4-1976/15-4-1976 being Tender No. 34/s/m of 1976-77, the petitioner and the respondent entered into a contract for construction of a road bridge over the 'madaria Khal' at chain 1237. 00 at an estimated cost and/or value of Rs. 2,69,115/ -. By another writing and/or work order dated August 9, 1976 being reference No. 1182 and Tender No. 9 (M) of 76-77 the parties entered 79 E/m into another contract for the work of putting, maintaining, removing the cross bundh, construction of diversion channel and refilling the same after construction and construction of the approach road at the site of minor road bridge at chain 1237. 00 On 'madaria Khal' an estimated cost and/or value of Rs. 23,300/ -. It is stated that the said two contracts consist of the following documents :-- (i) West Bengal Form No. 2911 (ii)---- In the case of First Contract -- and 2911 (i), in the case of Second Contract, (ii) Schedule of rates attached to the respective contracts; (iii) Specification attached to the respective contracts; (iv) Additional terms and conditions] and (v) Drawings. The said contracts, inter alia, contain an arbitration clause as follows :--"except as otherwise provided in the contract all questions and disputes, relating to the meaning of the specification, design, drawing and instruction hereinbefore mentioned and as to the quality of workmanship or materials used on the work or as to any other question, claim, right, matter or thing whatsoever in any way arisen out of or relating to the contract, design, drawing, specification, estimates, instruction, orders or those conditions or otherwise consigning the works of the execution, or failure to execute the same, whether arising during the progress of the work or after the completion or abandonment thereof shall be referred to the sole arbitration of the Chief Engineer of the Department. Should the Chief Engineer be for any reason unwilling unable to act as such arbitrator, such question and dispute shall be referred to an arbitrator to be appointed by the Chief Engineer. The Award of the arbitrator shall be final, conclusive and binding on all parties to this contract. "'
( 2 ) ACCORDING to the petitioner some payments were made in respect of the works done under the said two contracts. But she bas still a claim for a sum of Rs. 5,39,845/- on account of the first contract and a sum of Rupees l,37,500/- on account of the second contract then her total claim is Rupees 6,77,345/ -.
( 3 ) THE petitioner's case is that in spite of demands the respondent No. 1 failed and neglected to pay the said sum of Rs. 6,77,345/- or any portion thereof to the petitioner. Therefore according to the petitioner disputes and differences and/or questions of claims and/or right had arisen out of or relating to or within the ambit of the said arbitration clause by and between the parties herein.
( 4 ) AS the petitioner's aforesaid claim was not paid by a letter No. B/j/491/78 dated December 12, 1978 the petitioner duly applied in terms of the aforesaid arbitration clause to the Chief Engineer of the respondent No. 1 for appointment of an arbitrator to decide and settle the disputes that had arisen between the parties in terms of the said arbitration clause. In spite of such requests the respondent No. 2 failed and/ or neglected to act as an arbitrator or to appoint a sole arbitrator in terms of the said arbitration clause Ultimately bv a letter and/or an order dated Dec. 21. 1979 Mr. S. P. Sen. Chief Engineer-1, West Bengal Irrigation and Waterways Directorate of the respondent No. 2 (hereinafter referred to as "the Chief Engineer") appointed, by virtue of the said arbitration clause one Mr. P. K. De, retired Chief Engineer of the Irrigation and Waterways Directorate. Government of West Bengal as the sole arbitrator to, settle the aforesaid disputes. By a letter dated January 15, 1980 the appointed arbitrator Shri P. K. De agreed to act as a sole arbi
