Consent of both parties is essential for appointing an arbitrator; unilateral appointment is not permissible.

JUDGMENT

(Dated this the 25^th day of November, 2025)

This petition is filed by the petitioner/decree holder by challenging the order dated 18.11.2023 passed by the Additional District Judge, N. Paravur, in EP No.32/2020 in Arbitration proceedings, ACP No.1/2020, for having dismissed the execution petition filed by the petitioner.

2. Heard the arguments of the learned counsel for the petitioner.

3. The respondents were ex-parte before the execution court. Hence, issuing notice to the respondents is hereby dispensed with.

4. The case of the petitioner is that the respondents borrowed a loan from the petitioner and defaulted in payment. Hence, the petitioner raised arbitration proceedings before the Sole Arbitrator, Sri. O.V. Rajeev, Advocate from Thrissur and an award has been passed by the Sole Arbitrator in ACP No.1/2020, wherein an award has been passed on 20.04.2020. Subsequently, for execution of the award, EP filed before the Additional District Court, N. Paravur. Notice has been issued to the respondents/judgment debtors, but they did not appear, hence placed ex parte. The execution court by hearing the case, dismissed the EP on the ground that the appointment of arbitrator is a unilateral one and there is no consent given by the respondents. Therefore, the EP is not maintainable, hence, dismissed, which is under challenge.

5. The learned counsel for the petitioner is strenuously contended that the respondents and petitioner were entered into an agreement wherein, with the consent of both parties, the sole arbitrator was named in the very loan agreement along with the designated venue of arbitration. Therefore, once again there is no need to obtain the consent of the respondents for appointing the arbitrator and that cannot be considered as unilateral. Therefore the execution court committed error in dismissing the EP proceedings. Hence, the petitioner is prayed for setting aside the same.

6. In support of the arguments, the learned counsel for the petitioner relied upon the judgment of this court in OP (C) No.1562/2025,M/s. Maben Nidhi Ltd. Vs. Ishaque & Another dated 07.07.2025 and it is contended that but this court laid upon the judgment dated 18.03.2025 of the coordinate Bench passed in O P (C) No.683/24, M/s. Hedge Finance Pvt. Ltd. Vs. Sahala V. P. and another andVadakkemuriyil Finance Company (India) Ltd. VS. K. M. Jose and another judgment dated 05.02.2025 in OP (C) No.1035/24 and contended that when the respondent and petitioner were consented for appointing the sole arbitrator and place of arbitration, the court has to proceed with the execution and cannot be dismissed on that ground hence, prayed for allowing the petition.

7. Having considered the arguments and perused the records, which reveals that, admittedly the loan agreement produced by the petitioner which was entered into between both parties, wherein the petitioner and respondents were signed the very loan agreement dated 29.03.2019, at clause 19, it is categorically mentioned all disputes and difference between in relation to the agreement shall be referred to Sri. O.V. Rajeev, Advocate from Thrissur and venue of arbitration also mentioned as Thrissur. Therefore, the contention of the trial court and execution court that the appointment of the arbitrator is unilateral, cannot be accepted. When both parties are consented for appointing the sole arbtirator and named the arbitrator in loan agreement itself, the question of seeking consent of the respondents for appointing the arbitrator does not arise. In a similar case, O P (C) No.1562/2025, M/s. Maben Nidhi Ltd. (Supra), this Court has set aside the order and remitted back for proceeding with the execution case and this court relied upon the judgment of the coordin