The presence of an arbitration clause necessitates arbitration for disputes arising among partners, as endorsed by the court.

ORDER

Petitioner is the managing partner of an unregistered Partnership Firm named M/s.Janasree Supermarket. A copy of the Partnership Deed dated 06.12.2021 executed between the petitioner, respondent and other partners is produced as Annexure AI.

2. The petitioner invested huge amounts in the firm’s business.

According to the petitioner, the business was generating a considerable customer base. However, some issues arose in running the business and the firm suffered loss. The petitioner submitted that the respondent borrowed an amount of Rs.4,90,000/- from the firm. However, he did not repay the amount. He also submitted that the respondent is obstructing the functioning of the firm and serious disputes have arisen between the petitioner and the respondent.

3. O.S.No.560 of 2022 was filed by the petitioner and some other partners before the Munsiff’s Court, Vadakkanchery seeking mandatory injunction against the respondent from trespassing or committing waste. The respondent entered appearance before the Munsiff’s Court and contended that in view of Clause 17 of Annexure AI Partnership Deed, the disputes between the partners are to be referred to arbitration. Accepting the respondent’s contention, O.S.No.560 of 2022 was rejected by the learned Munsiff.

4. Subsequently, the petitioner filed A.R.No.192 of 2023 before this Court seeking reference to arbitration. However, the same was later withdrawn as no requisite statutory notice had been issued prior to filing of arbitration request. Later the petitioner, through his counsel, issued a formal notice invoking arbitration, dated 25.09.2024, to the respondent. A reply was sent by the respondent through his counsel. A copy of the reply is produced as Annexure AIV. As there was no consensus regarding the appointment of the arbitrator, this arbitration request is filed.

5. Though notice was issued and service is complete, there is no appearance for the respondent.

6. Heard the learned counsel for the petitioner and perused the pleadings and documents.

7. I am satisfied that there is an arbitration clause in Annexure AI Partnership Deep. It is also clear that serious disputes have arisen between the parties. The respondent, contended before the Civil Court that in view of Arbitration Clause in Annexure AI, the suit filed by the petitioner and some other partners was not maintainable.

In the above facts and circumstances, I am of the view that this arbitration request can be allowed. Hence the following directions are issued:

1. The Kerala High Court Arbitration Centre is directed to nominate an Advocate from Panel-IV, preferably from Thrissur, as the sole Arbitrator to resolve the disputes that have arisen between the petitioner and the respondent under Annexure AI Partnership Deed.

2. The learned Arbitrator may entertain all issues between the parties in connection with the said Agreement, including questions of jurisdiction and limitation, if any, raised by the parties. All contentions of the parties are left open and they are at liberty to raise their claims and counterclaims, if any, before the learned Arbitrator, in accordance with law.

3. The Registry shall communicate the substance of this order to the Kerala High Court Arbitration Centre within ten days and the Centre shall inform the learned Arbitrator within a further period of one week and shall obtain duly signed Form 3 as required under Rule 20(4) of the Kerala High Court (Arbitration Centre) Rules, 2025 and forward the same to this Court.

4. Upon receipt of the Form 3, the Registry shall issue a certified copy of this order with a copy of the Form 3 appended to the Kerala High Court Arbitration Centre. The original of the Disclosure Statement shall be retained by the Kerala High Court