The ails of Arbitration proceedings

Anand Byra Reddy, former Judge, Karnataka High Court.

As a retired Judge of the High Court of Karnataka, since almost a decade — arbitration is one avenue that I have been treading with adequate financial rewards and much satisfaction of being able to adjudicate matters of some complexity.

But it is obvious that Bengaluru, is at a stage of finding its bearings in the mode and pace —which is possible and very much needed— in the conduct of arbitration proceedings.

Learned counsel, as practitioners before courts of law, and given the mode of functioning of courts, the mindset of the average lawyer consciously, or unconsciously, develops timeframes, which become ingrained in computing timeframes for any activity as counsel. Take for instance, the drafting of a Plaint or a Petition, or an Interlocutory Application —or the statement of Objections to one. Depending on the nature of the case, the stakes involved and the fees that has been received, the chore will be attended to appropriately in order of priority, that a practitioner may place on the matters on hand.

Assuming that a litigant has made his or it's, enquiries as to the lawyers who are equipped to deal with particular matters, will invariably be drawn to a practitioner with some experience and a fairly busy practise, to entrust their arbitration case, particularly with the limited number of practitioners available, who are now concentrating or dealing exclusively, in arbitration cases.

The mindset of 'Time-frames'

The above maybe the first impediment to speedy arbitration proceedings.

As most arbitration cases are conducted only with the aid of legal counsel and knowing the situation in the courts, which are to deal with overloaded dockets, where several dozens of cases are on the boards of most courts, on each day, it is but inevitable and impractical for a court to devote close and detailed attention to all matters. The route available for the court is to safely adjourn cases without causing damage to a party except delaying the matter, to be considered on another day. And give particular attention to matters which have progressed in their journey. And it has come to a pass where the average legal practitioner is invariably swept up to accept the routine of seemingly, casual postponement of cases.

In my experience, as an arbitrator, practitioners expect the arbitration case also to be dealt with as matters are dealt with in courts.

Firstly, in arbitration — unlike in court proceedings, it is possible for the arbitrator to fix a schedule for the process of the Claimant filing a Statement of Claim and documents in support thereof, the Respondent to file his Reply or Statement of Defence and a

Counterclaim, if any, and for the Claimant to file a Reply to the Counterclaim. However, the above process is not completed within the timeframe prescribed. The Arbitration and Conciliation Act, 1996, does require the pleadings of the parties to be completed within 6 months- from the date the arbitral tribunal is informed, in writing, of its appointment - but has provided the discretion to the arbitral tribunal to prescribe the time for the several steps in the process. It is difficult to push counsel, who are juggling with court work and arbitration cases, to adhere to timelines. Particularly, when they are in courts most of the time —which are by necessity, required to be liberal in granting extension of time to meet deadlines, it probably evokes remorse and disgust in the practitioner, to be denied that facility by a private forum -the arbitral tribunal.

The completion of pleadings

Secondly, the time of six months to complete the pleadings in arbitration cases — is cited, to seek postponement of the time fixed, for completion of pleadings. This should not be, it is expected that the counsel on both sides, are thoroughly briefed by their respective parties as to the facts of their case and may not require weeks to translate the same into pleadings, to their clients' best advantage. In that, it may be possible that the Claimant can be ready with its, or his Statement of Claim - before, or as soon as, the arbitral tribunal enters on the reference, particularly, if the appointment has been made by the High Court under Section 11 of the Act, which process itself would have consumed considerable time. And the Respondent may also not require the amount of time usually being requested, to meet the case put forth, which would certainly not take the Respondent by surprise — to be enabled to seek a long time to prepare a Reply.

'Automatonic' Evidence

Thirdly, at the stage of evidence, it is commonly noticed that particularly, the Claimant leads evidence, which is usually by way of affidavit- evidence, with the deponent being made available for cross-examination — physically, at an arbitration meeting. The Affidavit in evidence, generally- is a mere reproduction of the Claim averments verbatim, - but only made in the first person through the witness/deponent. This is an empty exercise.

Generally, in commercial disputes, the events and circumstances are borne out by documents that speak for the course of events, it is unnecessary for a witness to superimpose his, or her, opinion on the same- when the documents speak more clearly. It may be for the satisfaction of the practitioner or the party, that the step in the process, of leading evidence, is played out. It is in most cases a superfluous and unnecessary exercise and sometimes counterproductive. When there is already a process of the parties having exchanged affidavits of their Admission and Denial of each other's documents, it is only the documents which are denied, which may require further proof by a witness speaking for it.

Conclusion

The above, are some of the steps which require to be viewed with a different lens, different from the one used to view a court's functioning. The apprehension that any, seeming, haste would not enable the parties to raise other aspects which are of importance to be dealt with by the arbitral tribunal, apart from the main case — but very crucial to its outcome- may not also be entirely accurate. All and every legal aspect, save procedural lapses which may be mandatory and fatal to court cases- governed by the Code of Civil Procedure, 1908, can be urged before the arbitral tribunal —without an intention to procrastinate matters, and could be dealt with speedily, by the arbitral tribunal, on the very day, or soon after such points of law are raised, when the same are by way of Interlocutory applications requiring Objections to be place on record.

It is also possible, as has happened in many an arbitration case, that when parties genuinely believe the strength of their respective case, with no intention to thwart a final adjudication, invariably become conscious of the lacuna in their case, as it progresses and matters are amicably settled in a compromise.

It is only the litigant who stands to gain by deliberate delaying tactics, who would thrive on the delays in courts and would attempt to employ possible delaying tactics in arbitration as well.