IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE K.T.SANKARAN TUESDAY, THE 30TH NOVEMBER 2010 / 9TH AGRAHAYANA 1932 AR.No. 9 of 2010 APPLICANT ------------------ R.GEORGE PEREIRA, GEORGE MICHAEL ASSOCIATES, TC 30/1877(2), VAS VILAS, KANNAMMOOLA, PETTAH PO, THIRUVANANTHAPURAM-695024. BY SENIOR ADV. SRI.K.L.VARGHESE SMT.SANTHA VARGHESE SRI.NIHAD MOHAMED BASHEER RESPONDENT -------------------- ST.JOSEPH'S INTERNATIONAL ACADEMY, KUMBALAM PO, KOLLAM-691 503, REPRESENTED BY THE MANAGING DIRECTOR JOSEPH FERNANDEZ. THIS ARBITRATION REQUEST HAVING BEEN FINALLY HEARD ON 30/11/2010, THE COURT ON THE SAME DAY PASSED THE FOLLOWING: K.T.SANKARAN, J. ------------------------------------------------------ Arbitration Request NO. 9 OF 2010 ----------------------------------------------------- Dated this the 30th day of November, 2010 O R D E R The respondent and the applicant entered into Annexure A3 agreement for the construction of a school building. Disputes arose between the parties. According to the applicant, a balance amount of Rs.22,12,087/- was due from the respondent. 2. Clause 17 of Annexure A3 agreement reads as follows: “(17) If there is any dispute relating to any matter regarding the construction of the building or any matter related to this contract, the Manager, St.Joseph's International Academy, Kollam will be the sole arbitrator for this purpose and his decisions shall be final, and the second party will have no right to challenge this decision in the court of law.” 3. The applicant sent a letter providing a panel of three persons and requesting the respondent to select one among them as arbitrator. The respondent sent a reply without selecting any of the ARBITRATION REQUEST NO.9 OF 2010 :: 2 :: nominee arbitrators. The respondent suggested appointment of two Civil Engineers, one by each party. The parties appointed their respective nominee Engineer. Unfortunately, the Engineer nominated by the applicant passed away in a road accident. Thereafter, the applicant filed A.R.No.25 of 2007 under Section 11(6) of the Arbitration and Conciliation Act, 1996, for the appointment of an arbitrator. A.R.No.25 of 2007 was disposed of as per Annexure A1 order dated 11.10.2007, appointing Sri.E.K.Muralidharan, Retired District and Sessions Judge as the Arbitrator. 4. The respondent did not appear when A.R.No.25 of 2007 was taken up for hearing and Annexure A1 order was passed in their absence. A Review Petition was filed by the respondent, which was allowed and the order dated 11.10.2007 was recalled. As per Annexure A2 order dated 8.5.2009 in A.R.No.25 of 2007, again Sri.E.K.Muralidharan, Retired District and Sessions Judge was appointed as the Arbitrator. Various contentions were raised by the respondent. Paragraph 8 of the order dated 8.5.2009 is extracted below: “8. The provisions contained in sections 12 and 13 of the Arbitration and Conciliation Act incorporate ARBITRATION REQUEST NO.9 OF 2010 :: 3 :: grounds for challenge and the challenge procedure against and in respect of arbitrators will reveal that partiality and bias or circumstances giving rise to justifiable doubts regarding the impartiality and independence can be valid grounds for challenging the appointment given to a certain persons as arbitrator. At the same time, a party should not be allowed to wriggle easily out of agreements entered into by them with open eyes. In the instant case it is seen that the applicant had agreed to the appointment of a person in the service of the opposite party as an arbitrator in the event of disputes. That being the position I would have been ordinarily reluctant to accept the opposition of the applicant to the appointment of the nominated arbitrator on ground of bias and partiality. After all, it is a quasi judicial function which is being discharged by the arbitrator whose proceedings will be regulated by the provisions of the Arbitration and Conciliation Act. His award will be subjected to judicial scrutiny though on limited grounds and to a limited extent. But in the instant case I am not inclined to dismiss the arbitration request and to appoint the nominated arbitrator as the arbitrator for resolving the disputes which have admittedly arisen between the parties because it is seen from Annexures A4 and A5 that the respondent also became agreeable to the idea of the disputes between the parties being resolved by persons other than the ARBITRATION REQUEST NO.9 OF 2010 :: 4 :: arbitrator nominated under the agreement. Annexures A6 and A7 will show that the parties had nominated an Engineer each and were willing to have the disputes between them resolved by a joint perusal of the relevant records by these two Engineers. To this extent, in my opinion the respondent has waived his right to insist that the arbitrator to be appointed has to be the arbitrator nominated under the agreement. Moreover, in my opinion no prejudice whatsoever will be occasioned to the respondent by appointing a Retired Judicial Officer known for his learning and integrity as the arbitrator for resolving the disputes which admittedly subsist. Therefore without deciding the issue whether appointment of the nominated arbitrator will be vitiated due to reasons of bias and partiality I allow the arbitration request and appoint Sri.E.K.Muraleedharan, Retired District and Sessions Judge, presently at Ernakulam as arbitrator for settling all the claims and counter claims raised by the applicant and the respondent as detailed in Annexures A1 to A4 as well as in the arbitration request. The arbitrator will enter on arbitration and make and publish his award without undue delay.” 5. It is submitted that Sri.E.K.Muralidharan, Retired District and Sessions Judge passed away. The applicant has approached ARBITRATION REQUEST NO.9 OF 2010 :: 5 :: this Court again under Section 11(6) of the Arbitration and Conciliation Act for appointment of an arbitrator. Though notice was served by special messenger on the respondent, there is no appearance for the respondent. 6. Learned counsel for the applicant suggested that Smt.Sreelatha Devi, Retired District and Sessions Judge, may be appointed as the Arbitrator. Taking into account the facts and circumstances of the case, the Arbitration Request is allowed. Smt.Sreelatha Devi, Retired District and Sessions Judge is appointed as the Arbitrator for resolving the disputes between the applicant and the respondent touching upon Annexure A3 agreement. The Arbitrator is free to fix her fee. (K.T.SANKARAN) Judge ahz/