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Nimrod India (Partner)     23 November 2012

Challenge to arbitration

Greetings!   I and my cousin had 2 partnerships (firms)  and decided to separate form 31st March 2012.  However there were issues about division and separation of assets. Both of us referred to our family CA for arbitration in August 2012. The arbitration mandate was given by both families separately but on the same draft which also mentioned that the reference was irrevocable and will not be challenged in any court.

My cousin requested the CA not to call both of us together for arbitration as he feared a fight. He appeared a few times with sketchy details and last 2 months he did  not attend even after  the arbitrator's phone calls. Now he has served a notice on the arbitrator that he is in collusion with me and he (cousin) wants to back out from arbitration.

He has cited following reasons for challenge -

a) Proper arbitration procedure is not followed as both parties not called together

b) Enough time has passed and he's not proceeded ahead

c) The arbitrator is in collusion with me and is partial


I need to know what is the procedure for me now. Can my cousin walk out of arbitration my making loose claims? Can the arbitrator proceed regardless of this challenge or we need another arbitrator?


Please HELP


 4 Replies

H. S. Thukral (Lawyer)     23 November 2012

It is up to the Arbitrator to take a decision in view of allegaions of bias against him. However if he proceeds further and passes an Award, the Award can be challenged on these grounds if proved. You don't have any authority to remove him.  It is better if the Arbitraqtor disposes the application moved by the party giving fair reasons for rejecting the allegations in the order sheet. the other party can also move the court for removal of the arbitrator on the said grounds. 

As far as your position is concerned, participate n the roceedings if the Arbitrator continues.   

Nimrod India (Partner)     23 November 2012

Thanks! Can the other party (my cousin) challenge the arbitrator for bias before any judgement is passed?   Does he have to move court if wants to move out of arbitration ?

H. S. Thukral (Lawyer)     24 November 2012

He can move the court for removal of the arbitrator.

Rajinder Singh Bhalla (Proprietor)     22 January 2013

He can move the court. An arbitrator is not supposed to follow any set rules. Hearing both parties separately is not much of a problem. Specially if he has addressed the issues raised by both parties clearly.

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