๐๐ก๐ ๐๐จ๐ฎ๐ซ๐ญ๐ฌ ๐๐ก๐จ๐ฎ๐ฅ๐ ๐๐๐จ๐ฉ๐ญ ๐๐ซo-๐๐ง๐๐จ๐ซ๐๐๐ฆ๐๐ง๐ญ ๐๐ข๐๐ฌ ๐๐ง๐ ๐๐ฎ๐ฉ๐ฉ๐จ๐ซ๐ญ ๐๐จ๐ซ ๐๐ซ๐๐ข๐ญ๐ซ๐๐ญ๐ข๐จ๐ง ๐๐ฉ๐ฉ๐ซ๐จ๐๐๐ก ๐ข๐ง ๐ ๐จ๐ซ๐๐ข๐ ๐ง ๐๐ซ๐๐ข๐ญ๐ซ๐๐ฅ ๐๐ฐ๐๐ซ๐ ๐๐๐ฌ๐๐ฌ: ๐๐
A very recent case involving foreign arbitral award issue has been decided by a three-member bench of the Supreme Court with a liberal and pro-arbitration approach. The judgment has been excellently authored by Justice Syed Mansoor Ali Shah.
๐ ๐จ๐ซ๐๐ข๐ ๐ง ๐๐ซ๐๐ข๐ญ๐ซ๐๐ฅ ๐๐ฐ๐๐ซ๐:
The main sub-judice questions before the Court were as follows: What is a foreign arbitral award under the Recognition and Enforcement of Arbitration Agreement and Foreign Award Act 2011;ย Whether the 2011 Act is applicable retrospectively; and the pro-enforcement bias of the courts towards the enforcement of an arbitral award.
The Court held to the extent of the question that section 2(e) of the 2011 Act very explicitly says that an award made in a contracting state is a foreign award, which means that the sole criterion for determination of an award as to whether it is foreign or domestic is the principal seat of the arbitration where the award has beenย made. It is not the law governing the arbitration proceeding or the contract which determines it. It is the place where the award has been made.
๐๐๐ญ๐ซ๐จ๐ฌ๐ฉ๐๐๐ญ๐ข๐ฏ๐ ๐๐ง๐ ๐๐ซ๐จ๐ฌ๐ฉ๐๐๐ญ๐ข๐ฏ๐ ๐๐๐๐๐๐ญ:
On the question of retrospective and prospective effect of a statute, the Court set a very golden principle that the sole criterion to judge whether a statute has retrospective effect is to see whether it infringes and takes away vested rights of the parties. If it does, it cannot be said to be applicable retrospectively unless the Legislature has specifically provided for it. The Court further asserted that usually it is said that a procedural enactment is automatically applicable retrospectively to the pending cases and on the contrary, a substantive enactment does not apply so. It is so but the litmus is not to see whether an enactment is procedural in nature or substantive. It is rather to see whether it takes away rights of the parties or not. If a statue, applied retrospectively, takes away rights of a party and the Legislature has not provided for its retrospective effect, it cannot be said to be applicable retrospectively even if it is a procedural enactment.
๐๐ซ๐จ-๐๐ง๐๐จ๐ซ๐๐๐ฆ๐๐ง๐ญ ๐๐ข๐๐ฌ ๐๐ง๐ ๐๐ฎ๐ฉ๐ฉ๐จ๐ซ๐ญ ๐๐จ๐ซ ๐๐ซ๐๐ข๐ญ๐ซ๐๐ญ๐ข๐จ๐ง:
The Court then jumps to a more decisive and main part of the case where the Court has emphasised on pro-enforcementย bias in arbitration proceedings which means that the legal framework is inclined in the favour of a party who supports and pleads for arbitration, not the other party who opposes an award. This does not mean that this approach should unjustly favour one party over another, but it is amid at promoting arbitration and supporting it as an alternative mode of dispute resolution.
The submissions of the counsel of the AMC were very convincing, but the Court adopted a different approach towards the concept of arbitration and interpretation of the same in our jurisdiction which led the Court to decide the case otherwise. The arguments of the counsel and the reasoning of the Court are worth a read.
c.a._722_2012
