NOTES

DEFINITIONS UNDER ARBITRATION ACT

Sec 2 (1), in this part unless the context otherwise requires:

 

  1. ‘arbitration’- means any arbitration whether or not administered by a permanent arbitral institution.

Explanation-  the definition is not comprehensive, it does not assign ant particular meaning to the term arbitration, therefore, its commonly understood meaning shall apply. The terms as defined in this clause connote that although arbitration is supposed to be entrusted to individuals appointed by the parties themselves this Act would recognize arbitration entrusted to permanent arbitral institutions also.

 However, individuals of the party’s choice can still be appointed as arbitrators because it is not obligatory to entrust it to an institution.

 

  1. ‘arbitration agreement’- means an agreement referred to in section 7.

Explanation- according to sec 7, arbitration agreement means an agreement by the parties to submit to arbitration all or certain disputes which have arisen or which may arise between them in respect of a defined legal relationship, whether contractual or not.

An arbitration agreement may be in the form of an arbitration clause in a contract or in the form of a separate agreement or may arise where parties by reference import the arbitration clause contained in an earlier document into a subsequent contact so as to incorporate it.

 

  1. ‘arbitral award’-  includes an interim award.

Explanation-  sec 2(1)(c) merely clarifies that an arbitral award would include an interim award. It does not define the term. It must be read with sec 31. of the Act which deals with the form and contents of an arbitral award.

 

  1. ‘arbitral tribunal’-  means a sole arbitrator or a panel of arbitrators.

Explanation-  the expression arbitral tribunal means a sole arbitrator or a panel of arbitrators. In view of the provisions of sec 10 reference can be made to a sole arbitrator or an uneven number of arbitrators termed as an arbitral tribunal.

  1. ‘court’- means the principal Civil Court of original jurisdiction in a district and includes the High Court in exercise of its original jurisdiction, having jurisdiction to decide the questions forming the subject matter of the arbitration if the same had been the subject matter of a suit, but does not include ant Civil Court of a grade inferior to such principal Civil Court, or any Court of Small Causes.

 

  1. ‘international commercial agreement’-  means an arbitration relating to disputes arising out of legal relationships, whether contractual or mot, considered as commercial under the law in force in India and where at least one of the parties is-

  • an individual who is national of, or habitually resident in, any country other than India or

  • a body corporate which is incorporated in any country other than India or

  • the Government of a foreign country.

 

  1. ‘legal representative’- means a person who in law represents the estate of a deceased person and includes any person who intermeddles with the estate of the deceased and where a party acts in a representative character, the person on whom the estate devolves on the death of the party so acting.

Explanation-  the definition of the term ‘legal representative’ can be divided into three parts. According to the definition the following persons are to be regarded as legal representatives;

  • a person who in law represents the estate of the deceased, for example, an executor of a will or administrator of the estate of the deceased or an heir under the personal law; or in the Court of Wards who administers the estate of the ward;

  • a person who intermeddles with the estate of the deceased, that is, a person who retains possession of the properties belonging to the estate of the deceased with the intention of representing it.

  • in the case of claims of a representative character a person on whom the estate devolves on the death of a party to the arbitration.

         The following persons have been held not to be legal representatives:

  •  an assignee from a deceased zamindar to whom the holding reverts on the death of the tenant.

  • A person who claims adversely to the estate of the deceased.

  • A new trustee appointed or elected on the death of the deceased trustee.

 

  1. ‘party’- means a party to an arbitration agreement.

Explanation-  the meaning of the expression ‘party’ is not restricted to a party who signed the agreement to the extent as provided in secs. 40, 41 and 35 since the context requires otherwise. Therefore, to the extent, as provided in secs. 40 and 41 the term party will include the legal representatives of the party upon the death of the party or a receiver or official assignee in the case of insolvency of the party, further, in sec 35 persons claiming under the parties are equated with parties for the purposes of the binding character of an arbitral award.

 

  1. Sec 2(7) defines ‘domestic award’- as an arbitral award made under Part-I shall be considered as a domestic awards

Explanation- in order to constitute a domestic award it is essential that-

  • The arbitral award should be made in arbitration proceedings conducted in India. It is immaterial whether the arbitration is an international commercial arbitration or non-international commercial arbitration.

  • Such proceeding must be in accordance with Part –I of the Act.