“An arbitrator has the jurisdiction to correct and interpret his award and if necessary he may even amend his core award under the arbitration and conciliation act, 1996.”
Introduction
Day by day we are going into the complex nature of commercial intercourse in case of different sort of business transactions like transfer of tangible or intangible assets, services across boundaries etc. We are facing so many arbitrational disputes everyday in nationally and internationally. To solve these arbitrational disputes the term international arbitration has come out actually. The arbitration and conciliation act provides a fair, efficient and capable procedure. The act based on the UNCITRAL Model Law for International Commercial Arbitration that provides a significant settlement for arbitrators. Some of us are very much worried about the validity and finality of arbitral awards and looking for a solid guidance from statutory law in order to reduce the disputes. There is an insufficient dissimilarity between judicial review of an arbitral award based on contract interpretation and judicial review of an arbitral award based on statutory interpretation[1]. For example, the Federal Arbitration Act also provides a tool for arbitral parties to petition the “United States court” to give up an arbitration award where the award was procured by corruption, fraud, or unwarranted means, besides there was an evident prejudice or corruption in the arbitrators, Where the arbitrators increase their power so that they can execute their awards repeatedly. Federal court has already identified different kinds of non-statutory fields like where the arbitrator has noticeably overlooked the law or when the arbitration award is totally illogical.
Arbitration
“The process by which the parties to a dispute submit their differences to the judgment of an impartial person or group appointed by mutual consent or statutory provision”. Arbitration is a voluntary work of a submission for solving a dispute to reach an ultimate decision. Arbitration is one kind of tool or alternative dispute resolution (ADR) to arbitrate an business disagreement outside the court. It is obvious that to solve a dispute by an arbitrator instead of court is comparatively less expensive. Arbitration could be voluntary or mandatory and binding or non-nonbinding. The UNCITRAL Arbitration Rules, 1976and the Arbitration Rules of the Permanent Court of Arbitration (PCA) provide, where a sole arbitrator to be appointed, for parties to prefer either the arbitrator or the AA by agreement or where three arbitrators are to be selected for each party to propose an arbitrator who choose the presiding arbitrator or an AA. The ICC may authorize parties to carry on the look for appropriate arbitrators
Characteristics of Arbitration
a) Agreement: Agreement between parties is a sine qua non for option to arbitration[2] and can either be arbitration section in the main agreement or compliance to arbitration agreement. According to public law, agreements are practical preparations focus to public law depends on the strength of the major contract. The main exceptions to this are “arbitration without privities” and constitutional or obligatory Arbitration.
b) Freedom of choice of arbitrator, law and jurisdiction
Those parties are involved with arbitration they can select any arbitrator and arbitral tribunal that is institutional or ad hoc so that the disagreement could be determined by autonomous or neutral judges of their selection. This selection sometimes needs to be delegated[3]. A tribunal can thus operated by an expert to resolve a dispute and as soon as possible they pass a sensible award.
C) Privacy, Confidentiality and Enforceable awards
Including arbitrators, parties, counsel and clerical an arbitration is a hidden and very sensible
process because of private adjudication and the exclusion of standards. The award of tribunal
binds both parties is enforceable nationally and internationally and has long lasting legapenalty.
Plethora conventions such as the New York Convention assurance their gratitude and
enforcement provided that a well developed structure that makes awards easier to enforce than
overseas judgments.
ARBITRATION AND CONCILIATION ACT, 1996
Arbitration
The law connecting to Arbitration is enclosed in the Arbitration and Conciliation Act, 1996. It came into power on the 25th day of January 1996. This Act is of consolidating and amending nature and is not comprehensive. But it goes much away from the capacity of its ancestor, the 1940 Act. It provides for household Arbitration and also enforcement of foreign arbitral awards. It also involves the new characteristic on conciliation. It earnings on the foundation of the UN Model Law so as to make our law agreement with the Law adopted by the United Nations Commission on International Trade Law. The main objectives of the Act are- to widely cover international commercial arbitration and conciliation as also domestic arbitration and conciliation, to make stipulation for an arbitral process which is fair, efficient and competent of
meeting the needs of the definite arbitration, to provide that the Arbitral tribunal gives reasons for its arbitral award, to make sure that the Arbitral tribunal leftovers within the restrictions of its jurisdiction, to reduce the decision-making role of courts in the arbitral process, to provide that every final arbitral award is enforced in the same manner as if it were the decree of the court, to provide that for purposes of enforcement of foreign awards, every arbitral award made in a country to which one of the two international conventions relating to foreign arbitral awards to which India is a party applies will be treated as a foreign award.
Conciliation
Part III of the Arbitration and Conciliation Act 1996 deals with conciliation. Conciliation means “the settling of disputes without litigation. Conciliation is a process by which discussion before parties is kept going through the participation of a conciliator. The main difference before arbitration and conciliation is that in arbitration proceedings the award is the decision of the Arbitral Tribunal while in the case of conciliation the decision is that of the parties arrived at with the assistance of the conciliator.
Determining an arbitrator’s jurisdiction
An arbitrator has right to make jurisdictional rulings and time length of the consideration of that result that is referred as: jurisdiction on jurisdiction.The principles are identified by the arbitrators may be jurisdictional asking that nothing about who will finally a particular case. After investigating the pertinent information and law an arbitrator may decide to listen the case or refuse to give the matter any further consideration. Moreover, to say that arbitrators may make jurisdictional decisions tells only part of the story and begs two further questions.In the very basic stage, the principle that arbitrators may rule on their jurisdiction serves as calculate to defend against having an arbitration derailed before it begins. The arbitral tribunal need not halt the proceedings just because one side questions its authority. The principle reduces the outlook that measures will be derailed through a simple accusation that an arbitration section is unenforceable. It is very common that in most of the countries recognize that a jurisdictional doubt does not mechanically stop arbitration; very small agreement exists on other aspects of an
arbitrator’s ruling on his authority. An arbitrator’s jurisdictional power derives mainly from national law and institutional rules. Where commentators sometimes refer to the internationally recognized doctrine of Kompetenz-Kompetenz it would be more precise to speak of doctrines in the plural.
The Arbitration Award
As earlier mentioned, the Supreme Court in Enterprise generally outlined the judicial function in reviewing an arbitrator’s award. This theory is discussed by Mr. Justice Douglas’. No enterprise particularly underlined the nexus between contractual allocation of powers to the arbitrator and the award’s strength: An arbitrator is restricted to understanding and submission of the communal bar- gaining agreement; he does not be seated to give out his own word of industrial justice. He may of course look for leadership from many sources, yet his award is justifiable only as it draws its spirit from the communal bargaining agreement. When the arbitrator’s words apparent unfaithfulness to this compulsion, courts have no option but to repudiate enforcement of the award. If an arbitrator is specially made to understand and apply the collective bar- gaining agreement, he is to carry his educated ruling to tolerate in order to reach a fair solution of a dispute. Arbitrators basically have no mandatory obligations to report to the court for the reasons of their award[4]. In very small cases, the award was establish to be too confusing for enforcement and was remanded. Sometimes the situation arises like conflicts between arbitral award and National labor Relations Act (NLRA).The basic problem in this case is the National Labor Relations Board try to avoid reduction of its powers by a sightless and easygoing reception of arbitration as a substitute, rather than subordinate meeting. The second circuit refuses the limitations of the arbitral award existence to the public policy. The majority in American Thread reviewed and discarded the arbitral award in a method which intimately resembled a redetermination of the qualities rather than a judgment of clear breach of contractual constraint[5]. In case of dispute, there is some highly qualified body that argues about the compulsion to negotiate collectively requires a different conclusion. Based on the qualities of the fundamental disagreement by the court on evaluation of an award would come close to fulfilling Judge Hays’ objections to the procedure as it now stands. Sometimes the full review would have the obstruction of being based upon the informal, judicially unmanageable arbitral trial and its ineffectual offspring the award. Judge Hays basically asserted that courts are better outfitted to make right decisions than arbitrators. But he does not offer any verification of what constitutes a wrong award apart from one that a court might possibly have decided in a different way. The necessities relating to the award do not call for comprehensive remark, being necessities more often than not found in arbitration rules drafted for use in international trade. They do however lift a few interesting questions.
Action by arbitrators
In case of arbitral foregoing the parties may agree to clear up their dispute. Under the Rules, an award on agreed terms may then be rendered on demand of both parties if conventional by the tribunal. The last requirement can defend arbitrators in a variety of situations, for example where the resolution violates foreign swap over limitations. An award on decided conditions not mentioned in many arbitration rules and hardly ever provided for in arbitration law may be helpful since the recorded settlement may be compulsory like any other arbitral award. The Rules include additional constructive necessities, not usually create in arbitration policy or in arbitral legislation for complementary action by the arbitrators. Within 30 days after the unloading of the award either party may ask for the arbitrators to construe their award or to accurate in the award “any errors in subtraction, any secretarial or typographical errors, or any errors of similar nature”. Arbitrators might also accurate their award on their individual proposal. Agreement in case of arbitration by a single arbitrator, when the dispute arises and the character of the differences is known, therefore leftovers possible. Agreement on a single arbitrator at the time of the ending of the contract seems not recommended since at that stage, the nature of the disagreement is not yet known. The Rules standardize arbitral procedures cautiously and in detail. In this situation, I can simply contract with the topic in wide outline and illustrate concentration to some extraordinary facial appearance of the Rules. This Rules offer for homework of the case in writing: this involves the announcement of state and the statement of protection. The concluding may hold a counterclaim arising out of the same contract. Amendments to a claim or protection are usually allowed. The arbitral court decides whether additional written statements, in addition to the proclamation of claim and the statement of protection, shall be compulsory and will again attach the periods of time for connecting such statements. If we talk about the appointment of an arbitrator then it is not disqualified but it might not happen frequently. A provision in the Rules might infringe the national public policy of a State concerning familial arbitration and yet not be opposing to that State’s public policy concerning international commercial arbitration. In this cases connecting international commercial arbitration, many local courts have concluded that special considerations of public policy are appropriate which free the arbitrator from rules applicable to local procedures
Concluding Remarks
After discussing everything we can conclude that according to the arbitration and conciliation act, 1996, an arbitrator has the rights or jurisdiction to amend his awards. Judicial willingness to implement agreements to arbitrate constitutional claims has left opponents with small recourse to challenge arbitration agreements between one shot and replicate players. While unconscionability remains a legitimate basis for demanding one sided arbitration agreements, opponents of arbitration of statutory claims have twisted toward the state action policy as a means for infusing arbitration with greater due procedure. The consequence is that any party is allowed to oppose arbitration and power the lobbyist to go to court to get an initial strength of mind of arbitrability. At least the employer, in the circumstances where he reserves the jurisdiction question is conserving that first step. He may be making it needless. It may be that he will triumph in the arbitration and then we can forget about the court suit. Authorization that the parties agreement and not something odd to collective bargaining, is the means to judicial reverence is to be found in the conduct accorded to commercial arbitration awards. The courts have detained that they will not appraisal the qualities of arbitral awards in commercial settings and will look only at technical equality, fraud, partiality or total illogicality. The contractual natural world of the arbitration process is harassed in most opinions. There is one major requirement to the determination doctrine. In agreement to arbitration, the parties were allowed to take for granted that the arbitrator would act honestly that his award would not be contaminated by fraud or corruption.
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International Documents
ICSID Rules of Procedure For Arbitration Proceedings (Arbitration Rules).
International Chamber of Commerce Arbitration Rules, 1998, [Entry into effect: 01.01.1998].
Permanent Court Of Arbitration Optional Rules For Arbitration Between International Organizations And Private Parties, [Entry into effect: 01.07.1996].
Permanent Court Of Arbitration Optional Rules For Arbitrating Disputes Between Two States., [Entry into effect: 20.10.1992].
Permanent Court Of Arbitration Optional Rules For Arbitrating Disputes Between Two Parties Of Which Only One Is A State., [Entry into effect: 03.07.1993].
Permanent Court Of Arbitration Optional Rules For Arbitration Involving International Organizations And States., [Entry into effect: 01.07.1996].
The Convention on the Recognition and Enforcement of Foreign Arbitral Awards, [10.07.1958]
The London Court of Arbitration (LCIA) Arbitration Rules, 1998, [Entry into effect: 01.01.1998].
United Nations Commission on International Trade Law Arbitration Rules, 1976, [Adopted by UNCITRAL on 28.04.1976, and by the United Nations General Assembly Resolution 31/98, dated 15.12.1976].
United Nations Commission on International Trade Law Model Law on International Commercial Arbitration, 1985, [Adopted by UNCITRAL on 21.06.1985, and by the United Nations General Assembly Resolution 44/72, dated 11.12.1985].
National Legislation
The Arbitration And Conciliation Act, 1996, [No.26 of 1996] (16th August, 1996).
Books
Lew, J., Comparative International Commercial Arbitration, [London: Kluwer Law International, 2003].
Moss, G.C., International Commercial Arbitration, [Norway: Tano Aschehoug, 1999].
Redfern, A., et al, Law and Practice of International Arbitration, 4th Ed, (London: Sweet & Maxwell, 2004).
Reisman, W.M., International Commercial Arbitration. Cases, Materials and Notes on the Resolution of International Business Disputes., [New York: The Foundation Press, Inc., 1997].
Rubino-Sammartano, M., International Arbitration Law and Practice, 2nd Rev. Ed, (The Hague, Kluwer Law International, 2001).
Tweeddale A., & Tweeddale K., Arbitration of Commercial Disputes., [United States: Oxford University Press, 2005]
[1] St. Antoine, Discussion—The Role of Law in Arbitration, in Developments in American and Foreign Arbitration, supra note 1, at 75, 82.
[2] Redfern, A., et al, Law and Practice of International Arbitration, (4th Ed), 6, (London: Sweet & Maxwell, 2004)
[3] This being the core of this paper is discussed in detail, infra.
[4] Id. at 598 (footnote omitted
[5] Compare United Furniture Workers v. Virco Mfg. Corp., 50 L.R.R.M. 268I (E.D. Ark. I962); cases cited note 46 infra.