Supreme Court lauds Bombay High Court practice of appointing young lawyers as arbitrators

Bombay High Court. File pic

The Supreme Court has lauded the Bombay High Court's practice of appointing young lawyers as arbitrators, saying it helps in training them in alternate dispute redressal mechanisms.

Hearing an arbitration dispute on fixing the price of cylinders, a bench of Justices D Y Chandrachud and M R Shah said on Friday that it's good both parties have agreed on a common name for the process.

"Bombay High Court has now started a practice of appointing young knowledgeable lawyers as arbitrators at minimal cost. These young lawyers take it as an honour being appointed by the high court. They do the work diligently and complete it in two-three sittings. They even charge less as compared to others and are doing an enormous job," the bench said.

Justice Chandrachud recalled an incident when he was a judge in the Bombay High Court and a person was appointed as arbitrator.

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"Soon, both the parties came to us and said with folded hands we are requesting you to change the arbitrator" (saying) he is seeking more fees than what has been fixed by the court. So we directed that fees will be charged as per the schedule. You see this is the problem."

The bench said when it appoints an arbitrator now, it specifically mentions that fees are to be charged according to the schedule.

The counsel for a firm called Supreme Cylinders Ltd said arbitral proceedings have been pending since 2017. The arbitrator appointed by the court, he added, is repeatedly giving adjournments on one pretext to another despite charging for each sitting.

He told the court that it would be better if some other sole arbitrator was appointed and the matter decided without any adjournments.

The counsel said he wants the fixing of the prices of cylinders by Bharat Petroleum to be done urgently as repeated adjournments in arbitration proceedings is affecting his client's business.

After hearing the parties, the top court ordered, "In substitution of the Arbitrator, who was appointed by the order of this Court dated April 24, 2017, all the disputes and differences between the parties are referred to the sole arbitration of Justice Naresh H Patil, former Chief Justice of the High Court of Judicature at Bombay".

It said the proceedings shall commence from the stage reached before the previous arbitrator and the arbitral award is to be made after hearing final arguments on the basis of the evidence already placed on record.

The top court said that in view of the stage which has been reached in the arbitral proceedings, the fees of the arbitrator are fixed at a lump sum of Rs 15 lakh. The amount shall be shared between the contesting parties: the respondents (Bharat Petroleum) shall bear 50 per cent of the amount, while the claimants (Supreme Cylinders Ltd) shall share the balance 50 per cent in equal proportion.

It said no refund is being claimed of the fees already paid to the previous arbitrator, and no further amount shall be payable towards fees, costs and expenses.

"In view of the fact that the arbitral proceedings are pending since 2017, the newly appointed arbitrator is requested to expedite the proceedings and to deliver the arbitral award preferably within a period of four months from the date of receipt of a certified copy of this order. All the parties have agreed to cooperate with the time schedule which has been fixed by the arbitrator without seeking adjournments," the bench said.

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