A brief summary of the five important judgments on arbitration, given in 2022 by the Supreme Court of Bangladesh (High Court Division).
AGROCORP INTERNATIONAL PTE LTD. VS. VIETNAM NORTHERN FOOD CORPORATION
Reference: 27 BLC (2022) HCD 20
Legal Provision: Section 12 of the Arbitration Act, 2001
Legal Question: In the absence of an Arbitration Agreement, can the Court entertain an application for the appointment of arbitrators?
Held: In order to make the provisions of sub-sections (1) to (13) under section 12 of the Act applicable, the parties must agree to resolve any dispute through arbitration. The absence of an agreement among the parties to hold arbitration shall render the provisions of the Act nugatory. … The very meaning of the terminology ‘arbitration agreement’ is the voluntary consent of the parties concerned for making an arrangement for the resolution of their present or future dispute outside the court, there must be the existence of a written agreement invoked previously or at any time after arising any dispute between the parties.
GAS TRANSMISSION COMPANY LTD. VS DRILLTEC-MAXWELL JOINT VENTURE
Reference: 27 BLC (2022) HCD 222
Legal Provision: Section 43 of Arbitration Act, 2001
Legal Question: Can an Arbitration Award, or its proceedings be challenged due to non-signature of the minority arbitrator?
Held: The scheme of the law is that an arbitral tribunal proceedings and it’s ultimate outcome cannot be jeopardized, spoiled, or frustrated in any manner due to the non-availability of the minority arbitrator after his lawful participation in the arbitral proceedings, or because of his unwillingness to sign on the awards at the end of the arbitration. In that scenario, the only duty of the majority arbitrators to state the reason as to absence of thesignature of the Minority Arbitrator.
When an arbitrator finishes and leaves of arbitration without delivery of the dissenting opinion/decision either in the last part of the majority word or in a separate sheet, s/he cannot be considered to have performed the duty of an arbitrator, albeit it may not have the consequence of vitiating the proceedings of the arbitration. In the event that the dissenting arbitrator avoids/fail to perform his obligation of recording his findings and reasonings, either party of the arbitration is well competent to seek refund of the partial fees on the ground of being deprived of getting the findings and reasoning of the arbitrator towards taking the next legal step.
For the reason of non-delivery of a writer by the minority arbitrators the award is not rendered invalid and thus, is not liable to be vitiated.
BANGLADESH CHEMICAL INDUSTRIES CORPORATION VS. M/S MONSUR AND BROTHERS
Reference:74 DLR (HCD) 557
Legal Provision: Section 42, 43 of the Aritration Act, 2001
Legal Question: How far can the District Court interfere with an arbitral award?
Held: The power of the court of District Judge in interfering with an arbitral award is very limited, which is circumspected by different clauses under Sub-Section (1) of section 43, such award cannot be canceled by the District Judge beyond such provisions, and, in exercising jurisdiction under section 42(1) of the act, the District Judge cannot act as an appellate court. This being so, since the District Judge concerned has not found any such materials in the awards that the same suffer from the mischiefs as provided by section 43 of the Act, it has had no option but to dismiss the miscellaneous cases filed by the applicant.
An award may be termed as contrary to the public policy only if any patent illegality is found therein and the patent illegality is such a legality which is so unfair and unreasonable that it shocks the conscience of the Court.
ACCOM TRAVELS AND TOURS LIMITED VS OMAN AIR SAOC
Reference: 27 BLC (2022) HCD 596
Legal Provision: Section 7, 7A and 10(2) of the Arbitration Act
Legal Question: Can the parties challenge a contract (and how far) in the Courts of Bangladesh, where the Contract provides for a foreign-seated arbitration?
Held: When the parties to an agreement agree to resolve their disputes through arbitration and they agreed that such arbitration will be conducted in accordance with the law of a foreign country, thereby, excluding the jurisdiction of the Courts of Bangladesh in favour of the jurisdiction of the courts in that foreign country, such parties should not be allowed to take recourse to litigations in Bangladesh in respect of the subject-matter of such arbitration agreement. Not only that such practice is against the terms agreed by them, such practice might also result in conflicting decisions between arbitration tribunal in it or any country and a court in Bangladesh.
Except the provisions under section 45-47 and section 7A, to some extent (after filing for an arbitral award for the court of District Judge, Dhaka seeking enforcement), the provisions of the Arbitration Act 2001, including the provision under Section 7, will not be applicable in respect of an arbitration where the seat of arbitration is in a foreign country.