Arbitrator – Powers to appoint Sole Arbitrator as against Agreement for Tribunal of 3 Members

Agreement between the petitioner and the respondent for security solutions as per the Agreement dated 20.11.2020.

The agreement was terminated. However, the respondent did not clear pending payments and arrears.  By the notice dated 3.6.2023, the petitioner invoked the arbitration. The petitioner disputed existence of disputes but nominated former Judge as the Arbitrator. The petitioner informed that in view of the arbitration agreement, a third arbitrator can be nominated by the respective Arbitrators. 

The petitioner filed petition for appointment of an Arbitrator in addition to the Arbitrators nominated by the parties.

The respondent opposed the petition that it has already proposed one Arbitrator, the petitioner is proposing name of another Arbitrator and then both Arbitrators can nominate third Arbitrator.   It was, therefore, contended that the petition is premature since the parties fail to follow procedure.

HELD that clause 7 of the arbitration agreement provides for appointment of sole Arbitrator and only if there is no consensus then they may go for three Arbitrators panel.  Since there was no consensus on sole Arbitrator, the petition is not premature.  The Court is vested with any powers to appoint Sole Arbitrator in distinction to the Arbitration Agreement for Tribunal of three members.

Judgment dated 22.5.2024 of the Delhi High Court in ARB.P.24/2024 of M/s Twenty-Four Secure Services Pvt Ltd  Vs. M/s. Competent Automobiles Company Limited