The Mumbai Centre for International Arbitration (MCIA) proudly announced India Alternative Disputes Resolution Week 2024 (IAW 2024) from 23rd September to 28th September 2024. The transformative initiative brings together best practitioners to discuss Alternative Dispute Resolution (ADR) across three key jurisdictions: Bengaluru, Mumbai, and Delhi.
Kicking off in Bengaluru on September 23, 2024, IAW 2024 is nearing the conclusion in Delhi om 28th September 2024.
The IAW aims to discuss the international best practices in alternative dispute resolution bringing together seasoned practitioners, legal professionals, scholars, and industry experts to brainstorm and arrive at some meaningful and constructive solutions to pertinent challenges.
The first panel on ‘Anti-Suit & Anti-Arbitral Injunctions – The Achilles Heel of International Arbitration?’ was moderated by Ms. Sheila Ahuja, Partner A&O Shearman and Co Head of India Group.
Ms. Sheila posed a question, that whether Courts were right in granting the anti-enforcement injunction and anti-arbitration injunction on grounds of non-arbitrability in Bina Modi Case (Lalit Modi)? The question raised in the appeal was- whether an anti-arbitration injunction could have been granted.
Justice (Retd.) Mr. S. Ravindra Bhat, Former Judge, Supreme Court of India viewed that, the result could have been different, if a different perspective from the lens of Section 45 would have been taken. He added that it also depends on which premise the matter started from, and in this matter, it was a Singapore seated arbitration.
Taking a cue from Justice Bhat’s answer Ms. Sheila tweaked the question- what if there was an express choice of law governing the arbitration agreement, and it was Indian law? He viewed that in an anti-suit, anti-enforcement issue of whether the foreign seated Court’s injunction orders are honoured here or not, must be explored.
Mr. Prashanto Chandra Sen, Senior Advocate; Quadrant Chambers candidly answered that, such choice would have changed the answer. He highlighted that Singapore has a separate law dealing with International Commercial Arbitration, which defines public policy quite widely and considers foreign policy of other jurisdictions, as well.
Ms. Charanya Lakshmikumaran, Executive Partner, Lakshmikumaran & Sridharan, addressing the question on what view Indian Courts would take if the Shareholders Agreement were governed by foreign law, reflected that there is a threshold of Section 48, therefore, the view taken by the Court (conclusion) would have been the same.
Ms. Anuradha Dutt, Founder and Senior Partner, DMD Advocates suggested that there should be separate arbitration Bar and dedicated Benches in Supreme Court and High Courts. She stated that- “as long as India requires investment, any businessman who’s coming from outside India will insist on arbitration because the delays in our judicial system are well known.”
The much-anticipated Session 2 officially commenced, diving into critical aspects of modern arbitration practices. Titled “Arbitration Spells Innovation with an E,” this session will cover emergency, expedited, early dismissal, and enforcement procedures, all while sharing invaluable tales and war stories from industry experts.
This session was moderated by Vijayendra Pratap Singh, Senior Partner & Head of Dispute Resolution at AZB & Partners, explored innovative arbitration practices, focusing on emergency, expedited, early dismissal, and enforcement procedures, sharing real-world insights and experiences.
This session features an esteemed panel of speakers including Justice (Retd.) Mrs. Hima Kohli, Former Judge of the Supreme Court of India; Mark Mangan, Founding Partner at Lindsay Francis & Mangan; Emiko Singh, Partner at White & Case LLP; Chaitanya Arora, Managing Director at Secretariat, Singapore; and Mudita Roy, Associate General Counsel at Akasa Air.
Mr. Singh remarked on the significant impact of the Emergency Arbitration (‘EA’) in India’s arbitration landscape, highlighting that since 2010, the Singapore International Arbitration Centre (SIAC) has received and accepted 152 applications for EA, successfully appointing arbitrators. Notably, EAs have granted relief in 50% of these cases, effectively diverting disputes that would otherwise have gone to court. He then posed a question to Justice Kohli: “Judge, do you think that the Emergency Arbitrator can serve as an effective docket management tool to meet the need for interim relief and help reduce the burden on the courts?”
Justice Hima Kohli responded with a prompt yes, emphasizing that the concept of the EA holds tremendous potential as an effective docket management tool. She highlighted its growing significance, particularly in the context of the Amazon.Com NV Investment Holdings LLC v. Future Retail Ltd., , where the EA enables parties to secure urgent relief even before the establishment of a formal Arbitral Tribunal. This capability can significantly divert cases from overburdened courts and address urgent needs efficiently.
For EA to realize its full potential, Justice Kohli suggested that future legislative clarity could be beneficial, as current interpretations largely stem from judicial decisions rather than explicit provisions in the Arbitration and Conciliation Act. She concluded that broader acceptance of EA within the Indian business community, alongside consistent judicial enforcement of emergency awards, will be crucial to its success.
Mr. Singh then posed a question to Ms. Emiko Singh: “What makes you recommend the Emergency Arbitrator (EA) route over the court route to your clients? Would your view change depending on the jurisdiction?”
Emiko elaborated on the growing recognition by institutions and national courts of the need for interim or urgent relief within arbitration. She noted that ten years ago, very few institutions offered Emergency Arbitration, whereas now, almost all do, marking a positive development.
However, she emphasized that the recommendation of the EA route ultimately hinges on two critical factors: how courts recognize these mechanisms and how enforceable the resulting orders are. She stressed that the Clients need assurance that the interim relief granted by an Emergency Arbitrator will be upheld in practice.
Sharing her experience, Emiko recounted a successful case involving a London-seated arbitration, where her team obtained effective relief within three weeks of requesting an Emergency Arbitrator. Remarkably, the opposing party withdrew their proceedings upon receiving the order, eliminating the need for enforcement.
Emiko concluded by expressing hope that increased clarity in national legislation regarding Emergency Arbitration will lead to wider acceptance and use of this valuable tool, ultimately enhancing its effectiveness as a dispute resolution mechanism.
Mr. Singh then directed his question to Mr. Mark Mangan: “What factors do you consider when deciding on an EA application, especially given your extensive experience with approximately 25 such cases? In your view, how effective is an EA in preserving the status quo?”
Mr. Mark Mangan delved into the factors considered by an EA when evaluating requests for emergency relief. Noting that approximately 50% of EA applications succeed under SIAC rules—an observation he echoed from his own experience—Mark emphasized several key criteria:
Applicable Law: The EA must first establish the relevant legal framework for assessing the request for interim relief, which often varies by jurisdiction.
Criteria for Relief: Generally, two primary factors need to be demonstrated:
Prima Facie Case: The applicant must show a prima facie case on the merits, or what some jurisdictions refer to as a “serious issue to be tried.”
Balance of Convenience: The applicant must establish that the balance of convenience favors granting relief, which encompasses concepts like balance of hardships, proportionality, and the risk of irreparable harm.
Atmospheric Factors: Mark highlighted that contextual element, such as evidence of the respondent acting unreasonably, ignoring prior tribunal decisions, or attempting to dissipate assets, can significantly influence the EA’s decision-making.
In conclusion, Mark underscored the importance of tailoring the approach to the specifics of each case, acknowledging that different categories carry unique considerations that must be respected.
Mr. Singh then posed a question to Ms. Mudita Roy: “How do you think the EA mechanism works within the aviation sector?”
Mudita elaborated on the significance of the EA mechanism in the context of business exits, emphasizing the need for speedy resolutions, especially in cases involving confidential information or sensitive business secrets. She noted that the innovation of the EA provides an option that was previously unavailable, allowing parties to seek urgent relief without waiting for a formal tribunal to be constituted.
Highlighting the fast-paced nature of the aviation sector, Mudita stressed the adaptability of the EA process, which is crucial for addressing operational disruptions. In her experience, the quick turnaround—often within seven days—enables companies to maintain their competitive edge while safeguarding sensitive information.
She also pointed out the complexities that arise from multiple related contracts within the industry, where disputes may span different jurisdictions or contractual frameworks. For instance, in cases involving energy manufacturers or subsidiaries across various locations, the ability to resolve disputes efficiently and effectively becomes paramount.
In conclusion, Mudita emphasized that the EA mechanism is critical for evolving arbitration practices, particularly in industries where traditional dispute resolution processes may fall short. She reiterated the importance of innovation in arbitration to keep pace with the demands of modern business environments, where timely resolutions are essential for successful operations.
Mr. Singh then turned to Justice Kohli, asking, “Have you ever encountered a situation where enforcement proceedings become a de facto appeal of the arbitral award?”
Justice Kohli began with a caveat that her response would focus on domestic arbitration. She stated that, personally, she has not encountered situations where enforcement proceedings became a de facto appeal of an arbitral award, attributing this to her proactive role in guiding parties to avoid such scenarios.
She emphasized that this question touches on a critical issue in Indian arbitration law, which increasingly respects the finality and sanctity of arbitral awards while ensuring justice and fairness. Justice Kohli highlighted that an arbitral award, once made, should be treated like a decree to be enforced as any civil court decree would be.
She pointed out that the Arbitration and Conciliation Act, 1996 especially following the amendments in 2015 and 2019, aims to minimize judicial interference during enforcement. Justice Kohli stressed the need to draw a clear line between judicial review and enforcement of awards that have attained finality. She articulated that enforcement courts should not engage in the merits of the dispute, reinforcing that enforcement should not morph into an appellate review.
Justice Kohli acknowledged that while there have been cases interpreting public policy under Section 34, such considerations should not serve as a basis to reargue the merits of the case during enforcement. The judiciary’s approach, she concluded, should remain circumspect, strictly adhering to the limited grounds for interference under Section 34 while ensuring that enforcement proceedings are not misused as a means to challenge arbitral awards.
Mr. Singh then posed a question to Mr. Chaitanya Arora: “Expert usage in international arbitration is an idea that has come to stay. Considering experts as an innovation to enhance efficiency, economy, and effectiveness—aligned with my E-theme—where do you see the new frontiers of ‘Expert 2.0,’ and how do you envision it playing out in the near future?”
Chaitanya began by acknowledging that the use of experts in arbitration is well-established, both in India and internationally, with provisions in the 1996 Arbitration Act supporting their inclusion. He noted a historical reluctance among parties, especially in domestic arbitrations, to utilize expert evidence. However, given the increasing complexity of transactions, cross-border trade, and evolving technologies—such as cryptocurrency—there is a compelling need for expert input in arbitration proceedings.
He highlighted that the landscape has evolved over the past 10 to 15 years, with a growing familiarity and acceptance of experts’ roles. Rather than debating the necessity of experts, the focus has shifted to when to engage them. Chaitanya pointed out that innovations in funding have influenced the timing of expert appointments, particularly regarding damage assessments and valuations, which are crucial for parties determining the worth of their disputes.
He introduced the concept of a “dirty expert,” a term used to describe an expert working closely with counsel, often to refine legal strategy or identify independent experts for the case. This approach is particularly useful in specialized fields, like nuclear technology, where only a handful of true experts exist, making it challenging to find unbiased expertise.
Chaitanya raised a critical question about the necessity of expert evidence, noting that parties sometimes question the value of paying for external expertise when internal teams could handle the work. He cited the ICC Commission’s recommendation that expert evidence should not be presumed necessary and should only be used if it is critical to the outcome of a dispute. Despite this, he observed that parties often appoint experts without adequately assessing the necessity of their involvement.
Looking ahead, Chaitanya expressed curiosity about how emerging technologies, particularly artificial intelligence, might further impact the role of experts and the nature of expert evidence in future arbitration proceedings. He concluded that as the legal landscape continues to evolve, the integration of expert insights will remain vital for addressing the complexities of modern disputes.
SESSION 3 moderated by Ms. Varuna Bhanrale, Partner, Trilegal, focused on ‘Emergency Arbitration 101: Latest Trends and Developments’, which has drawn a lot of traction in recent times. Diving straight into the discussion she asked whether emergency arbitration is required or is necessary when other avenues for getting urgent interim relief are available.
Ms. Rebecca James, Partner, Linklaters, Singapore stated that- “Emergency Arbitration is a very useful tool or mechanism, that has real additional advantages, but it is being terribly used and it is the use of the mechanism, creating the problem.” Discussing the benefits of emergency arbitration, she highlighted that the arbitrator is appointed within a day or couple of days, and sometimes, the award comes out within few days or couple of weeks. However, she pointed that it also depends on the jurisdictions that are being dealt with. She also reflected that ‘trust’ and ‘confidence’ are key factors pushing the parties to choose emergency arbitration over adjudication before Courts. Furthering the discussion, she highlighted that ‘confidence’ is another factor that pushes parties to bank on arbitration.
Ms. Tine Abraham, Partner, Trilegal echoed Ms. Rebecca’s views. Taking a slightly different path, she observed that, interim relief, as a concept is extremely critical and more the avenues/ forums to seek that interim relief, the better it is. She underscored that it is important to see that how these avenues are approached, and how they are being utilised. The primary advantage of having multiple forums as a choice, is that it gives the party seeking interim relief, the option to choose from these multiple forums.
Mr. Avnit Arora, Director (Arbitration & Conciliation), Department of Legal Affairs, Ministry of Law & Justice agreed that the time for Emergency Arbitration has come. She suggested that the option of exploring Emergency Arbitration should be there with the parties, as party autonomy is the bedrock of arbitration. She added that India is predominantly engaged in ad hoc arbitration and Emergency Arbitration is predominantly an offshoot of institutional mechanism.
Day 5 of IAW 2024 in Delhi to be updated.
*Disclaimer: The transcripts have been provided by TERES.
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