Moral Misconduct of an Arbitrator I

Under Section 30(a) of the 1940 Arbitration Act, an Arbitral Award can be set side if the Arbitrator has “misconducted himself or the proceedings”. In K.P. Poulose, (1975) 2 SCC 236 it was held, “misconduct under Section 30(a) has not a connotation of moral lapse. It comprises legal misconduct which is complete if the Arbitrator on the face of the Award arrives at an inconsistent conclusion even on his own finding or arrives at a decision by ignoring very material documents which throw abundant light on the controversy to help a just and fair decision.

Recently, in Cochin Shipyard Ltd. v. Apeejay Shipping Ltd., [Civil Appeal No. 9187 of 2015] a series of decisions were referred to appreciate the concept of misconduct and how a party is entitled to make it the fulcrum of assail in his objection under Section 30(a). Misra and Pant JJ. specifically declined to enter upon a discussion pertaining to any moral misconduct of an Arbitrator or its relevance.

Can the moral disposition of an Arbitrator color his Award, some of the times that his morality is under scrutiny? The prescription of Parbati Kumar Goswami J. in Polouse shall surely be revisited.

In Ferro Concrete, (2009) 12 SCC 1 it was considered notably, “under the Arbitration Act, 1940 when there is no allegation of moral misconduct against the Arbitrator with reference to the Award, and where the Arbitration has not been superseded, there were only two grounds of attack. First was that there was legal misconduct on the part of the Arbitrator in making the Award. Second was that there was an error apparent on the face of the Award.”

An allegation of moral misconduct against an Arbitrator, in proceedings being held under the 1940 Arbitration Act, is thus a ground of attack. The Gold Fish Arbitrator!

Gold Fish

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