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., (2022) 1 SCC 209, 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.
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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. Tine Abraham, Partner, Trilegal 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.
Session 4 with theme “Witness Evidence and Preparation in International Arbitration: Cross-Cultural Perspectives” featured an esteemed panel of speakers, each bringing unique expertise to the discussion. Moderated by Sanjna Pramod, Senior Associate at Clifford Chance, this session explored the varying expectations and communication styles that witnesses bring from their respective backgrounds. The speakers for this session include Richa Kaushal, Senior Associate at Clifford Chance; Nakul Dewan, Senior Advocate and Barrister at Twenty Essex; Ila Kapoor, Partner at Shardul Amarchand Mangaldas; Sachin Trikha, Partner at Clifford Chance; and Ajay Kharbanda, Chief Legal Officer for North and West Sector at GMR Airports.
The panel discussion had four main goals. First, the speakers shared insights from their experiences in India, Singapore, the UK, and New York highlighting the differences and similarities in witness evidence and preparation. Second, they discussed the challenges faced by arbitrators and provide practical tips for practitioners. Third, the panel examined the specific challenges in-house counsel encounter when managing witness evidence during arbitration. Finally, they explored effective strategies for presenting clients’ cases persuasively while considering cultural nuances.
Starting with the panel discussion, Ms. Sanjna Pramod, Senior Associate at Clifford Chance, posed a question to Ms. Ila Kapoor, Partner at Shardul Amarchand Mangaldas: How does the comprehensive witness preparation process in the U.S., which includes significant interaction and coaching between lawyers and witnesses—often viewed as essential for effective representation and potentially linked to malpractice—compare to the approach taken in India, where there is typically a greater emphasis on the witness’s natural testimony and authenticity?
Ila responded by stating that the perspective presented is a biased UK opinion. In New York, coaching is explicitly prohibited under the New York Bar Rules and professional conduct guidelines. While lawyers can meet with witnesses, prepare them, and even conduct mock trials, the rules clearly define what lawyers can do regarding witness preparation without dictating what they should say. There have been cases where lawyers were disbarred for crossing this fine line, such as when they wrote out answers for witnesses, which was then revealed in court.
In her experience at a New York law firm, many partners were cautious about where this line lies, often relying on the partner’s judgment. She recalled an instance where a partner told a witness to simply read their statement and tell the truth, which ended disastrously during cross-examination.
In contrast, she mentioned that India lacks specific guidelines for witness preparation, placing the responsibility on individual lawyers to determine what is appropriate. In India, it ultimately falls to each lawyer to set their own boundaries regarding witness preparation, rather than adhering to established professional rules.
Ms. Sanjna turned to Mr. Sachin Trikha, Partner at Clifford Chance and noted that in the UK, the general perception is that interaction between lawyers and witnesses is more restricted. The primary rule emphasizes that witnesses must provide their own truthful and independent accounts of the events in question. She asked him to elaborate on this perspective and how it shapes the approach to witness preparation and testimony in the UK legal system.
Mr. Sachin responded by affirming that the summary of the position in England is quite accurate and expressed reassurance about Ila’s comments on New York. He acknowledged the common fear when facing American law firms, where it seems they might be coaching witnesses and experts on exactly what to say. However, he clarified that the situation is more nuanced.
He mentioned that in England, there are clear guidelines and rules governing solicitor conduct, particularly outlined in the SRA Code of Conduct. One key rule states that lawyers should not influence the substance of witness or expert evidence. This means that when gathering witness statements, it’s crucial that the evidence reflects the witness’s own account. During preparation for hearings, lawyers must be careful not to contaminate or manufacture evidence, as this is a serious violation of conduct rules. While some lawyers may bend these rules, the default position is set by the established guidelines. Sachin then addressed the broader question of whether this strict approach is beneficial. He argued that while lawyers often want control over every aspect, a more holistic view is necessary. In striving for a just outcome, the tribunal should not be aided by manufactured evidence, which lacks credibility. He emphasized that a skilled cross-examiner will uncover the truth, making coaching unfair to the witness, who may become confused about what is genuinely true versus what they are expected to say. In his view, the existing rules in England are sound and serve the pursuit of truth in the legal process.
Continuing the discussion, Ms. Sanjna asked Mr. Nakul Dewan, Senior Advocate and Barrister at Twenty Essex, whether Singapore typically aligns with the UK position on witness evidence and preparation, or if it is more influenced by the practices described by Ms.Ila in New York.
Mr. Nakul Dewan responded that Singapore is quite adaptable and tends to adopt the best practices from various jurisdictions. In terms of witness evidence, it aligns more closely with the UK position. This alignment is largely due to the historical influence of UK rules on Singapore’s court procedures and legal professional conduct. Singapore has its own legal professional conduct rules that outline how lawyers should draft witness statements and prepare witnesses.
He noted that while these rules may seem logical, many lawyers still struggle with effectively preparing and finalizing witness statements. This suggests that even with clear guidelines, there can be challenges in implementation during the preparation process.
Mr. Nakul Dewan elaborated on several key points regarding witness statements in Singapore. First, he emphasized that witness statements must only include facts within the witness’s personal knowledge, yet it’s not uncommon to find statements that include matters the witness is unaware of.
Second, he highlighted that lawyers are not required to doubt a witness’s statement of fact. Instead, they should accept it and use it constructively in their case arguments.
Ms. Sanjna asked Mr. Ajay Kharbanda, Chief Legal Officer for North and West Sector at GMR Airports, about his expectations as in-house counsel from external lawyers and senior advocates to enhance the efficiency of the witness preparation process. She inquired whether he finds practice runs useful and what specific strategies have proven effective for him and his team in this context.
Third, he pointed out the crucial rule that lawyers cannot encourage a witness to provide false evidence. If a witness’s account contradicts existing documents, the lawyer has an obligation to inform the witness that their statement may not be accurate.
Regarding preparation, he stated that while practice runs are allowed, bringing all witnesses together for a coordinated practice session is prohibited. This restriction stems from past incidents where lawyers attempted to influence witness testimony during preparation, leading to a notable court judgment that highlighted these ethical breaches.
In summary, Mr. Kharbanda noted that Singapore’s approach mirrors the UK by disallowing coaching and influencing, while still permitting preparatory practices that align with ethical standards during witness statement drafting.
Richa Kaushal, Senior Associate at Clifford Chance, noted the critical relevance of lay witness evidence in international arbitration, emphasizing that such testimony can significantly influence the outcome of proceedings. Acknowledging the importance of getting it right, she turned to Mr. Nakul Dewan and asked him what specific strategies he believes lawyers and parties can employ to ensure the credibility and reliability of lay witness evidence during arbitration.
She posed a very pressing question to the panelists, prompting a thoughtful discussion, and ended the session on an insightful note, highlighting the importance of effective witness evidence in international arbitration.
Day 5 began with great enthusiasm.
Session 1 featured welcome remarks by Justice L. Nageshwar Rao, a former Judge of the Supreme Court of India and an International Arbitrator at 39 Essex Chambers. The session was moderated by Divij Kumar, a Partner at IndusLaw. The speakers included Avimukt Dar,Founding Partner of IndusLaw; CV Raghu, General Counsel of Motherson Group; Shujath Bin Ali, Global General Counsel and Chief Compliance Officer at Re Sustainability Limited; and Priyanka Walesha, Head of Legal at Yum Brands, Mayank Mishra, Partner, IndusLaw.
The panel delved into an engaging lineup of discussions and insights, focusing on the topic, “Time is the Essence of Arbitration – Remedies India Needs to Undertake.”
Justice L. Nageshwar Rao shared his perspective as an arbitrator rather than as a judge, reflecting on his two and a half years of experience in arbitration. He emphasized the critical importance of time in arbitration, addressing the challenges faced and proposing potential remedies.
He noted that all stakeholders contribute to the current situation where time is not prioritized in arbitration. Delays begin right from the moment parties decide to invoke an arbitration clause. A significant issue arises when parties in India struggle to agree on appointing arbitrators, often leading them to seek court intervention under Section 11(vi) of the Arbitration Act. Despite a Supreme Court directive to resolve these applications within twelve months, he highlighted that many high courts, aside from Bombay and Delhi, have applications pending for two to three years, with some taking even longer.
Justice Rao pointed out that the backlog is largely due to the Chief Justices of high courts prioritizing more pressing matters, often leaving 11(vi) applications unaddressed for extended periods. He recounted an instance in the Bombay High Court where a Chief Justice allocated these applications to colleagues, resulting in their resolution within six months, suggesting that similar approaches could be beneficial in other high courts.
Furthermore, he raised concerns about the tendency to appoint primarily retired judges as arbitrators, criticizing this practice as creating an ‘old boys’ club. He advocated for a more inclusive approach that would allow lawyers to participate as arbitrators, urging the need for a balanced and diverse representation in arbitration appointments.
Justice Rao highlighted that institutionalization could address many challenges in arbitration. He noted that delays often occur despite the provisions of Section 29A, which mandates timelines for pleadings and arbitration completion. While some arbitrators may be responsible for these delays, he highlighted that counsel representing parties often play a significant role as well. Requests for extensions are common, and few cases meet the six-month deadline for pleadings.
He pointed out that many senior counsels prefer afternoon hearings or only work on weekends, which complicates the arbitration process. Justice Rao called on members of the Arbitration Bar to take their roles seriously and to shift the culture of arbitration from being seen as an ancillary activity to litigation.
He also criticized the cross-examination process in arbitrations, describing it as often excessive and largely focused on documentary evidence. He observed that international arbitration typically operates under tighter timelines, suggesting a need for a cultural shift in India where lawyers take longer to complete their arguments.
Furthermore, Justice Rao addressed the role of clients in perpetuating these issues, stating that many seek arbitrators who will favor them, akin to behaviors seen in litigation. He urged law firms to resist appointing arbitrators who are inefficient or incompetent, asserting that this change is essential for improving the system. Without such reforms, he warned that the state of arbitration would remain stagnant, much like it has over the past decades.
Following this, the panel discussion commenced.
Mr. Divij asked Mr. CV Raghu: “Could you share your insights on how the arbitration regime has evolved from 1940 to 1996, and what impact the subsequent amendments have had? How effective do you find the current arbitration framework?”
Mr. CV Raghu touched on some fundamental concept and highlighted that if ADR mechanisms start to resemble the judicial process, they cease to be truly ‘alternative.’ The very reason for the inception of arbitration and mediation was to provide an efficient alternative to the judicial system for resolving disputes. Typically, arbitration deals with commercial disputes, which don’t require deep legal philosophical debates; they simply need to be resolved quickly.
However, mirroring Justice Nageshwar Rao, he pointed out, that the process is often plagued by delays—sometimes taking up to two years just to appoint an arbitrator. The industry is not fond of lengthy litigation. Arbitration has become akin to traditional disputes, dragging companies into lengthy court processes.
Mr. Divij questioned Mr. Shujath Bin Ali and Ms. Priyanka Walesha, asking for their perspectives on the appointment of arbitrators. He specifically inquired about their recommendations for improving the process if institutional appointments are not deemed effective, particularly regarding appointments made by courts or directly by the parties involved.
Priyanka emphasized the challenges surrounding the appointment of arbitrators, even with recent amendments in the law. She pointed out that while obtaining an award is a significant step, enforcement poses its own set of challenges. The three critical requirements for arbitrators are expertise, impartiality, and effective time management.
She echoed Justice Rao’s observation that many view arbitration as a secondary profession. For progress to occur, arbitrators must treat it as a primary profession. The shift towards institutional arbitration has happened because these processes are often more streamlined, adhering to rules and timelines more effectively than arbitrators appointed directly by parties.
Priyanka stressed that the purpose of arbitration is to serve as an alternative dispute resolution mechanism, not to replicate the lengthy litigation experience. She questioned whether the current system is achieving this goal, urging a thorough reassessment of how the arbitration profession is approached.
Additionally, she highlighted that both arbitrators and parties share the responsibility for timely resolutions. The tendency for extensive questioning during cross-examinations often prolongs the process unnecessarily. As parties appoint counsel and engage in arbitration, they need to clarify whether they are seeking genuine resolution or merely extending the dispute. This is increasingly relevant as many organizations reconsider arbitration due to its cost implications.
Shujath Bin Ali shared his insights on the current landscape of arbitration, particularly emphasizing the necessity of institutional arbitration clauses in contracts across various jurisdictions, such as DIAC and MCIA. He highlighted the challenges faced by his organization, which manages numerous power and waste management projects, particularly those bound by legacy contracts predating 2019.
He discussed specific difficulties in appointing arbitrators, with some cases remaining unresolved for over two years, illustrating how procedural issues can significantly delay access to funds that are already held in court. Shujath recounted instances where government entities have leveraged legal tactics to stall payments, such as appealing to the Supreme Court, which exacerbates financial strain.
As a General Counsel, he faces pressure to present quarterly updates to the board, with a strong focus on cash realization from ongoing disputes. This pressure has led to a divided perspective among General Counsels regarding arbitration clauses; some express reluctance to include them due to concerns over timelines and costs.
Despite the challenges, Shujath acknowledged that there have been positive experiences in some jurisdictions where arbitration has functioned effectively. However, the disparities in experiences, particularly between private parties and government entities, underline the ongoing complexities within the arbitration framework.
Avimukt Dar, Founding Partner of IndusLaw, emphasized the evolution of arbitration since 1940, noting that the process was initially complex and often intimidating for young lawyers due to heavy court involvement. Many litigants still favor court participation for certainty and precedent, especially in arbitrations like GAFTA.
Mr. Mayank Mishra, Partner at IndusLaw, highlighted the significant issue of seemingly endless extensions under Section 29A, which governs the timeline for arbitration proceedings. He noted that, while some delays may be due to the parties themselves, there are instances where multiple extensions have been requested at the Tribunal’s insistence. To remedy this situation, he advocated for a legislative cap on arbitration durations, emphasizing that the current reality of proceedings stretching five to six years is untenable. Establishing a clear endpoint for the extension process is essential to maintain the efficiency of arbitrations and prevent them from dragging on indefinitely.
Session 2 on “Bridging the Gap: Domestic Arbitrations and International Arbitrations” was moderated by James Nicholson, Senior Managing Director at FTI Consulting. The session featured a distinguished panel of speakers, including Justice (Retd.) Sanjay Kishan Kaul, former Judge of the Supreme Court of India; Aditya Jalan, Partner at AZB & Partners; Binsy Susan, Partner at Shardul Amarchand & Mangaldas & Co; Ketan Gaur, Partner at Trilegal; and Gaurav Pachnanda, Senior Advocate at the Supreme Court of India. The discussion focused on exploring the differences and intersections between domestic and international arbitration, addressing challenges, best practices, and potential reforms needed to enhance the arbitration landscape in India.
Mr. James Nicholson initiated the discussion by posing a thought-provoking question to Justice Kaul: Parties often opt for “safe” choices when appointing arbitrators, favoring those they know or who have been frequently appointed. He asked how we can break this cycle to promote greater diversity among arbitrators, particularly for those who are underrepresented, ensuring they receive fair opportunities for appointment. Additionally, he inquired about potential lessons that domestic arbitration could learn from international practices in this regard.
Justice Kaul responded thoughtfully, emphasizing that the quality of arbitration is indeed closely tied to the tribunal’s composition. He acknowledged the importance of impartiality, independence, and relevant expertise in selecting arbitrators. Justice Kaul noted that while parties often prefer familiar names for their sense of security, this can limit diversity and innovation in the arbitration process.
He highlighted the significance of institutions and courts in fostering diversity by appointing arbitrators who bring different perspectives and backgrounds. Justice Kaul pointed out recent positive developments in India, where the Supreme Court has made strides in appointing a broader range of practitioners, including women, which reflects a growing commitment to inclusive practices.
Moreover, he stressed the necessity of engaging younger lawyers and less conventional choices in arbitration, arguing that many capable counsels have substantial experience in handling commercial disputes. By broadening the criteria for arbitrator selection and encouraging a diverse pool.
In closing, he encouraged continued dialogue and collaborative efforts among stakeholders to prioritize diversity in arbitrator appointments, drawing on both domestic and international best practices.
Continuing the discussion, James directed a question to Mr. Gaurav Pachnanda, focusing on the representation of women in arbitration. He noted that the community of arbitrators often appears quite male-dominated and asked what steps both the broader arbitration community and women within it can take to facilitate greater inclusion and support for female arbitrators.
Mr. Gaurav Pachnanda addressed the issue by highlighting two significant trends regarding women’s representation in arbitration. He noted a substantial gap between the number of women serving as arbitrators in international versus domestic arbitration. While it’s becoming increasingly common to find qualified female arbitrators in high-value international disputes, this trend is still emerging in domestic contexts. Moreover, the pace of progress in bridging this gap internationally is notably faster than in domestic arbitration.
He emphasized that these disparities may stem from both conscious efforts and inherent shortcomings within the arbitration ecosystem. To effectively address the gap, Gaurav suggested viewing the issue through two lenses: the current state of the legal profession and the existing biases within the domestic arbitration framework. He observed that while women are more present in various legal roles than in the past, there remains significant work to be done to overcome institutional biases and improve representation.
Gaurav proposed three key steps to promote greater inclusion:
- Acknowledgment
- Nurturing Talent
- Appointments
By implementing these strategies, Gaurav believes that the arbitration community can take meaningful steps toward bridging the gender gap and fostering a more inclusive environment.
Bincy Susan contributed to the discussion by addressing the importance of widening the pool of arbitrators. She acknowledged that, while there is a broader selection of arbitrators today compared to seven or eight years ago, there remains a critical need for concerted efforts to train arbitrators. She pointed out that, despite the presence of highly trained judges, many commercial lawyers in law firms and at the bar lack the necessary training for arbitration roles. This gap highlights a need to bridge the differences between international and domestic arbitration practices.
Bincy noted the successful initiatives by organizations like CIArb, which trains arbitrators globally, and mentioned Singapore’s establishment of the SIAC to develop a wide pool of trained arbitrators. She emphasized that, given the scale of arbitration in India, it would be beneficial to establish a legislative body dedicated to training arbitrators.
Regarding women’s representation, Bincy acknowledged existing biases but highlighted the positive trend of appointing women lawyers, including those from the Supreme Court, as arbitrators. She referenced the practices of the MCIA and NCAC, which implement a rotation system to ensure that at least every third arbitrator is a woman. She suggested that courts could adopt similar practices to promote balance in future appointments.
Bincy concluded by stressing that while institutions have a significant role to play in enhancing diversity, law firms and lawyers who appoint arbitrators also carry a substantial responsibility to drive these changes forward.
Ketan Gaur shared insights on the challenges faced in domestic arbitrations, particularly regarding the lengthy duration of final hearings. He noted that these hearings can extend over 14 to 15 days of oral advocacy, often requiring multiple slots of two to four days from arbitrators, which can be a time-consuming process. As a result, final hearings can take anywhere from six to twelve months to conclude, leading to significant delays.
He emphasized the potential benefits of shifting from oral to written advocacy, arguing that such a change could streamline the arbitration process. By limiting the time spent on oral presentations, parties could experience reduced costs associated with legal fees, arbitrators’ fees, lodging, travel, and transcription services. Ketan pointed out that many practitioners in the domestic market are increasingly in favor of this transition, as surveys indicate a strong preference for written advocacy over traditional final hearings.
Aditya Jalan interjected to highlight an important aspect of the arbitration process: the influence of clients on advocacy strategies. He noted that the challenges often stem not just from counsel but from clients themselves, who may prioritize exhaustive arguments over efficiency. Clients typically want their legal teams to present all available arguments to secure a favorable outcome, regardless of whether the advocacy is brief or lengthy.
Aditya emphasized the need for clients to develop trust in their lead counsel and the broader legal team. He suggested that clients should be open to the idea of letting go of certain arguments, understanding that this approach can enhance the overall effectiveness of the case. By fostering this trust, clients could facilitate a more streamlined process, allowing their counsel to focus on the most compelling points without the pressure to cover every possible argument.
Sushil Shankar offered a disclaimer before expressing his views on the discussion surrounding the differences between international and domestic arbitration, particularly regarding the representation of women as arbitrators. He stated that he has nothing against women and actually prefers working with them. However, he pointed out a significant oversight in the conversation: the role of parties in the arbitration process.
Sushil emphasized that party autonomy is a cornerstone of arbitration, meaning that the preferences of the parties play a crucial role in the selection of arbitrators. He raised the concern that if parties are more comfortable appointing men as arbitrators, it could hinder efforts to increase female representation in this field. He suggested that this preference could be a barrier to achieving a more diverse and equitable arbitration landscape, underscoring the need for broader discussions about the influence of parties’ choices on arbitrator appointments.
Session 2 concluded on a positive note, highlighting the valuable insights shared by the panelists regarding the need for greater diversity in arbitration, particularly concerning the representation of women. The discussions emphasized the importance of training, the role of institutions, and the influence of party autonomy in shaping the future of arbitration.
Session 3 delved into the theme “Transformative or Much Ado about Nothing? A Reflective Journey Post Amendments to the 1996 Act,” moderated by Saman Ahsan, Partner at Khaitan & Co. The panel includes esteemed speakers such as Justice (Retd) AK Patnaik, former Judge of the Supreme Court of India; Parag Tripathi, Senior Advocate; Hemant Kumar Singh, Group General Counsel at L&T; and Kapil Chaudhary, Executive VP and General Counsel at Info Edge India Ltd. This session aimed to explore the implications of the recent amendments to the 1996 Act, questioning whether they represent a meaningful transformation or are merely superficial adjustments.
Mr. Saman Ahsan began by asking Justice (Retd.) AK Patnaik, “What were your initial expectations regarding the early appointments in arbitration, and how have you seen the landscape change in the past decade or so in terms of arbitration?”
Justice Patnaik emphasized that writing well-crafted awards has been one of the most challenging yet vital aspects of his role, as high-quality awards have bolstered his reputation and led to more arbitration appointments. To date, he has conducted around 150 arbitrations.
Mr. Saman Ahsan questioned Mr. Hemant Kumar Singh, asking, “Does arbitration remain the preferred choice for dispute resolution in most of your matters? And how have you seen the perception of arbitration as a dispute resolution mechanism change over the years?”
Reflecting on his experience as an in-house counsel, Mr. Hemant Kumar Singh emphasized the importance of effectively managing arbitrations. He noted that the success of their arbitration efforts hinges on the merit of their claims and the selection of law firms and counsel. Being careful in choosing legal representatives is crucial, as he considers himself the custodian of L&T’s legal matters. Singh mentioned that he has taken aggressive actions when necessary, resulting in successful recoveries of awarded amounts.
He also highlighted the importance of selecting the right arbitrator and noted that while it is ultimately the arbitrator’s discretion to accept a case, a positive approach during proceedings can lead to successful outcomes. He concluded by noting that his experience as a Group General Counsel has been largely positive, especially when they recently recovered nearly 2,000 crores from a Supreme Court ruling against a state government.
Mr. Saman Ahsan questioned Mr. Kapil Chaudhary, asking what he thinks about the perception of arbitration processes in India and whether he believes that the view of arbitration has changed from being a slow-moving beast to a process that delivers the desired results.
Kapil Chaudhary highlighted that the reality for lawyers and practitioners is that they are consuming a service, much like the various service models in today’s world, such as software as a service. He described arbitration as a justice delivery mechanism, emphasizing that the ultimate goal is to achieve an award that reflects the value of the service provided by the arbitrator. He pointed out that as corporate consumers, there is a natural inclination to gravitate toward the most efficient arbitration processes, which leads to discussions about the merits of ad hoc versus institutional arbitration.
He underscored the importance of having high-quality arbitrators, noting that Indian-origin arbitrators are gaining recognition and performing exceptionally well in international settings. He also mentioned the growing interest among law students in arbitration, suggesting that a new generation is entering the field.
Chaudhary expressed optimism about India’s potential to become a leading arbitration hub, particularly given its status as one of the fastest-growing economies. He acknowledged that recent amendments to arbitration laws have made significant strides toward modernizing the process.
He concluded by emphasizing the need for quality and support from the government to cultivate a robust arbitration environment in India. With a strong pool of talented arbitrators and the right conditions, he believes India is close to realizing its potential as a global arbitration hub.
*Disclaimer: The transcripts have been provided by TERES.
