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First Miscellaneous Appeal‑No. 12/4 of 1951, decided on 26th February, 1952, under section 39 (1) (vi) of Arbitration Act X of 1940, against the order of Senior Judge, Kohat, dated 7th December, 1950.
First Schedule, para. 2 -Even number‑ of arbitrators‑Award unanimous‑Failure to appoint umpire‑Not enough for setting aside award.
The emphasis in para. 2, First Schedule of Arbitration Act is not on the appointment‑of‑ the umpire but on his appoint ment within one month of the appointment of the arbitrators.
In the case of an even number of arbitrators who have given a unanimous award; the. award cannot be set aside for the mere reason that the arbitrators failed to appoint an umpire.
Ss. 14, 30‑Failure to give notice will not invalidate award‑Notice by one arbitrator enough.
Failure by the arbitrators to give a notice under section 14 of the Act is not an omission which would invalidate the award.
The mission is not covered by words " otherwise invalid " in section 30, clause (c).
It is not the intention of the law that notice in order to be valid should be given by all the arbitrators. If a notice is given by one arbitrator only, it shall be deemed to have been giver by all, unless the contrary is proved and it will thus be a perfectly good notice.
Gul Muhammad Khan, for Appellant.
Abdul Latif Khan, for Respondent.
‑A contract for the construction of a dam in Tulanji village, was given to Badshah Gal, son of Noorzada, by the Public Works Department of the North -West Frontier Province. On the 25th of December 1948, Badshah Gal sublet this contract to Labab Gul, son of Hamid Gul. The latter executed a deed by which he undertook to carry out the work to the satisfaction of the responsible authorities, and pay the income‑tax as well as all other ex penses necessary for the completion of the work. Subsequently it appears that the two fell out over the accounts. On the 30th of April or the 1st of May 1950, a document was executed by both these persons, appointing Isam Gul, a Pleader of Kohat, Malik Behram Shah, Haji Nur Muhammad Khan and Hamesh Gul Khan as arbitrators to settle all the disputes between them. The persons mentioned above, after recording certain evi dence, which has also been placed upon the record, gave an award, holding Labab Gal responsible to pay Rs. 9,910 to Badshah Gul. The latter made an application under section 14 (2) of the Arbitration Act of 1940, to the Court of the Senior Sub‑Judge Kohat, asking it to pronounce its judgment accord ing to the above award. .
Labab Gul contested this application and raised several objections to it.
The learned Senior Sub‑Judge, after overruling all the objections has pronounced the judgment in accordance with the award, and has granted Badshah Gul a decree for Rs. 9,910. Labab Gul has come up on appeal against this order.
There are only three grounds, which have been advanced before me against accepting the award, and pronouncing the judgment thereupon. The first is that an even number of arbit rators having been appointed, no umpire was appointed by the arbitrators as laid down in para. 2 of the First Schedule attached to the Arbitration Act.
Section 3 of the Act runs as under :‑
"In arbitration agreement, unless a different intention is expressed therein, shall be deemed to include the provisions set out in the First Schedule in so far as they are applicable in the reference."
The learned counsel for the appellant has argued that it is laid down in para.2 of the First Schedule, that if the reference is to an even number of arbitrators, the arbitrators shall appoint an umpire not later than one month from the latest date of their respective appointments, and since it was not done in this case, the whole award is bad in law.
The learned counsel seems to have misread para. 2 of the First Schedule. The emphasis in that para. is not on the ap pointment of the umpire, but on his appointment within one month of the appointment of the arbitrators. Apart from that, in the case before me the four arbitrators gave their award on the same or the next day of their appointment as arbitrators. It was a unanimous award. In a case where the even number of arbitrators have differed from each other there is the necessity for the appointment of an umpire, and the omission to do that might very well have some adverse effect, but when there is no disagreement between the arbitrators, it can hardly be said that on account of their failure to appoint the umpire, for which there was absolutely no necessity, the award was in any way adversely affected. I am consequently of the opinion that the award cannot be set aside for the mere reason that the arbitrators failed to appoint an umpire.
The second objection taken is that the arbitrators failed to give a notice as is provided by section 14 of the Act. The relevant portion of this section runs as under :‑
"When the arbitrators or umpire have made their award, they shall sign it and shall give notice in writing to the parties of the making and signing thereof and the amount of fees and charges payable in respect of the arbitration and award".
Mr. Isam Gul, one of the arbitrators, did give a notice as provided by this section to Labab Gul, and the latter in his evidence has not only admitted the receipt of this notice, but has actually produced it in Court. The contention of the learned counsel for the appellant is that it is not on behalf of all the arbitrators and it is, therefore, not a notice as contem plated by section 14 quoted above.
I do not think the failure by the arbitrators to give a notice under section 14 of the Act is such an omission which would invalidate the award. It should be noticed that an award cannot be set aside except on one or more of the grounds given in section 30 of the Act. They are, (a) that an arbitrator or umpire has mis-conducted himself or the proceedings, (b) that an award has been made after the issue of an order by the Court superseding the arbitration or after arbitration proceed ings have become invalid under section 35, and (c) that an award has been improperly procured or is otherwise invalid. The omission to give notice cannot be covered by (a) or (b), and this is even conceded by the learned counsel for the appel lant. He, however, wishes to bring it under "otherwise invalid" mentioned in (c). By no stretch of imagination can it be said that the omission to give the notice can invalidate the award, and I consequently hold that it is not covered by "otherwise invalid" too. In any case, I do not think that it is the intention of the law that notice in order to be valid should be given by all the arbitrators. If a notice is given by one, arbitrator only, it shall be deemed to have been given by all, unless the contrary is proved, and it will thus be a perfectly good notice.
The third objection taken up by the learned counsel for the appellant was that the appellant had not in fact appointed the four persons mentioned above as arbitrators. He had only asked them to bring about a compromise between him and Badshah Gul. This statement of Labab Gul has been contra dicted not only by Badshah Gul and his witnesses, but also by the arbitrators, who have appeared in the witness‑box, and have stated that they were asked to arbitrate. They all seem to be respectable and disinterested persons. In any case, Lahbab, Gul cannot be permitted to lead oral evidence for the purpose of contradicting the above agreement, which clearly shows that Isam Gul and others were in fact appointed the arbitrators.
The learned counsel for the appellant then by referring to certain items in the award criticized them by saying that them was no evidence produced before the arbitrators to allow those items to Badshah Gul, and that the arbitrators by doing so have been guilty of misconduct as understood by section 30 of the Act.
The arbitrators are the gentlemen who were selected by the parties to settle the dispute between them, and they con sequently were the judges of their own choice. They, after hearing the parties, arrived at a certain conclusion, which cannot be lightly upset. On the record there is nothing to show that by giving those items to Badshah Gul, the arbitra tors had either acted dishonestly or had in any other wav misconducted themselves. On the other hand, there is material on the record to indicate that award of the arbitrators was equitable and substantially just.
On the whole I think the appellant has failed to show any ground on which the award can be set aside,
The appeal fails and is hereby dismissed with cost. Pleaders fee Rs. 50.
A. H.
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