Logistics of arbitration need to be cut down: SC judge
KOLKATA: Alternative dispute-resolution mechanisms, like arbitration, need to be migrated online to cut down cost of logistics and a robust mechanism needs to evolve which requires in-person hearing by courts were some measures suggested by Supreme Court judge Justice Indu Malhotra while speaking at a webinar organised by CII and AQUILAW on May 9 on legal compliance and business continuity during Covid-19.
Justice Malhotra said the cost involved in some arbitration proceedings is huge and needs to be cut to be made more effective. She also said court proceedings cannot be put on hold indefinitely.
Constitutional law expert and MP A M Singhvi argued that invoking the ‘force majeure' clause to insulate parties from contractual obligations and paying penalties for failing to meet contract deadlines may have a higher legal threshold in India than in many countries. He said legal jurisprudence in India on this issue, which has evolved in four Supreme Court judgments from 1954 to 2017, has highlighted the “temporariness” of this clause. Business disruptions due to Covid-19 have led to apprehensions that many companies in India will invoke ‘force majeure' clauses in their contracts to insulate themselves from litigation for failing to meet obligations due to the
lockdown. Industrialist Harsh Neotia, in his opening remarks, highlighted how certain labourintensive sectors had come to a grinding halt. AQUILAW partner Sucharita Basu, while moderating the discussion, stressed the need to understand how other countries are dealing with these legal posers.
Justice Malhotra, while highlighting the steps taken by the Supreme Court in easing the
legalities to enable online migration of hearings, mentioned that the court had sought responses from all stakeholders on a PIL by a home-buyer requesting that the interest component be included in the three-month
loan repayment moratorium guidelines issued by RBI. She also stressed better, shorter and effective pleadings online as against over-speaking during
legal arguments, which may add to confusion in the online domain.