1952 (10) TMI 42 - SC - Indian Laws

Arbitrator Misconduct: Fairness in Proceedings Emphasized

Payyavula Vengamma Versus Payyavula Kesanna And Others

Payyavula Vengamma Versus Payyavula Kesanna And Others - 1953 AIR 21, 1953 (0) SCR 119 Issues:Challenge to arbitration award on grounds of legal misconduct.Analysis:The plaintiff filed a suit for maintenance and other claims, which was referred to arbitration. The arbitrator examined each party separately, leading to allegations of legal misconduct. The plaintiff argued that the arbitrator's actions were unjust as she was not given an opportunity to respond to statements made by the defendant during arbitration. The defendant contended that the arbitrator's actions were within the scope of the reference to arbitration and did not constitute legal misconduct. The arbitrator's award included consideration of statements made by the defendant in the absence of the plaintiff, which was deemed a violation of natural justice principles.The Court found that the arbitrator's conduct, although well-intentioned, was not in line with established legal principles. Citing precedents, the Court emphasized the importance of fairness and equal opportunity for both parties in arbitration proceedings. The Court held that the arbitrator's actions amounted to legal misconduct, which tainted the validity of the award. The defendant's argument of no prejudice caused to the plaintiff due to the arbitrator's actions was dismissed, as the fundamental principles of justice were deemed to have been compromised.The Court rejected the contention of waiver of rights by the plaintiff, as it was not pleaded by the defendant and could not be raised at that stage. Consequently, the High Court's judgment upholding the arbitration award was set aside, and the trial court's decision to set aside the award was restored. The appeal was allowed, with costs awarded to the appellant.