Arbitrator ex parte procedure, valid appointment, and sufficient notice upheld where no prejudice or proved bias was shown.

An arbitrator may proceed ex parte after repeated notices and a reasonable opportunity to participate, and the award is not vitiated merely because no separate prior warning of ex parte treatment was given where no prejudice is shown. The appointment of an outside arbitrator is valid where the arbitration clause does not exclude the court's power to fill a vacancy, so the reference is not a nullity. Allegations of bias and insufficient notice fail where notice is served on a responsible officer with actual knowledge of the proceedings and no disqualifying bias is proved. The award was sustained and objections on notice, jurisdiction, and bias were rejected.

---

---

Issues: (i) whether the arbitrator committed legal misconduct by proceeding ex parte without giving a specific prior notice of his intention to do so and thereby vitiated the award; (ii) whether the appointment of an outsider as arbitrator and the resulting reference were without jurisdiction or void under the arbitration clause and the Arbitration Act, 1940; (iii) whether the award was liable to be set aside on the ground of alleged bias or insufficiency of notice.

Issue (i): whether the arbitrator committed legal misconduct by proceeding ex parte without giving a specific prior notice of his intention to do so and thereby vitiated the award.

Analysis: Repeated notices were issued to the respondent, which did not participate despite knowledge of the proceedings. The Court held that where reasonable opportunity is afforded and the party remains recalcitrant, the arbitrator may proceed ex parte. A separate warning that the matter would be taken up ex parte is a matter of prudence, not an inflexible legal requirement. Since the respondent suffered no prejudice, the omission did not amount to legal misconduct.

Conclusion: The objection based on ex parte procedure fails and the award is not vitiated on that ground.

Issue (ii): whether the appointment of an outsider as arbitrator and the resulting reference were without jurisdiction or void under the arbitration clause and the Arbitration Act, 1940.

Analysis: The arbitration clause contemplated named officers, but also stated that if they were unavailable or unwilling the clause would be treated as non-existent. In the circumstances, the earlier challenge to the appointment had already been negatived, and the Court found no indication that the parties intended to exclude the court's power to fill the vacancy. The Court further held that the appointment was within jurisdiction and the reference was not a nullity.

Conclusion: The appointment of the arbitrator and the reference were valid and within jurisdiction.

Issue (iii): whether the award was liable to be set aside on the ground of alleged bias or insufficiency of notice.

Analysis: Notice served on the Divisional Manager, who had signed the agreement and had actual knowledge of the proceedings, was treated as sufficient notice to the corporation. No definite bias was established against the arbitrator, and the allegation that he was the appellant's lawyer was not proved so as to disqualify him. The Court therefore upheld the findings that notice was adequate and bias was not made out.

Conclusion: The grounds of bias and insufficiency of notice are rejected.

Final Conclusion: The award was sustained and made a rule of the Court, with the objections to notice, jurisdiction, and bias having failed.

Ratio Decidendi: An arbitrator may proceed ex parte after due notice and adequate opportunity, and an award will not be set aside for want of a special prior warning or for alleged misconduct unless actual prejudice is shown; where the arbitration clause does not exclude it, the court may validly appoint an arbitrator to fill the vacancy.

---