Civil Contractor A entered into an agreement with Architecture Firm B to design a building. Further, all matters in relation to the design of a mall in the same building were sub- contracted to another Architecture Firm C. The contract had a clause titled "Arbitration", under which the Chief Architect of a third Architecture Firm D had the power to remove any difficulties, including with regard to modification of any plans for the mall's design. The parties sought to get an interim order under section 9 of the Arbitration and Conciliation Act, 1996. Will the parties succeed ?

All India Bar Examination (AIBE) 2-II Previous Year Question Papers with Answers

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Civil Contractor A entered into an agreement with Architecture Firm B to design a building. Further, all matters in relation to the design of a mall in the same building were sub- contracted to another Architecture Firm C. The contract had a clause titled "Arbitration", under which the Chief Architect of a third Architecture Firm D had the power to remove any difficulties, including with regard to modification of any plans for the mall's design. The parties sought to get an interim order under section 9 of the Arbitration and Conciliation Act, 1996. Will the parties succeed ?

Principle: Expert determination is the referral of dispute to a an independent third party, who uses its expertise to resolve a dispute. An arbitration agreement must contemplate the existence of a "formulated dispute" as against an intention to avoid future disputes.

A: This is not an arbitration clause, but an expert determination clause, and hence the provisions of the Arbitration and Conciliation Act, 1996 would not apply

B: An interim order under section 9 would be possible depending upon the circumstances.

C: An interim order will not be possible till the formulation of the decision by the Chief Architect of Architecture Firm

D: The clause is unenforceable since only an Arbitral Tribunal can determine such a matter and the court will order the setting up of an arbitral tribunal first.

E: An interim order would be possible but only if consented to by both the parties.

The answer is: A

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Explanation

A: This is not an arbitration clause, but an expert determination clause, and hence the provisions of the Arbitration and Conciliation Act, 1996 would not apply.

Explanation:

Based on the provided principle and the description of the clause in question, it appears that the clause titled "Arbitration" is not actually an arbitration clause but rather an expert determination clause. In an expert determination clause, the parties agree to refer a dispute to an independent third party with expertise in the relevant subject matter to make a determination. This is different from arbitration, where disputes are resolved through a formal arbitration process.

Since the clause does not contemplate arbitration and instead involves expert determination by the Chief Architect of Architecture Firm D, the provisions of the Arbitration and Conciliation Act, 1996, would not apply. Therefore, the parties would not succeed in seeking an interim order under section 9 of the Act in this case.

Options B, C, D, and E are not applicable because they assume that the clause is an arbitration clause, which is not the case based on the provided information.