Disputes And Arbitration

During the performance of the contract, disputes may arise between the employer, engineer and contractor for various reasons of default in performance, progress payment, rates, time, etc. Negotiated amicable settlement is the endurable, quick solution, which requires mutual trust, cooperation, give and take policy, flexibility instead of rigidity of one's view, and vision for future relations. Unresolved disputes can conveniently be resolved through arbitration, which bears the stamps of law of natural justice, than resolution in court. Again, arbitration cannot succeed unless there is cooperation between contractor, client and arbitrator(s). Many times, when the award received is not palatable to either of the contesting parties, the unhappy party tries to drag on further in court to set aside the award. This defeats the very purpose of the arbitration process. The court does not set aside the award on flimsy ground or sits again for the judgment but on specific grounds. The court may even ask the arbitrator to review his award if any item is omitted. The responsibility imposed on the arbitrator is conduct the proceedings with prudence and diligence and not arbitrarily or whimsically and discharge his responsibilities in a cordial manner. The reasons for setting aside the award has been set out in Arbitration Act, 1940, which has since been modified in Arbitration & Conciliation Act 1996. As per the new Act, the award itself is considered as a decree and it need not be filed in the court. It is final and binding on both parties unless disputed by either party. The tendency to challenge the award should vanish, instead the aim should be to reach a negotiated, agreed, amicable and early settlement. It is hoped that better awareness and acceptance of this method fructifies in future.