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Kaikara Construction Company v. State of Kerala

Civil Appeal · Neutral citation not assigned (Civil Appeal arising out of SLP (Civil) Nos. 14947-14948 of 2011)Decided 1 Jul 2014
Civil Appeal arising out of SLP (Civil) Nos. 14947-14948 of 2011
Justice Sudhansu Jyoti Mukhopadhaya · Justice Dipak Misra

Background

A road contractor and the State disputed progress, withheld payments and extensions of time. The contract documents contained conflicting provisions about arbitration and appointment of a dispute-review expert. The High Court refused to appoint an arbitrator, but the parties later jointly proposed a retired High Court judge.

Decision Breakdown

The Court set aside the High Court order and referred the dispute to retired Justice K. John Mathew on the parties' mutual agreement. It expressly avoided deciding the competing arguments about the original contract's arbitration provisions. The parties were to negotiate and settle the terms of arbitration, with early completion expected. The contractor's payment claim and responsibility for delay remained to be resolved in that process.

Lesson Learnt

Parties may agree on arbitration to resolve a contract dispute even while contesting the original dispute-resolution terms. An order appointing an arbitrator does not establish that the contractor's claim is payable.

Official source (sci.gov.in)View Judgment (PDF)

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