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M/s. Shinhan Apex Corporation v. M/s. Euro Apex B.V.

Civil Appeal · Neutral citation not assigned (Civil Appeal Nos. 4359-4360 of 2016)Decided 22 Apr 2016
Civil Appeal Nos. 4359-4360 of 2016
Justice F.M. Ibrahim Kalifulla · Justice S.A. Bobde

Background

Under a licence agreement governed by Dutch arbitration rules, an Arbitral Tribunal passed a Partial Final Award (PFA) in December 2011 directing the appellant to transfer its rights in two Indian patents to the respondent within 30 days of the respondent's request. In execution proceedings, a Single Judge directed the appellant to execute a transfer deed, apparently on the basis that the appellant had not complied with the respondent's original January 2012 draft deed. The appellant appealed, arguing that the respondent itself had sent a revised draft deed in April 2012, which the appellant had duly signed and returned, and that the Single Judge had overlooked this correspondence.

Decision Breakdown

The Supreme Court examined the full correspondence trail between January 2012 and June 2013 and found that the respondent's own revised draft deed of 4 April 2012, not the original January 2012 draft, was the document the appellant was actually required to execute, and that the appellant had signed and returned it (first by fax on 9 April 2012, then the original on 12 April 2012), with the respondent's own lawyers confirming its execution. The Single Judge had completely missed this sequence of events and wrongly proceeded as if only the January 2012 draft mattered, resulting in a "patent illegality" in the order under appeal. The Supreme Court held the appellant had, in fact, duly complied with the PFA's direction, set aside the Single Judge's order, and allowed the appeals.

Lesson Learnt

In disputes over whether a party has complied with a contractual or arbitral direction, courts look at the complete, actual correspondence trail rather than the first communication alone: a party who sends a revised request and later receives a signed response matching that revised request cannot successfully claim non-compliance by pointing only to the earlier, superseded version.

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

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