-Mr. HM Seervai, Preface to the 1st ed., Constitutional Law of India.
Friday, February 19, 2021
Saturday, January 16, 2021
A recent decision of the Supreme Court in Padia Timber v Vishakapatnam Port Trust is interesting on many counts. One, it is a rare decision by the Supreme Court construing general contract law (Sections 4 and 7 of the Indian Contract Act, 1872. Two, the Supreme Court overturned the decision of the trial court and the High Court notwithstanding that the case does not involve any new question of law that courts previously had not dealt with but that the lower courts (trial court and the High Court) did not deal with in this case. Three, the decision throws considerable light on government contracting practices and can act as a context in discussing such practices. Four, this case relates to a notice inviting tender that was floated more than thirty years back (1990)! The matter was heard in the SC several times between 2007 and 2011 but it appears that the matter was not heard between 2011 and 2018.
The judgment reiterates the position that acceptance should be unconditional as per Section 7 and various decided cases.
On facts, when the appellant, Padia Timbers, submitted its bid, it made a revised quotation stating that inspection would have to be conducted at Padia Timber's depot an not otherwise. This is where government tendering practices are to be noted. Given the requirement of a rigorous and complaint free tendering process, government contracts usually state that the bidder must "accept" all the conditions stated in its offer. If that is not the case, the Government entity generally rejects the bid if the non-acceptance pertains to a material provision. In this case, the error committed was that the Government entity went ahead with the tendering process and awarded the contract to the bidder despite deviation from the condition regarding inspection. What really happened making the port trust to proceed with the tendering process and awarding the contract is not clear and will be known if the tender file is perused.
The Court ultimately ordered the Port Trust to refund the earnest money to Padia Timber at an interest rate of 6% per annum from the date of institution of the suit (1994) till the date of refund.
Tuesday, December 29, 2020
Vidya Drolia v DTC: Part II: Interesting Aspects- Contradiction between Patel Engineering & Booz Allen
- Judicial review and court's jurisdiction u/ss 8 and 11 are identical but extremely limited [Para 96(b)]
- Patel Engineering is no more good law in view of the 2015 and 2019 amendments to the 1996 Act. [96(a)]
- By virtue of separability and competence principles, arbitral tribunal is the "preferred first authority" to decide all aspects of non-arbitrability and courts can have a second look in terms of Sections 34(2)(a)(i), (ii), or (iv) or 34(2)(b)(i) of the 1996 Act. [96(c)]
- But courts can exercise its jurisdiction where the subject-matter of the dispute is "manifestly and ex facie" non-arbitrable. [96(d)].
Tuesday, December 22, 2020
- the first opinion was of Lord Hamblen and Lord Leggatt with which Lord Kerr agreed,
- the second one by Lord Sales (with whom Lord Sales agreed), and
- also a separate opinion by Lord Sales.
- Where there is no express or implied choice of the law of the contract, whether the law with which the main contract is most closely connected should govern the arbitration agreement?
- Whether, on facts, parties chose Russian law to govern their construction contract?