Module 3 Assessment Quiz | CAM

Q1 Part 1: Making Awards

Under Section 31 of the Arbitration Act, an arbitral award must be:

A.Made orally and later reduced to writing if requested B.Made in writing and signed by the members of the tribunal C.Registered with the court within 30 days of pronouncement D.Delivered through the arbitration institution only

Explanation

Section 31(1) mandates that an arbitral award shall be made in writing and shall be signed by the members of the arbitral tribunal. In tribunal proceedings with three arbitrators, signatures of the majority are sufficient, provided the reason for any omitted signature is stated.

Q2 Part 1: Making Awards

Which of the following is a mandatory requirement for a valid arbitral award under Section 31?

A.Filing in court within 15 days B.Presence of both parties at pronouncement C.Statement of reasons upon which the award is based D.Notarization by a public notary

Explanation

Section 31(3) requires the award to state the reasons upon which it is based, unless parties have agreed that no reasons are to be given, or it is a consent award under Section 30. A reasoned award is essential for meaningful judicial review under Section 34.

Q3 Part 2: Types of Awards

A "partial award" in arbitration refers to:

A.An award that finally disposes of one or more claims while leaving others for later determination B.A provisional order that may be modified by the final award C.An award where the tribunal could not reach unanimity D.An award that is subject to court approval before becoming effective

Explanation

A partial award finally disposes of certain claims, issues, or counterclaims while the arbitration continues for remaining matters. Unlike interim measures, partial awards are final and binding on the issues they address and can be enforced independently.

Q4 Part 2: Types of Awards

A consent award under Section 30 of the Arbitration Act:

A.Has lesser enforceability than a regular arbitral award B.Cannot include terms agreed by parties during mediation C.Must contain detailed reasoning for each agreed term D.Has the same status and effect as any other award on the merits

Explanation

Section 30(2) explicitly provides that a consent award shall have the same status and effect as any other award on the merits of the case. It records the settlement agreement and is fully enforceable. Unlike regular awards, consent awards need not contain reasons since they reflect party agreement.

Q5 Part 3: Section 34

Under Section 34, the maximum period within which an application to set aside an award must be filed is:

A.30 days from receipt of award, extendable up to 60 days B.3 months from receipt of award, with a maximum 30-day extension C.6 months from date of award without any extension D.1 year from receipt of award under general limitation law

Explanation

Section 34(3) prescribes a strict limitation: 3 months from receipt of award, with an additional 30 days only if the court is satisfied that the applicant was prevented by sufficient cause. This is an absolute bar - courts have no power to condone delay beyond 3 months + 30 days.

Q6 Part 3: Section 34

Scenario

An arbitral tribunal renders an award interpreting a contract clause differently from how the respondent understands it. The respondent believes this interpretation is legally incorrect.

Can the award be set aside under Section 34 on this ground?

A.Yes, erroneous interpretation of contract is a ground under Section 34 B.Yes, if the interpretation violates fundamental policy of Indian law C.No, mere errors of law or incorrect interpretation are not grounds for setting aside D.No, unless the interpretation results in a quantum exceeding 50% of the claim

Explanation

Section 34 does not permit review on merits. Post-2015 Amendment, Explanation 2 clarifies that the public policy test shall NOT entail a review on the merits. Erroneous application of law or incorrect interpretation of contract does not qualify as "patent illegality" or violation of fundamental policy.

Q7 Part 4: Domestic Enforcement

Under Section 36, after the time for filing a Section 34 application has expired, a domestic arbitral award:

A.Shall be enforced as if it were a decree of the court B.Requires a fresh suit for enforcement C.Must be registered with the arbitration council D.Becomes time-barred and unenforceable

Explanation

Section 36 provides that once the time for Section 34 has expired (and no application is pending), the award shall be enforced as if it were a decree of the court. This gives arbitral awards the same enforceability as court judgments, using the Code of Civil Procedure execution framework.

Q8 Part 4: Domestic Enforcement

After the 2015 Amendment, filing a Section 34 application:

A.Automatically stays the enforcement of the award indefinitely B.Automatically stays enforcement for 6 months C.Mandates the award-holder to wait until final disposal of Section 34 D.Does not automatically stay enforcement; stay requires separate application and court order

Explanation

The 2015 Amendment introduced Sections 34(5) and 36(2)-(3), clarifying that mere filing of Section 34 does not automatically stay enforcement. The party challenging the award must make a separate application for stay, and the court has discretion to grant stay subject to conditions (such as deposit).

Q9 Part 5: Foreign Awards

Under the New York Convention as implemented in India, which of the following is true?

A.India enforces awards from all countries regardless of Convention membership B.India applies reciprocity and commercial reservations C.Foreign awards can only be enforced against Indian nationals D.The Convention only applies to awards exceeding USD 1 million

Explanation

India acceded to the New York Convention in 1960 with two reservations: (1) Reciprocity - only awards from notified Convention states are enforced; and (2) Commercial - only disputes considered commercial under Indian law qualify. Part II (Sections 44-52) implements these provisions.

Q10 Part 5: Foreign Awards

Scenario

A party seeks to resist enforcement of a foreign award in India, arguing that the arbitral tribunal made a significant error in applying English law (the governing law of the contract).

Can the Indian court refuse enforcement on this ground?

A.Yes, patent illegality applies to foreign awards under Section 48 B.Yes, if the error amounts to violation of Indian public policy C.No, patent illegality is not a ground for refusing enforcement of foreign awards D.No, but the court must refer the matter back to the foreign tribunal for correction

Explanation

A critical distinction exists between Sections 34 and 48. For foreign awards under Section 48, "patent illegality" is NOT a ground for refusing enforcement. The public policy exception is construed even more narrowly for foreign awards - limited to fraud/corruption, fundamental policy, and basic morality/justice. Errors of law cannot justify refusing a foreign award.

Module 3: Arbitral Awards & Enforcement

Instructions