SC defines scope of judicial interference.

ISLAMABAD -- The Supreme Court has defined the scope of judicial interference in the award of an arbitrator, describing it as a final determination of a dispute between the parties involved.

'An arbitration award is a final determination of the dispute between the parties. The grounds for challenging an award are very limited,' read a six-page judgment authored by Justice Syed Mansoor Ali Shah while dismissing the National Highway Authority's (NHA) petition against the award of Rs65,40,22 in favour of a construction company by an arbitrator in 2010.

'There are three broad areas on which an arbitration award is likely to be challenged i.e. first, jurisdictional grounds (non-existence of a valid and binding arbitration agreement); secondly, procedural grounds (failure to observe principles of natural justice) and thirdly, substantive grounds (the arbitrator making a mistake of law). The review of an arbitration award cannot constitute a re-assessment or reappraisal of the evidence by the court. An over-intrusive approach by courts in examination of the arbitral awards must be avoided,' it further stated.

A division bench of the apex court led by Justice Shah noted that the court was not supposed to sit as a court of appeal and must confine itself to the patent illegalities in the award, if any.

'The jurisdiction of the court under the Act (Arbitration Act, 1940) is supervisory in nature. Where two findings are possible, the court cannot interfere with the award by adopting its own interpretation. Interference is only possible if there exists any breach of duty or any irregularity of action which is not consistent with [the] general principles of equity and good conscience,' Justice Shah observed.

'The arbitrator alone is the judge of the quality as well as the quantity of the evidence. He is the final arbiter of dispute between the parties. He acts in a quasi-judicial manner and his decision is entitled to utmost respect and weight,' he added in the verdict.

'By applying the afore-noted principles of law on the subject and considering the petitioner's objections within the limited scope of [a] court's jurisdiction in testing the validity of [an] award, this court is not supposed to sit as a court of appeal and make a roving inquiry and look for latent errors of law and facts in the award,' the judgment read.

Justice Shah noted in his verdict that the arbitration is a forum of the parties' own choice in making their decision and should not be...

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