REMOVAL OF A BIASED ARBITRATOR
The foremost requirement for any arbitration proceeding is the presiding of an unbiased arbitrator. It is the unbiased and impartial arbitrator that drives the entire arbitration proceedings to its desired result. Given this, it is a common logical understanding that a biased arbitrator would render the entire arbitral proceedings infructuous. Hence, it becomes vital to ensure that the arbitrator acts impartial throughout the continuance of the arbitration proceedings.
When the Arbitration and Conciliation (Amendment) Act, 2015 was promulgated, it intended to bring forth safeguards that ensured fairness and impartiality in the conduct of the arbitrators in an arbitration proceeding; hence ruling out bias because the original act lacked the same. The procedure to remove a biased arbitrator is divided in two helms depending upon the status of the arbitration proceedings-
Firstly, Doubts relating to biasness at the initial stage - Section 12(1) of the act deals with the current stage. When a person is approached to be an arbitrator in any dispute, a positive duty is cast upon him to disclose in writing any circumstances likely to give rise to justifiable doubts as to his independence or impartiality. Herein, actual bias is not relevant. What is relevant is the test that whether a reasonable person who was not the party to the dispute would think it likely that such interest/relation would make the arbitrator biased. But, the parties can still choose to continue with the arbitrator after such disclosure is made to them.
In Satyendra Kumar v. Hind Constructions Ltd., the court clearly pointed out that every such disclosure that effects the mind of the parties must be made so that they can decide whether to appoint that particular individual as their arbitrator or not.
Secondly, Doubts developing after appointment - Section 12(2). The arbitrator is under a duty to disclose any such information to the parties mentioned in sub-section (1) which affects his biasness and has arisen after his appointment. She has to give the same in writing to the parties immediately without any delay.
But if the party/parties knew of such information before the appointment and still continued to appoint the respective arbitrator, they cannot be allowed to challenge the arbitrator on the ground of biasness until and unless some new information has come to their knowledge. The same has been explained in Novel Granites Ltd. v. Lakshmi General Finance Co. Ltd.
Reading of Section 12(3) of the Act jots down the situations in which the arbitrator may be challenged. Clause (a) of the said section reads as follows- “circumstances exist that give rise to justifiable doubts as to his independence or impartiality.”
Schedule V and VII are of great importance in ascertaining biasness. Wherein Schedule V guides as to grounds which give rise to justifiable doubts as to independence or impartiality of the arbitrators; Schedule VII provides for list of persons who fill in the category of bias.
The aspect of removal of biasness has been the heat of the arbitration law since the beginning. It is a big relief that for ascertaining removal of arbitrators on the ground of biasness, the Act as well as the judicial precedents is focusing towards the possibility of bias and not the actual bias.
REFERENCES-
1. The Arbitration and Conciliation Act, 1996
2. The Arbitration and Conciliation (Amendment) Act, 2015
3. Satyendra Kumar v. Hind Constructions Ltd., AIR 1952 Bom 227.
4. Novel Granites Ltd. v. Lakshmi General Finance Co. Ltd., (2003) 3 RAJ 110.