CS Professional · Arbitration, Mediation and Conciliation

Preparation and Execution of Arbitral Award: CS Professional Guide

This chapter covers how an arbitral tribunal makes a valid award and what follows. You study its form and contents under Section 31, reasons, settlement and additional awards, interest, costs, delivery, date and place, and the tribunal's lien on the award under Section 39. Solve questions by stating the provision, applying the facts, then concluding.

What this chapter covers

This chapter deals with the final product of arbitration: the award. Section 31 sets the core rules. The award must be in writing, signed, reasoned (with two exceptions), dated, and state the place of arbitration. A signed copy must go to each party. The tribunal may also make interim awards, add interest, and fix costs.

Around Section 31 sit related provisions. Section 30 allows a settlement to be recorded as an award on agreed terms. Section 33 allows correction, interpretation and additional awards. Section 31A gives the regime for costs. Section 29A sets the time limit for making the award. Section 39 gives the tribunal a lien on the award for unpaid costs, with a court remedy for the party who needs the award. Conciliation has its own deposit rule in Section 79.

The chapter links to the rest of the paper. Before it come the tribunal's constitution and the conduct of proceedings. After it come challenge to the award, enforcement and appeals. A defective award invites challenge, so you need to know what a valid award looks like. In the written paper, this chapter can be tested through fact-based problems.

This chapter is compact, rule-based and predictable, so it rewards careful reading. The provisions have exact conditions, such as who must sign, when reasons can be skipped, and which time limits apply, and examiners build fact patterns around them. Arbitration and Conciliation carries 70 marks in Paper 7.1, and the paper is open book, but you still lose marks if you cannot find and apply the right sub-section quickly. Strong command here also supports your answers on challenge and enforcement of awards.

Preparation and Execution of Arbitral Award: topics in the order to study them

1Form and Contents of Arbitral Award (Section 31)It is the base provision. Writing, signatures, reasons, date, place and delivery all come from here.
2Reasoned Award, Settlement Award and Additional AwardThese build on Section 31: the two exceptions to reasons, awards on agreed terms under Section 30, and additional awards under Section 33.
3Interest and Costs in an Arbitral AwardOnce you know the basic award, learn what money it can carry: interest under Section 31(7), and costs, which the tribunal fixes under Section 31(8) in accordance with Section 31A.
4Delivery, Date and Place of the AwardThis is a short, high-clarity area. It ties the seat of arbitration to where the award is deemed made and closes the procedural steps.
5Lien on Arbitral Award and Deposits as to Costs (Section 39)Study it last because it depends on costs and delivery. It covers the tribunal's lien and the court's power to order delivery on payment into Court. The lien under Section 39(1) is subject to Section 39(2) and to any contrary provision in the arbitration agreement.

How to prepare Preparation and Execution of Arbitral Award

Treat this chapter as a checklist of exact rules. Read the sections, then practise applying them to facts.

Read Section 31 line by line and list each requirement: writing, signatures, reasons, date, place, delivery.
Learn the conditions and exceptions: majority signatures are enough if the reason for an omitted signature is stated, and reasons may be omitted if parties agree or the award is on agreed terms.
Make a short note on Sections 30 and 33: settlement award, correction and interpretation within thirty days, and additional award requests.
Separate interest into two periods: before the award under Section 31(7)(a) and after the award under Section 31(7)(b), and note what the tribunal may do under each.
Study Section 31A as a flow: discretion on costs, the general rule that the unsuccessful party pays, and the factors the tribunal considers.
Study Section 39 with Section 79 so you can contrast the lien in arbitration with deposits in conciliation.
Solve past-style problems in three parts: provision, application to facts, conclusion. Mark the sections in your open-book material for quick reference.

Common mistakes in Preparation and Execution of Arbitral Award

Saying every award must contain reasons.
Fix: Always add the two exceptions: parties agreed that no reasons are to be given, or the award is on agreed terms under Section 30.
Requiring all arbitrators to sign in every case.
Fix: State that majority signatures are enough, so long as the reason for any omitted signature is stated.
Mixing up pre-award and post-award interest.
Fix: Write them separately: clause (a) covers the period from cause of action to award date; clause (b) covers award date to payment, at two per cent above the current rate unless the award directs otherwise.
Ignoring the conditions on costs agreements.
Fix: Remember that an agreement to bear costs in any event is valid only if made after the dispute arose, and that a different order needs recorded reasons.
Confusing the lien in Section 39 with deposits in Section 79.
Fix: Section 39 is arbitration: lien on the award and court relief. Section 79 is conciliation: deposits, suspension or termination after thirty days of non-payment, and return of unspent balance.
Naming the wrong place for the award or skipping date and place in drafted answers.
Fix: State that the award shows its date and the place of arbitration determined under Section 20, and is deemed made at that place.

Last-day revision: Preparation and Execution of Arbitral Award

An award must be in writing and signed by the members of the tribunal.
With more than one arbitrator, majority signatures suffice if the reason for any omitted signature is stated.
Reasons must be stated unless the parties agreed otherwise or the award is on agreed terms under Section 30.
The award must state its date and place of arbitration, and is deemed made at that place.
A signed copy of the award must be delivered to each party.
The tribunal may make an interim award on any matter on which it could make a final award.
Pre-award interest is at a reasonable rate, unless parties agree otherwise; post-award interest is two per cent higher than the current rate, unless the award directs otherwise.
Costs follow Section 31A: general rule is that the unsuccessful party pays, with a different order allowed for reasons recorded in writing.
An agreement to pay costs in any event is valid only if made after the dispute has arisen.
Under Section 33, a party may request correction of computation, clerical or typographical errors within thirty days of receiving the award, unless the parties agreed another period. The tribunal may also correct such errors on its own within thirty days of the award date.
Interpretation of a specific point under Section 33 is available only if the parties have so agreed. A request for an additional award on claims omitted from the award is available unless the parties agreed otherwise, and must be made within thirty days of receiving the award.
The tribunal has a lien on the award for unpaid costs, but this is subject to Section 39(2) and to any contrary provision in the arbitration agreement. A party can apply to Court for delivery on paying the demanded costs into Court.
An application under Section 39(2) cannot be made by a party if the fees were fixed by written agreement between that party and the tribunal.

Preparation and Execution of Arbitral Award practice questions

Preparation and Execution of Arbitral Award: frequently asked questions

Can an arbitral award be oral?

No. Section 31(1) requires the award to be made in writing and signed by the members of the tribunal. Where there is more than one arbitrator, majority signatures suffice if the reason for any omitted signature is stated.

When can a tribunal skip giving reasons?

Under Section 31(3), reasons are not needed if the parties have agreed that none are to be given, or if the award is an award on agreed terms under Section 30. In all other cases the award must state the reasons on which it is based.

What happens if the tribunal refuses to deliver the award until costs are paid?

Under Section 39(1), the tribunal has a lien on the award for unpaid costs, subject to Section 39(2) and any contrary provision in the arbitration agreement. If the tribunal refuses to deliver except on payment of the costs it demands, a party can apply to Court, which may order delivery on payment of the demanded costs into Court. The Court then decides what reasonable sum goes to the tribunal and refunds the balance.

Is the time limit for making an award part of this chapter?

It is closely related. For matters other than international commercial arbitration, Section 29A requires the award within twelve months from completion of pleadings under Section 23(4). The parties may extend this by consent for up to six months. After that, the arbitrators' mandate terminates unless the Court extends the period, which it may do only for sufficient cause. For international commercial arbitration, there is only an endeavour to decide within twelve months. Read it with the award provisions, as examiners may combine them in one fact pattern.