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CS Professional · Arbitration, Mediation and Conciliation · Arbitration under Investors' Grievances Redressal Mechanism of Stock Exchanges

A broker and a client exchange emails in which the client accepts the broker's terms, including a term to arbitrate all trading disputes. No physical document is signed. The broker later argues there is no written arbitration agreement. What is the correct position?

The agreement is in writing. The Act treats an exchange of communications, including through electronic means, that provides a record of the agreement as writing. The email exchange accepting the arbitration term therefore forms a valid written arbitration agreement even without a signed paper document.

  1. ANo written agreement exists, because only signed paper documents count
  2. BThe agreement is in writing, because an exchange of communications through electronic means that provides a record of the agreement qualifiesCorrect
  3. CThe agreement is in writing only if a notary attests the emails
  4. DThe agreement is in writing only if the stock exchange confirms the emails

Explanation

An arbitration agreement is in writing if contained in an exchange of letters, telex, telegrams or other means of telecommunication, including electronic communication, which provides a record of the agreement. The emails give such a record. Option A ignores this provision.

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