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

A investor and a broker exchanged emails in which the broker wrote, 'All disputes on your account will go to arbitration under exchange rules,' and the investor replied, 'Agreed.' Both emails are on record. Is there an arbitration agreement in writing under section 7?

Yes. Under section 7(4)(b), an agreement is in writing if it is contained in an exchange of communications through electronic means that provide a record of it. The emails record the broker's proposal and the investor's acceptance, so no signed document is needed.

  1. ANo, because only a document signed by both parties qualifies
  2. BNo, because email is not a recognised form of communication
  3. CYes, because an exchange of communications through electronic means that provides a record of the agreement is treated as writingCorrect
  4. DYes, but only if the emails were later printed and signed

Explanation

Section 7(4)(b) treats an exchange of letters, telex, telegrams or other means of telecommunication, including electronic means, that provide a record of the agreement as writing. The emails therefore qualify without any signature. Insisting on a signed document ignores clauses (b) and (c).

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