Skip to content

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

Meridian Securities Ltd, a stock broker, and its client Ravi Kulkarni signed a client-broker agreement containing a clause that all disputes will be referred to arbitration. A dispute arises over unauthorised trades. Under the definition of an arbitration agreement in the Act, which statement is correct?

The clause is a valid arbitration agreement. The Act allows it to be a clause within a contract, and it is in writing because it is contained in a document signed by both parties. It can cover disputes that may arise in future.

  1. AThe clause is valid only if it is a separate agreement and not part of the main contract
  2. BThe clause is a valid arbitration agreement because it is in writing in a document signed by the parties, and it may take the form of a clause in a contractCorrect
  3. CThe clause is invalid because arbitration agreements can cover only disputes that have already arisen
  4. DThe clause is valid only if it covers contractual disputes and not any other legal relationship

Explanation

An arbitration agreement may be an arbitration clause in a contract or a separate agreement, and must be in writing. A document signed by the parties satisfies the writing requirement. The Act covers disputes that have arisen or may arise, so option C is wrong, and the legal relationship may be contractual or not.

Did you get it right without looking?

One question tells you little. A timed set on Arbitration under Investors' Grievances Redressal Mechanism of Stock Exchanges shows your real accuracy, how long you take and where you lose marks.

Practise Arbitration under Investors' Grievances Redressal Mechanism of Stock ExchangesFree diagnostic mock

More Arbitration under Investors' Grievances Redressal Mechanism of Stock Exchanges questions