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

Sunrise Equities and client Mohan Das exchanged emails. Sunrise's mail said 'All disputes on your account shall go to arbitration; please confirm.' Mohan replied 'Confirmed.' Later, in a suit by Mohan, Sunrise applies for reference to arbitration, and Mohan argues there is no signed document. Which is correct?

The email exchange satisfies the writing requirement because the Act recognises an exchange of communication through electronic means that records the agreement. The court should therefore refer the parties to arbitration unless it finds that prima facie no valid arbitration agreement exists.

  1. ANo arbitration agreement exists because only a signed document qualifies
  2. BThe agreement is in writing as an exchange of communication through electronic means providing a record of the agreement, so the court must refer unless prima facie no valid agreement existsCorrect
  3. CThe agreement is valid only if it is later converted into a signed document
  4. DThe agreement is valid only if the claim and defence statements both mention it

Explanation

An agreement is in writing if contained in an exchange of letters or other telecommunication, including electronic means, which provides a record. The emails do this. The court must then refer the parties unless it finds that prima facie no valid agreement exists. A signature is one route, not the only one.

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