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CS Professional · Arbitration, Mediation and Conciliation · International Law of Arbitration

Under a contract between Rao Steels Ltd (India) and Tanaka Corp (Japan), the arbitration agreement is silent on whether the tribunal may decide as amiable compositeur. The tribunal member suggests deciding by fairness rather than strict law. What is the position under Section 28?

The tribunal cannot decide as amiable compositeur. Section 28(2) permits deciding ex aequo et bono or as amiable compositeur only where the parties have expressly authorised it, and silence in the agreement is not such authorisation.

  1. APermitted, as international tribunals have inherent equitable power
  2. BPermitted if the tribunal considers it appropriate given the circumstances
  3. CPermitted only if the High Court approves
  4. DNot permitted unless the parties have expressly authorised itCorrect

Explanation

Section 28(2) allows decision ex aequo et bono or as amiable compositeur only if the parties have expressly authorised it. Silence is not authority. Under Section 28(3) the tribunal must also take into account the contract terms and trade usages in all cases.

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