High Court of KeralaSingle JudgeArbitration petition allowed; arbitrators provi...

Jose Mani & Sunitha Aji v Panjos Gardens Apartment Owners Association and others

Case / Petition Number:AR.No.40 of 2019

Case Details & Bench

Court
High Court of Kerala
Hon'ble Judges
  • P.B.SURESH KUMAR
Judgment Date
2020-01-07
Court Decision / Holding
Arbitration petition allowed; three arbitrators provisionally appointed (Adv. Sreelal Warriar; Adv. Bindu Sreekumar; Adv. P.S. Sunil). Registry directed to obtain disclosure statements under Section 11(8) and place the matter before the court for confirmation of the appointment of arbitrators.
Final Disposition
Arbitration petition allowed; arbitrators provisionally appointed; disclosure under Section 11(8) to be obtained and matter to be placed for confirmation of appointment.

Parties to the Case

Appellants / Petitioners

  • Jose Mani
  • Sunitha Aji

Respondents

  • Panjo Gardens Apartment Owners Association
  • Sebastian George
  • Jain Job alias Paul
  • Dr. Biji Elizabeth Kuriakose
  • Mukundan
  • Girish Nambiar
  • Santhosh Kumar
  • Sreejith V

Legal Representation & Advocates

Counsels for Petitioners

  • • Sri. Johnson Gomez
  • • Sri. C. Unnikrishnan
  • • Sri. S. Biju
  • • Sri. Sanjay Johnson

Counsels for Respondents

  • • Sri. P. U. Shailajan
  • • Sri. Vidya KuriaKose

Case Synopsis & Summary

Jose Mani and Sunitha Aji, owners in Panjos Gardens, allege that the Panjos Gardens Apartment Owners Association engaged in illegal and unauthorized conduct causing losses of Rs. 55,26,560. They challenge the AGM held on 02.03.2019 for electing a new Managing Committee, contending it was not properly convened and that several office bearers elected were disqualified from contesting. The petition asserts that the disputes with the Association fall within the Bye-laws, which provide for arbitration of internal disputes, and seeks appointment of arbitrators under Section 11 of the Arbitration and Conciliation Act, 1996 to resolve the disputes in Annexures A2 and A3. A counter affidavit by the seventh respondent (Vice-President of the Association) contends that the petitioners are not members of the Association and that the disputes were the subject of OS No.219 of 2012 before the Munsiff Court, rendering the arbitration petition not maintainable. Annexure A1 Clause 26 provides that disputes concerning the constitution and business of the Association, among members and officers or the Association and its officers, shall be referred to three arbitrators with the majority decision binding. The court cites sub-section 6-A of Section 11 and the Supreme Court’s decision in Duro Felguera S.A v. Gangavaram Port Ltd. to emphasize that the court’s role is limited to determining the existence of an arbitration agreement. Accordingly, the arbitration request is allowed, with provisional appointment of three arbitrators and directions for disclosure under Section 11(8) for eventual confirmation.

Provisions of Law Cited

Arbitration and Conciliation Act, 1996, Section 11(6-A)Arbitration and Conciliation Act, 1996, Section 11(8)Arbitration and Conciliation Act, 1996, Section 11

Legal Doctrines & Maxims

  • Minimize judicial intervention at the appointment stage of arbitration (as per Duro Felguera S.A v. Gangavaram Port Ltd.)
  • Existence of arbitration agreement as the sole relevant issue for appointment under Section 11(6-A)

Submissions & Arguments

Contentions of Appellants / Petitioners

The petitioners contend that the Panjos Gardens Association disputes are within its Bye-laws and require arbitration per Clause 26. They assert losses due to purported illegal conduct by the Association and argue the AGM was improperly convened, disqualifying some office bearers. Since a valid arbitration clause exists, the court should appoint arbitrators under Section 11(6-A). They rely on Duro Felguera S.A. v. Gangavaram Port Ltd. to limit court interference and to permit appointment of arbitrators, with disclosure under Section 11(8) and eventual judicial confirmation.

Contentions of Respondents

The respondents contend that the petitioners are not members of the Association and that the disputes were the subject of OS No. 219 of 2012 before the Munsiff Court, making arbitration not maintainable. They argue that petitioners lack standing to invoke arbitration and that the matter should be resolved by the civil suit route rather than arbitration under the Bye-laws. They maintain the court should not compel arbitration where membership status is disputed or where the issues are already adjudicated in existing proceedings.

Cited Precedents (1)

Case NameCitationTreatmentExplanation
Duro Felguera S.A v. Gangavaram Port Ltd.(2017) 9 SCC 729PositiveThe court relies on this precedent to hold that under Section 11(6-A), the court’s role is limited to verifying the existence of an arbitration agreement; once established, arbitration can proceed without merits adjudication by the court.

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Extracted Judgment Text

Exact text extracted from official judgment records.

## **IN THE HIGH COURT OF KERALA AT ERNAKULAM** # **PRESENT** **THE HONOURABLE MR. JUSTICE P.B.SURESH KUMAR** **TUESDAY, THE 07TH DAY OF JANUARY 2020 / 17TH POUSHA, 1941** **AR.No.40 OF 2019** ## **PETITIONERS:** **1 JOSE MANI, AGED 67 YEARS, SON OF LATE K I MANI, CONTRACTOR, KOTTOOR HOUSE, PADIVATTOM, EDAPPALLY P.O, KOCHI-682024, EDAPPALLY VILLAGE, KANAYANNUR TALUK, ERNAKULAM DISTRICT, NOW RESIDING AT 2284, 14TH A MAIN, HAL SECOND STAGE, INDIRA NAGAR, BANGALORE PIN 560008.** - **2 SUNITHA AJI,** **PANJOS GARDEN, PAVOOR ROAD, PADIVATTOM, KOCHI 682 024 (PRESENTLY AT THE LAWRENCE SCHOOL, LOVEDALE, OOTTAKKUNMAND, TAMIL NADU 643 003)** **BY ADVS. SRI.JOHNSON GOMEZ SRI.C.UNNIKRISHNAN (KOLLAM) SRI.S.BIJU (KIZHAKKANELA) SRI.SANJAY JOHNSON** ## **RESPONDENTS:** - **1 PANJOS GARDENS APARTMENT OWNERS ASSOCIATION AN ASSOCIATION REGISTERED UNDER THE TRAVANCORE COCHIN LITERARY SCIENTIFIC AND CHARITABLE SOCIETIES ACT, HAVING ITS REGISTERED OFFICE AT PANJOS GARDENS, PADIVATTOM, KOCHI-682024, REPRESENTED BY THE PRESIDENT SEBASTIAN GEORGE, S/O K T SEBASTIAN, ENGINEER, AGED 70 YEARS, RESIDING AT PANJOS GARDENS, FLAT NO 17A, PADIVATTOM, EDAPPALLY P.O, KOCHI-682024.** 2 A.R.No.40 of 2019 - **2 SEBASTIAN GEORGE,** - **S/O K.T. SEBASTIAN, ENGINEER, AGED 70 YEARS, RESIDING AT PANJOS GARDENS, FLAT NO 17A, PADIVATTOM, EDAPPALLY P.O, KOCHI 682024.** - **3 JAIN JOB ALIAS PAUL, SON OF M P JOB, ENGINEER, AGED 42 YEARS, RESIDING AT PANJOS GARDENS, FLAT NO 16B, PADIVATTOM, EDAPPALLY, KOCHI-682024.** - **4 DR. BIJI ELIZABETH KURIACOSE, WIFE OF JAIN JOB, RESIDING AT PANJOS GARDENS, FLAT NO 16B, PADIVATTOM, EDAPPALLY, KOCHI-682024.** - **5 MUKUNDAN, FLAT NO 4D, PADIVATTOM, EDAPPALLY, KOCHI-682024** - **6 GIRISH NAMBIAR, FLAT NO 8C, PADIVATTOM, EDAPPALLY, KOCHI-682024** - **7 SANTHOSH KUMAR, FLAT NO 10 F, PADIVATTOM, EDAPPALLY, KOCHI 682024** - **8 SREEJITH V, FLAT NO 16D,PADIVATTOM, EDAPPALLY, KOCHI-682024** - **R1, R6-8 BY ADV. SRI.P.U.SHAILAJAN R1, R6-8 BY ADV. SMT.VIDYA KURIAKOSE** **THIS ARBITRATION REQUEST HAVING BEEN FINALLY HEARD ON** **07.01.2020, THE COURT ON THE SAME DAY PASSED THE FOLLOWING:** 3 A.R.No.40 of 2019 ## **P.B.SURESH KUMAR, J.** **-------------------------------------------Arbitration Request No. 40 of 2019 ----------------------------------------------Dated this the 7[th] day of January, 2020.** ## **O R D E R** The petitioners own apartments in an apartment complex called Panjos Gardens. It is stated by the petitioners that they have sustained loss to the tune of Rs.55,26,560/- on account of the illegal and unauthorized conduct of the first respondent, the association of owners of the apartments in the apartment complex. It is also stated by the petitioners that the annual general body meeting of the first respondent held on 02.03.2019 for election of the new Managing Committee of the association was not one properly convened. It is further stated by the petitioners that some of the office bearers elected in the said general body meeting are disqualified from contesting in the election to the offices of the first respondent association. According to the petitioners, the aforesaid disputes are disputes 4 A.R.No.40 of 2019 to be resolved by recourse to arbitration as provided for in the Bye-laws of the first respondent association. It is alleged by the petitioners that though the petitioners have called upon the respondents to take necessary steps to resolve the disputes aforesaid by recourse to arbitration, they are not acting upon the said demand of the petitioners. The petitioners, therefore, seek appointment of arbitrators for resolution of the disputes raised by them in Annexures A2 and A3 notices, in this proceedings under Section 11 of the Arbitration and Conciliation Act, 1996. 2. A counter affidavit has been filed by the seventh respondent on his behalf and also on behalf of the first respondent association. The seventh respondent is the Vicepresident of the first respondent association. The seventh respondent has stated, among others, in the counter affidavit that the petitioners are not members of the first respondent association. It is also stated by the seventh respondent that the disputes raised by the petitioners were the subject matter of OS.No.219 of 2012 on the files of the Munsiff Court, Ernakulam 5 A.R.No.40 of 2019 and that therefore the arbitration request is not maintainable. 3. Annexure A1 is the Bye-Laws of the first respondent association. Clause 26 of Annexure A1 Bye-Laws reads thus: If any dispute concerning constitution of the Committee of the business of the Association (other than a dispute regarding disciplinary action taken by the Committee against a paid servant of the Association) arises: (a) among members, past members and persons claiming through members, past members and deceased members or (b) between a member, past member and person claiming through a member, past member or deceased members and the Association any Committee or any officer, agent or servant of Association; or (c) between Association or its Committee and any past officer, past agent, or past servant or the nominee, heirs or legal representatives of any deceased officer, deceased agent or deceased servant or the Association. Shall be referred to three arbitrators decided by all the members and the decision of the majority arbitrators shall be the final. It is evident from the extracted clause that the disputes between the first respondent and its members are to be resolved by recourse to arbitration. As noted, the contention of the respondents is that the petitioners are not members of the 6 A.R.No.40 of 2019 first respondent association and that insofar as the claim is one that relating to the subject matter of the suit between the parties, the arbitration request is not maintainable. 4. In the light of sub-section 6-A of Section 11 of the Arbitration and Conciliation Act, the Apex court has held in **Duro Felguera S.A v. Gangavaram Port Ltd.** [(2017) 9 SCC 729] that the legislative policy and purpose is essentially to minimize the intervention of courts at the stage of appointing the arbitrator and that the power of the court has now therefore been restricted only to the examination of the question as to whether there exists an arbitration agreement between the parties, nothing more, nothing less. In the light of the subsection 6-A of Section 11 of the Act and the decision of the Apex court referred above, I am of the view that insofar as the existence of the arbitration clause is not disputed, the contentions raised by the respondents are contentions to be considered by the arbitrator. In the result, the arbitration request is allowed and (1) Adv.Sreelal Warriar, Warriar & Co., Advocates, Arbitrators 7 A.R.No.40 of 2019 and Mediators, Warriam Road, P.B.No.5000, Kochi 682 016, (2) Adv.Bindu Sreekumar, Room No.334, KHCAA Golden Jubilee Chamber Complex, Kochi - 31 and (3) Adv.Sri.P.S.Sunil, 1/125, Puthenveettil, MLA Road, Udayamperoor - 682 307 are appointed provisionally as the Arbitrators to resolve the dispute between the parties. The Registry is directed to obtain disclosure statement under Section 11(8) of the Arbitration and Conciliation Act, 1996 from the Arbitrators and place the matter before the court for confirmation of the appointment of the Arbitrators. The Registry shall retain the original of the disclosure statement and append a copy of the same to the order. **Sd/-** **P.B.SURESH KUMAR, JUDGE.** YKB 8 A.R.No.40 of 2019 ## **APPENDIX** **PETITIONER'S/S EXHIBITS:** - **ANNEXURE A1** - **A TRUE COPY OF THE REGISTERED BYLAWS OF PANJOS GARDENS APARTMENT OWNERS ASSOCIATION** - **ANNEXURE A2 A TRUE COPY OF THE NOTICE DATED 26-02-2019 ISSUED BY THE FIRST PETITIONER.** - **ANNEXURE A3 AA TRUE COPY OF THE NOTICE DATED 26-022019 ISSUED BY THE SECOND PETITIONER.** - **ANNEXURE A4** - **A TRUE COPY OF THE CMA(ARBITRATION) NO. 290 OF 2019 BEFORE THE ADDITIONAL DISTRICT COURT, ERNAKULAM.** - **RESPONDENT'S/S EXHIBITS:** - **ANNEXURE R7(A)** - **TRUE COPY OF THE JUDGMENT DATED 24TH MARCH 2015 IN OS 219/2012 OF THE MUNSIFF'S COURT, ERNAKULAM** - **ANNEXURE R7(B) TRUE COPY OF THE PLAINT IN OS NO.13/2018 ON THE FILE OF THE DISTRICT COURT, ERNAKULAM** - **ANNEXURE R7(C) TRUE COPY OF THE JUDGMENT DATED 23.07.2019 IN OP(C) NO.1587/2019 OF THIS HON'BLE COURT.** - **ANNEXURE R7(D) TRUE COPY OF THE ARBITRATION AWARD** - **ANNEXURE R7(E)** - **TRUE COPY OF THE E.PNO.385/2017 FILED IN ARBITRATION CASE BY THE RESPONDENTS BEFORE THE HON'BLE DISTRICT COURT ERNAKULAM.** ## **//TRUE COPY//** ## **PA TO JUDGE**