Scott, C.J:— The petitioner Morarji Jairam Naranji petitions under the indian arbitration act as follows:
“1. That by a Writing in the Gujarati language and character made in Bombay on the 21st March 1918 between respondent 1 of the first part, the petitioner of the second part, and respondent 2, Pitamber Vithalji, of the third part, certain disputes between the said parties in respect of contracts for sales and purchases of piecegoods of ready and forward delivery were referred to the joint arbitration of Messrs Lalji Govindji, Morarji Mathurdas Kamdar (a solicitor of this Hon'ble Court and Solicitor for respondent 1) and Mansukhlal Oghadlal upon and subject to the terms and conditions mentioned in the said writing. By the said writing it was provided that the said arbitrators should publish their award within two months, and power was given to the said arbitrators to further extend the said time by one or two months. A copy of the said writing is hereto annexed and marked A. 2. The said arbitrators entered upon the said references and, after partly proceeding with the reference, they, by their letter of 12th April 1918, addressed to the aforesaid parties to the said reference, informed them that they declined to continue to act further as arbitrators. A copy of the said letter is hereto annexed and marked B.
3. There-upon the petitioner by his attorneys' letter, dated the 24th April 1918, addressed to the respondents, informed them that under the events that had happened the petitioner was entitled to have three arbitrators appointed in place of the said three originally appointed arbitrators under the provisions of S. 8 of the above Act, an suggested the name of the said Mr. Mansukhlal Oghadlal (whom he had induced to act again as arbitrator) as one of the said newly to be appointed arbitrators and called upon them to concur in his appointment and to suggest the names of two other persons as arbitrators within seven clear days after the service of the said letter. A copy of the said letter is hereto annexed and marked C and the office translation of the consent in writing of the said Mr. Mansukhlal Oghadlal to again act as arbitrator, dated 15th May 1918, is hereto annexed and marked D. 4. In reply to the said letter respondent 2, Pitamber Yithalji, by his attorneys' letter dated 14th May 1918, addressed to the petitioner's attorneys, informed them that their client had again appointed the said Mr. Lalji Govindji as one of the arbitrators and that the said arbitrator, Mr. Lalji Govindji, had no objection to continue as arbitrator. Copy of correspondence between the petitioner's attorneys and the attorneys of the said Pitamber Vithalji is hereto annexed and marked E. 5. Respondent 1 has in his attorneys' letter, dated 25th April 1918, addressed to the attorneys of the petitioner, stated that all the three arbitrators having refused to act, the petitioner was not entitled to make any fresh appointment and to call upon respondent 1 to concur in such appointment and to suggest the names of two other arbitrators, and respondent 1 declined to do so. A copy of the, said letter is hereto annexed and marked F.”
2. The prayer is to the Court: (1) to confirm the appointment of Mansukhlal Oghadlal and Lalji Govindji as arbitrators and appoint a third arbitrator and to make an order directing such three arbitrators or only the two above-named to proceed with the reference from the stage where the originally appointed arbitrators left it; or (2) alternatively to appoint three arbitrators to proceed with the reference.
3. It was objected by Gopalji Kuverji that the Arbitration Act did not confer upon the Court jurisdiction to make any such order in the circumstances of the case. Marten, J., before whom the case came in Chambers, held that S. 8 of the Act did give him jurisdiction, and acting upon a subsequent consent of the parties he appointed a single and entirely new arbitrator to dispose of the reference.
4. The reasoning by which the learned Judge arrived at his decision was as follows:
“Section 8(c) contemplates the case of two arbitrators plus an umpire or third arbitrator. As power is given to supply a vacancy caused by the death of the third arbitrator, one would expect a provision to supply a vacancy or vacancies caused by the death of the two first arbitrators. Sub-S. (b), if read liberally, would furnish such provision and if so, it would equally apply to the supply of vacancies caused by the death, refusal, etc., of three arbitrators.”
5. But is it correct to hold that Cl. (b) is meant to cover the case of arbitrators 1 and 2 where the appointment of arbitrator No. 3 falls under Cl. (c) and (d)? I think not because arbitrator No. 3 in the cases supposed in (c) and (d) is in a special category like an umpire appointed jointly by the parties, or by arbitrators Nos. 1 and 2, each of whom is appointed by one of the parties independently of the other. S. 8(1)(b) does not apply to the case of independent appointments of two arbitrators. In such case, when a vacancy occurs, it would ordinarily be filled by the original appointer, as contemplated in S. 9. S. 8(1)(b) only applies in terms to a single vacancy to be supplied by the parties. S. 8 nowhere seems to contemplate the case of two original arbitrators appointed jointly by the parties plus a third of the same class appointed by the two already jointly appointed by the parties. In short S. 8 only applies to certain cases of failure to appoint jointly. Where chooses should but do not concur, the Court is enabled to assist them by the selection and appointment of an individual falling in one of the following categories an (i.e, one) arbitrator; an umpire; a third arbitrator in the special sense in which the term is used. It follows that, in my opinion, Cl. (b) must be read with Cl. (a), and Cl. (d) with Cl. (c), S. 8. The Court is not at liberty to take upon itself to select an individual where the selection is by the submission reserved for one of two disputing parties. The Act does not attempt to provide for every case. It only gives assistance in the commoner cases where joint appointment cannot be arrived at. It is said that the present case is one of joint appointment of three arbitrators. That is probably correct, but it is not one of the common cases of joint appointment contemplated by the section. It is unusual, except perhaps in references in the course of a suit, to have a triangular submission and the joint appointment of three. In Russell on Awards, Part II, Ch. III, S. 3, in the editions of 1870, 1882 and 1906, it is said:
“In case of the death, refusal to act, or incapacity, of a single arbitrator …. a Judge may appoint a new one if the parties do not; and …. where one of two arbitrators fails for the like causes, unless the party appointing him appoints a fresh arbitrator, the remaining arbitrator may be appointed to act alone.”
6. The authority given for this statement is until 1889 the Sections 12 and 13 of the Common Law Procedure Act, 1854 and after that date the Arbitration Act, Sections 5 and 6 (Sections 8 and 9 of the Indian Act), which reproduced Sections 12 and 13 of the Act of 1854. This, as the pronouncement of the standard text-book on arbitration unaltered through a period of 35 years, is a good indication of the understanding of the profession as to the scope of these sections. The dicta of Lindley, L.J and A.L Smith, L.J in In re Smith & Service and Nelson & Sons (1) and Manchester Ship Canal Co. v. S. Pearson and Son, Limited (2) respectively show that those learned Judges understood the provisions in question in the same sense. In my opinion therefore the Court had no jurisdiction to make the order that it did, and the appeal must therefore succeed upon that ground. The appeal is allowed, and the decree is set aside and the petition dismissed with costs throughout upon the petitioner.
Hayward, J.:— The appeal involves a point of importance. The Arbitration Act applies to the appointment of a single arbitrator and in certain cases to the appointment of two arbitrators. Does it apply in any case to the appointment of three arbitrators? It is important to remember in resolving this point that the Act is an Act to amend the law relating to arbitration. It does not deal with the whole law of arbitration and it must be construed strictly, in that it confers special powers of interference not otherwise inherent in the Court. It appears to me, with this in mind, that it applies primarily to the ordinary commercial contracts in which the reference is to a single arbitrator or else to two arbitrators, one appointed by each party, with power to call in a third arbitrator or leave the decision to an umpire. Such are the references treated in Ss. 1 and 2 and at p. 202 in S. 3, Ch. 4 of Russell on Arbitration, Edn. 4 of 1870. This application is indicated by S. 6, which provides that a submission shall be deemed ordinarily to be to a single arbitrator and that if the reference is to two arbitrators they shall have power to appoint an umpire; while S. 8(1)(a) and (b) proceeds to provide for the failure of the parties to nominate the single arbitrator or the failure of the nominated arbitrator to proceed with the arbitration, and S. 9 for the failure of either of the parties to nominate either of the two arbitrators or the failure of either of the nominated arbitrators to proceed with the arbitration, while provision has already been made in S. 8(1)(c) and (d) for the failure of the parties or the two arbitrators to nominate the third arbitrator or the umpire. It has been provided that the arbitration shall in all these cases be made effective, if necessary, by the special interference of the Court. These provisions of the arbitration act reproduce verbatim the English Statute, 1889. It is not, in my opinion, open to us to extend this special jurisdiction to special contracts not clearly contemplated and expressly mentioned by the Act. Thus it is not open to us to interfere where the reference is to two arbitrators to be appointed, not one by each party, but the two jointly by the two parties. There is no provision in S. 8 for interference on the failure of the parties jointly to nominate the two arbitrators. Nor do Cls. (a) and (b) read together provide for interference on the failure of two arbitrators so nominated to proceed with the arbitration. These two clauses must, in my opinion, be read together and “the words the appointment of an arbitrator” at the end of Cl. (a) read as repeated in the words “if an appointed arbitrator” at the opening of Cl. (b), just as the two clauses (c) and (d) have also plainly to be read together. It would, in my opinion, be repugnant to the arrangement and plain meaning of Section 8 of the Arbitration Act, to give effect to the general provisions of Section 13 of the General Clauses Act.
7. It is similarly, in my opinion, not open to us to interfere where the reference is to more than two arbitrators and the parties fail to nominate the arbitrator or the arbitrator fail to proceed with the arbitration. There is no provision in S. 8, Cls. (c) and (d), providing for a difference of opinion between two arbitrators and settlement by a third arbitrator or by an umpire.
8. Such references are thus treated at p. 203, S. 3, Ch. 4 of Russell on Arbitration, Edn. 4 of 1870:
“The arbitrators selected, one by each side, ought not to consider themselves the agents or advocates of the party who appoints them … In order to ensure a decision in case of difference of opinion, the submission frequently goes on to prescribe that the two arbitrators shall name a third and that an ward made by any two, if they cannot all agree, shall be sufficient. If the two arbitrators do not appoint a third arbitrator or an umpire, when at liberty to do so, a Judge may appoint …”
9. Russell proceeds to distinguish the duty of a third arbitrator from that of an umpire:
“The arbitrators named by the parties often seem to think that they are to represent their respective no minors and act rather as advocates than Judges, while the third arbitrator frequently supposes he is an umpire and that his active interference is not to commence until the others have differed finally…”
10. And at p. 211, S. 4:
“Where two arbitrators are appointed, the submission often provides that in case of their not agreeing in award, the matters shall be decided by a third person, who is styled an umpire.”
11. Clauses (c) and (d), S. 8, do not, in my opinion, provide for interference where the reference is not to two arbitrators with power to settle differences of opinion by summoning a third arbitrator or referring the matters to an umpire, but is, as here, directly to three arbitrators. Such references would appear not to have been included within the particular provisions of Ss. 8 and 9, though they might fall within the provisions of the other sections including Section 19 of the Arbitration Act. This would appear to have been the view held in In re Smith & Service and Nelson and Sons and in Manchester Ship Canal Company v. S. Pearson & Son, Limited , under the English Statute relied on in para. 964, Vol. 1, Halsbury's Laws of England. The appeal should therefore in my opinion be allowed as the appellant and two respondents referred their dispute direct to three arbitrators; and Marten, J., had no jurisdiction on their refusal to proceed with the arbitration to appoint fresh arbitrators under the Arbitration Act. It would not be necessary in this view of the matter to decide whether the special powers conferred by the Act were discretionary with the Court. It would appear to me however that Marten J., placed the right interpretation upon the decision in In re Eyre & Corporation of Leicester (3) and that the word “may” never can mean “must” so long as the English language retains its meaning, though the exercise of a discretionary power conferred by the word “may” might, in certain circumstances being established, become imperative on the Judge, as observed by Cotton, L.J, in In re Baker (4). It would farther appear to me that it would not have been proper for us to interfere with the exercise of the discretion vested in Marten, J., merely upon our own views of the desirability or otherwise of leaving the parties in this particular matter to their ordinary remedies in the Court.
G.P/R.K
12. Appeal allowed.