BBS 3rd year business law important Question | Unit 9 (Contract of Indemnity and Guarantee)

 

👉🏻COURT SYSTEM IN NEPAL

The constitution of Nepal has provided three tiers of court including the Supreme Court, High Courts, and District Courts. The constitution has mentioned the provisions relating to the judiciary under part 11 with the clear provision that the courts and other judicial bodies can exercise the power relating to justice in Nepal under the constitution and other laws and the principles of justice.

👉🏻TIERS OF COURT

1. Supreme Court: It is the highest level of court and is called the court of record. Jurisdiction of the Supreme Court a. Ordinary Jurisdiction b. Extra-ordinary Jurisdiction c. Miscellaneous Jurisdiction
2. High Court: It is a court appeal. It can exercise ordinary and extraordinary powers as per the constitution and laws.
3. District Court: It is a court of first instance. CIVIL PROCEDURE IN NEPAL Procedures to be followed by the court in civil cases are provided under the Code and Civil Procedures, 2074.

👉🏻GENERAL PRINCIPLES CIVIL PROCEDURAL LAW

1. Hearing to be held in open bench
2. Hearing to be made by a competent court
3. Question of entitlement or disentitlement to be settled by court only
4. Disputes relating to legal status are to be settled by the regular court only.
5. Equal treatment of parties
6. One to have locus standing
7. Jurisdiction is not to be in a vacuum.
8. Not to be allowed to avoid making decisions.
9. Opportunity to be given for compromise or mediation
10. Principle of res judicata to be followed
11. Right of appeal

👉🏻ARBITRATION

Arbitration is an alternative depute resolution process where the parties of a dispute refer their disputes and differences relating to civil matters to settle them in a judicial manner to a person a group of persons, called arbitrators, appointed by them without recourse to a court of law whereby the parties of dispute agrees to follow the decision given by them.

👉🏻FEATURES OF ARBITRATION

1. An alternative dispute resolution process
2. A private mechanism for dispute resolution
3. Selected and controlled by the parties
4. Final and binding determination of parties' rights and obligations
5. More expertise service

👉🏻IMPORTANCE OF ARBITRATION

The importance of arbitration can be stated as follows.

1. It is speedy
2. It is simple
3. Less expensive
4. Secrecy or privacy can be maintained.
5. More expertise service
6. Easy execution of the award
7. More convenient in international disputes

👉🏻MATTERS REFERABLE TO ARBITRATION

But this cannot be used to decide all disputes between the parties in a state. What can be referred to? The following matters can be validly referred to arbitration:

1. Matters of a civil nature, i.e., matters relating to property or money.
2. Matters relating to personal rights, i.e., maintenance payable to wife, terms of separation.
3. Dispute relating to dignity and respect-violation of rights.
4. Time-barred claims.

What cannot be referred to arbitration? The following matters are not referable to arbitration:

1. Disputes relating to matrimonial relations, e.g., a suit for divorce or restitution of conjugal right.
2. Testamentary matters; e.g., the questions of genuineness of proofs, evidence, or will documents.
3. Insolvency matters
4. Matters relating to public charities or charitable trusts.
5. Matters relating to the guardianship of a minor lunatic.
6. Criminal matters and disputes.

👉🏻ARBITRATORS AND THEIR APPOINTMENT

Arbitrator

A person who is appointed by the parties of disputes themselves by their mutual consent to act as a judge to decide their dispute impartially and judicially out of the court is called an arbitrator.

Qualification of Arbitrators

a. Person incapable of entering into a contract as per the prevailing law. b. Person punished by a court on criminal charges involving moral turpitude. c. Insolvent or bankrupt. d. Person having any personal interest in the dispute which has to be settled through arbitration.

A person not having any specific qualification specified in the agreement for becoming eligible for the appointment as an arbitrator.

appointment of Arbitrators

as per the Arbitration Act, 2055, By the parties themselves By the order of a court appointment of Arbitrator by Court court for the appointment of an arbitrator in the following circumstances: In case no arbitrator can be appointed as per the agreement. In case the agreement does not mention anything about the appointment of arbitrators.

removal of Arbitrators

Subsection (2) of section 11 of the Arbitration Act, 155, has provided the grounds for the removal of an arbitrator as follows: Bias or partiality of the arbitrator. Improper conduct or fraud in the course of arbitration. If the arbitrator frequently commits mistakes. If any irregularities are committed by arbitrators in the course of arbitration. If the arbitrator does not attend arbitration meetings or refuses to take part in the arbitration proceedings more than three times without furnishing satisfactory reasons with the objective of prolonging or delaying the arbitration proceedings in an improper manner.

If the arbitrator acts opposite to the principles of natural justice. If the arbitrator does not possess the necessary qualifications or loses his qualifications.

👉🏻I PROCEDURES OF REMOVAL

A party intending to remove an arbitrator may submit an application within 15 days from the date of his appointment having knowledge of the conditions for the removal of arbitrators. If the alleged arbitrator does not remove his post voluntarily or the other party does not agree with the grounds, the remaining arbitrators must take a decision within 30 days. If a party does not agree with the decision of the arbitral tribunal may file an appeal to the High Court and the decision of the High Court becomes final.

👉🏻I ARBITRAL AWARD

Ward is a judgment or final decision of an arbitrator or arbitral Tribunal on all matters referred to arbitration. Letters to be mentioned In the Award section 27 of the Act is concerned with the matters to be mentioned in the Award. Therefore, the arbitrator Must explicitly include in the award: a. Brief particulars of the matter referred to them

b. Matter of jurisdiction if asked. c. Issues raised in the hearing to be given the award. d. About the documents, proofs, or other evidence examined by the arbitrator. e. Claims, counterclaims, or particulars of rejoinder. f. Award and its reason g. Cost of arbitration. h. Date place or venue of arbitration, etc.

👉🏻APPEAL AND SETTING ASIDE OF THE AWARD

Any party dissatisfied with the decision taken by the arbitrators and wishes to invalidate the decision may file a petition to the High Court along with the related documents and a certified copy of the decision within 35 days from the High Court may set aside the decision in question.

1. If the agreement is not valid being entered into by or with an incompetent party, or against the law of the country, or not clear.
2. If due notice was not given to appoint an arbitrator or about the arbitration proceedings.
3. If the decision has been given beyond the jurisdiction prescribed for the arbitrator or the decision has been given to other matters which were not referred to the arbitrators.
4. If the arbitrators have acted in such a manner against the provisions of the agreement between the parties or against the provision of the Act

👉🏻EXECUTION OF AWARD

Pursuant to Section 31 of the Act, the concerned parties shall be under obligation to execute the award within 45 days from the date when they receive a copy thereof. In case the parties fail to perform or execute the award within the period of 45 days, the concerned party may file a petition to the Execution Section of the District Court. When such an application is filed, the District Court shall execute or implement the award within 30 days as if its own judgment. Similarly, Section 34 of the Act has provided various provisions for the execution of the award taken in the foreign country by a foreign arbitration tribunal.

👉🏻MAJOR PROVISIONS OF ARBITRATION ACT, 2055

1. Definitions
2. Matters referable to arbitration
3. Number of Arbitrators and their appointment
4. Qualification of Arbitrator
5. Revocation of Arbitrator's authority
6. Powers & Duties of Arbitrators
7. Award
8. Appeal
9. Execution of award