- The Gujarat High Court ruled that a party cannot seek the appointment of an arbitrator over a "dead" cause of action or resurrect a claim barred by the Law of Limitation.
- The Court was considering an application for the appointment of an arbitrator to resolve a partnership dispute under Section 11(6) of the Arbitration Act. The Petitioner claimed that he and the Respondents formed a partnership in 1994.
- Following the departure of a former partner, a new partnership agreement was entered into under which the Petitioner and Respondents 1-3 became partners, with the Petitioner receiving 25% of the share.
- The Petitioner had filed Regular Civil Suits for various reliefs due to certain disputes. The Petitioner then served notices on the Respondents requesting their consent to the appointment of a sole arbitrator, which was objected to.
- As a result, the current petition was filed. The Respondent disputed the Petitioner's facts and stated that the partnership was dissolved in 2005. Following a meeting, all of the partners agreed that the Petitioner would be removed from the firm.
- In addition, the Petitioner did not sign the dissolution deed. In 2013, one of the Regular Civil Suits was resolved. As a result, the Petitioner's claim was "hopelessly barred by limitation."
- The court noted that the firm was unregistered and that the Petitioner had not signed the dissolution deed.
- Furthermore, the Petitioner had accepted the orders arising from the Regular Civil Suits, but he was attempting to 'take umbrage' with a 2018 order arising from a 2005 Civil Suit for the appointment of an Arbitrator. The Bench determined that the Petitioner was aware of his removal since 2005, but he did not seek arbitration 'for reasons best known to him.'
- In two of the cases, the trial court halted the proceedings in 2007, citing the existence of an arbitration clause in the deed. The Petitioner, however, had failed to apply to the High Court for the appointment of the Arbitrator.
- The Petitioner had erroneously failed to invoke the arbitration clause and had instead filed civil suits.
- Thus, even if the action had begun in March 2010, the cause of action to sue had expired after three years.
- The Bench also reviewed Section 43(1) of the Limitation Act, concluding that the Court can choose not to exercise powers in an arbitration contested when it is clear that the claims are ex-facie time barred, dead, or there is no ongoing dispute.
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