Doctrine of Party Autonomy:
The Supreme Court recently held that the Doctrine of Party Autonomy is not limitless, and the same is the bedrock of arbitration.
- The fundamental principle governing arbitration is party autonomy.
- The freedom of the parties to choose the process of resolving disputes is known as party autonomy.
- It confers on the parties the freedom to determine laws, place of arbitration, selection of arbitrators, etc.
- Almost all international arbitration laws, rules, and conventions recognize the principle of party autonomy.
- The concept is recognised under the New York Convention, the UNCITRAL Model Law, the Indian Arbitration and Conciliation Act, 1996, the International Chamber of Commerce (ICC) Arbitration Rules, etc.
- However, party autonomy is not unlimited, and it may be subject to certain legal or public policy constraints depending on the jurisdictions involved.
- The Supreme Court of India (SC), in the April 2021 judgment, ruled that “Party autonomy is the guiding spirit of arbitration”.
- The SC also held that such autonomy must be exercised on an equal footing, with both parties having a meaningful participation in the arbitrator appointment process.
- Any imbalance, where one party has disproportionate control, risks undermining the arbitrator’s independence and impartiality.
