'Witness may lie but the documents do not.'14
The production of documentary evidence holds major importance towards the outcome of any commercial dispute. Production of documents is necessary as it helps the tribunal to deliver a reasoned award. Parties submit the documents to the arbitral tribunal to support their claim, counter claim or defense. The problem usually arises when parties rely on the documents which are in the possession of the opposite party.
Domestic arbitrations in India are governed by Arbitration and Conciliation Act, 1996. In the case of Thyssen Krupp Werkstoffe GMBH v. Steel Authority of India, MANU/DE/0386/2010, it was held that though there is no specific provision under the Arbitration and Conciliation, 1996 specifically conferring power on the arbitrator to direct discovery, the arbitrator has absolute power and flexibility to conduct the proceeding as he may consider appropriate and is not bound by the Indian Evidence Act, 1872 and Code of Civil Procedure, 1908.15 Further, it was held that Section 27 of the Arbitration and Conciliation Act, 1996 only deals with third-party discovery and not with the discovery of parties. However, in the case of the Delta Distilleries Limited v. United Sprits Limited, AIR 2014 SCC 13, the Hon'ble Supreme Court interpreted that the term 'any person' under Section 27 (2) (C) of the Act, 1996 is not just limited to the witnesses but also covers the parties.
Likewise, in another case Silor Associates v. Bharat Heavy Electrical Limited, 213 (2014) DLT 312, it was submitted by the Supreme Court that the tribunal is empowered by its own to direct the parties to produce the documents without taking assistance from the court under Section 27 of the Arbitration and Conciliation Act, 1996 and upon failure to comply with the directions of the tribunal to produce the documents, the aggrieved party may draw adverse inference against the defaulting party or may require the tribunal to enforce the same direction with the assistance of the court under Section 27 of the said Act.
The parties cannot just directly approach the court under Section 27 to seek assistance from the court. It is necessary for the parties to seek permission from the arbitral tribunal before filing an application under Section 27 before the court.16 The tribunal is not under any obligation to grant such a permission. The pleadings are before the tribunal and the arbitrator(s) are the master of the case. The tribunal has to conclude whether or not the evidence requested to be produced is relevant or not.17 It is appurtenant to note that the exercise of power under Section 27 is to just assist in taking evidence and not to determine the admissibility, relevancy, materiality, and weight of any evidence.18
The reason why parties prefer arbitration over litigation is due to the flexibility arbitration has to offer. The parties are free to choose their own arbitrator, the number of arbitrators (odd number), the governing law, the seat of arbitration, whether or not to have any witnesses, whether or not to have any documentary evidence or just have it completely oral based (like in the cases of fast-track procedures). However, in most cases parties prefer having documentary evidence. Production of documents helps the parties to support their claims by which the arbitrator can deliver a well reasoned award. Therefore, the arbitral tribunal has the power to get the evidence as it may become necessary.19
Emerging trends for discovery in the field of arbitration :
1. Redfern Schedule: is a collaborative document which both parties and the tribunal use for the production of documents. It is usually used for international arbitrations to create records for the requests for production of documents and responses between both parties.
Sample of Redfern Schedule:
| S. No. | Claimant's Request | Claimant's Reason for Request | Respondents Objection | Claimant's Comments/ Reply | Tribunal's decision |
The only reported case to have used Redfern Schedule is Thiess Iviinecs India v. NTPC Limited, MANU/ DE/0748/2016.
E-Discovery: In legal proceedings, it is not uncommon to have discovery. E-discovery is the electronic discovery. It is the process of storing, compiling and securing data such as files, E-mails, documents, database, bills, etc. for evidence in legal proceedings. E-discovery is very helpful as it is reliable and saves time. More than 3 Zettabytes (1ZB= 1 Billion of Terabytes (TB)) of the digital data is stored around the world. A large amount of time is being used in litigation and also in arbitration. Although parties may agree to limit discovery or have no discovery at all (in arbitration) but there is still a large amount of data being used in proceedings these days.20 With the advancement in technology, promising software such as TAR (Technology Assisted Review) has now come into existence. This software runs on an algorithm which helps in prioritizing the documents in terms of their relevance. It provides accurate discovery and also delivers more consistent review. This kind of technology should be used more often as it saves time and cost, significantly. TAR was first used by US courts21, followed by the Irish courts22. Recently, even the UK Courts have joined the US and Irish courts accepting E-discovery23. "E-discovery is a game changer," proclaimed Jayesh H, founder, Juris Corp. "Any data, which could be denied in discovery, can be retrieved using recovery software," "But E-discovery is not a search and seizure process. If handled well, it can expedite dispute resolution."24
Conclusion :
After the amendment of Arbitration & Conciliation, 1996 the Indian courts have become more arbitration friendly. Indian arbitration proceedings should not hesitate from using Technology software programs such as TAR which are likely to change the future of discovery in arbitration.
Footnotes
14 Vishnu @ Undrya v. State of Maharashtra, [2005] Insc 671 (24 November 2005), Para 12. Line 13
15 Section 19
16 Satinder Narayan Singh v. Indian Labour Co-operative Society ltd., (2008) 1 Arb LR 355
17 Hindustan Petroleum Corporation v. Ashok Kumar Garg (2007) 1 Arb LR368
18 Thiess Iviinecs India vs Ntpc Limited & Anr, MANU/ De/0748/2016
19 Delta Distellaries limted united spirit 2014 case
20 How Technology Assisted Review Can Decrease the Cost of E-Discovery in Arbitrations By Ignatius Grande and Joseph Lee
21 Da Silva Moore v. Publicis Groupe, Judge Peck. 11 Civ. 1279 (ALC) (AJP)
22 Irish Bank Resolution Corp. v. Quinn, [2015] IECH 175
23 Pyrrho Investments Ltd. v. MWB Property Ltd., 2016 EWHC 256 (Ch), Judge Master Paul Matthews
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
