Law: Arbitration Act, 1940

Section: 20

(a) Words and phrases----Force majeure---Defined. Black's Law Dictionary (Sixth Edition) and Messrs Global Energy and Commodity Exchange Group Italy SPA (GECX Group) v. Trading Corporation of Pakistan 2013 CLD 681 rel. (b) Arbitration Act (X of 1940)--S. 20--- Appointment of arbitrator--- Contract, termination of---Effect---Plaintiff invoked arbitration clause in contract between parties and sought resolving of dispute by appointment of arbitrator---Plea raised by defendant was that by termination of contract, arbitration clause did not survive--- Validity---Termination/cancellation could occur due to breach in contractual obligations by any of the parties to contract which in fact could lead towards a dispute and in order to resolve dispute between parties and even for determination of their rights and liabilities and even a wrongful termination could also be made subject matter of arbitration proceedings otherwise the whole purpose and scheme of incorporation arbitration clause in contract would become redundant and superfluous and it was very easy for any party to terminate and or frustrate contact out rightly in order to avoid arbitration proceedings and claims if any---Cancellation of contract or invoking arbitration proceedings both were two distinct situations, termination clause could not be given overriding effect on arbitration proceedings or provision made for arbitration in contract---Despite cancellation/termination of contract provision of arbitration survived and agreement for arbitration contained in contract was a separate part of contract---High Court appointed arbitrator to resolve and arbitrate dispute between parties---Suit was disposed of accordingly. Firm Karam Narain v. Volkart Bros. AIR (33) 1946 Lahore 116; The Hub Power Company Ltd. v. Pakistan WAPDA PLD 2000 SC 841; Jaikishan Dass Mull v. Luchhiminarain Kanoria & Co. AIR 1974 SC 1579; Khardah Company Ltd. v. Raymon and Co. (India) Private Ltd. AIR 1962 SC 1810; Messrs Friends Trading Co. v. Messrs Muhammad Usman-Moula Bux PLD 1954 Sindh 56; Malik Muhammad Mumtaz v. Malik Abdul Rauf 2002 YLR 2238; Hitachi v. Rupali PLD 1998 SCMR 1618 and Corpus Juris Secundum, Volume-6, 2004,…

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