Litigation similar to shows on OTT platforms, stages of litigation resemble successive seasons: Delhi High Court

The court held that it was necessary for a party to an arbitration agreement to apply in writing for referring the parties to arbitration.
Litigation similar to shows on OTT platforms, stages of litigation resemble successive seasons: Delhi High Court
Justice Rajiv Sahai Endlaw, Justice Asha Menon

Following the opportunity to watch content on Over-The-Top (OTT) media platforms, a Division Bench of the Delhi High Court recently observed that litigation was similar to the dramas/shows on such platforms, with stages of litigation resembling successive seasons of the dramas/shows (Alok Kumar Lodha vs Asian Hotels).

The judgement authored by Justice Rajiv Sahai Endlaw reads,

“This has also been the season of lockdowns and having an opportunity to watch Over-The-Top (OTT) media platforms and which, as distinct from watching cinema, compressing the story in three odd hours, have shows where the story spans several seasons with each season comprising of several episodes. Holding Court, during the pandemic, virtually from our respective homes instead of from the Courtrooms has also given us opportunity to look at litigation differently and we could not but notice the similarity of litigation with the dramas/shows comprising of several seasons which we have now also had occasion to watch.”

The Court said that not only the stages of the litigation before the suit court and before the appellate court are found to have resemblance to the successive seasons of such dramas/shows, other aspects of litigation are also found to have similarity with such dramas/shows.

“ We will thus give this judgment, the flavour of the seasons of the dramas/shows,” it added before proceeding to author the rest of judgment in the distinctive "seasonal style".

The matter before the Division Bench, which also had Justice Asha Menon, pertained to an appeal from an order passed by a Single Judge Bench.

"The season one of this litigation opened with the filing of the suits, from which these appeals arise, on the original side of this Court, by persons/entities claiming to be occupants of the Shopping Arcade in Hyatt Regency Hotel, Bhikaji Cama Place, New Delhi (hereafter for the sake of convenience and without attributing any legal rights thereto, called as 'Occupants'), with the script in the form of plaint, penned by their counsel..The first episode of season one opened when the suits first came up before the Commercial Division of this Court," the Court recorded.

The Occupants inter alia claimed that the licences in their respective favour with respect to the shops were irrevocable and in perpetuity and thus the termination by the defendant, Asian Hotels (North) Limited was illegal.

Before the single judge, the Hotel raised an objection under Section 8 of the Arbitration and Conciliation Act, 1996 with regard to the maintainability of the suits.

After hearing the parties for "several dates/episodes", the Single Judge , "drew curtains to the first season" by dismissing the suit on account of the disputes being arbitrable.

The Occupants, as well as the Hotel, preferred an appeal against the judgments on several counts.

"The story having thus remained incomplete, both are in appeal in this second season of the litigation, scripted by the counsel for the Occupants as well as the counsel for the Hotel..In subsequent episodes of this second season, the counsel were heard on 24th September, 2020, 12th October, 2020 and 6th November, 2020, when order/judgment was reserved," the Court noted.

In view of the arguments made by the parties, the Court observed that to interpret Section 8 as permitting verbal application, could lead to mischief, as the counsel appearing on behalf of the defendant, can have the suit disposed of or referred to arbitration merely on the basis of a Vakalatnama.

The Court held that it was necessary for a party to the arbitration agreement to apply in writing for referring the parties to arbitration, and a verbal plea in this regard was not sufficient.

"It cannot be lost sight of that all suits where a plea of Section 8 may be required to be taken, do not have such high profile star cast as in the two seasons of this litigation and whose verbal argument carries weight, and to hold the plea of Section 8 to be maintainable, if taken verbally, is fraught of complications and such an interpretation has to be always avoided," the Court remarked.

The Court also held that the order of the single-judge was not an order/judgment of a judicial authority referring the parties to arbitration as it lacked the essential requirements of Section 8.

Therefore, the bar under Section 37 of the Arbitration Act to the maintainability of these appeals was not applicable, the Court added.

".. the order of dismissal of suits on a verbal plea of Section 8 is not an order referring the parties to arbitration under Section 8, so as to be not appealable under Section 37," it said.

The single-judge's order was accordingly set aside.

"We, as students of law, shall wait for the third season, if any," the Court concluded.

[Read Order]

(Alok Kumar Lodha vs Asian Hotels.pdf

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