No response doesn’t mean consent for appointment of Arbitrator

S. K. Builders v. CLS Construction Pvt. Ltd.

Court – Delhi High Court

Citation – O.M.P. (COMM) 297/2023

Date – 08.08.2025

The Hon’ble Delhi High Court has held that no response does not mean consent for appointment of Arbitrator. Appointment requires positive consent and in the absence of it, the appointment becomes unilateral and illegal.

The Court held,

“22. Unilateral arbitration is an oxymoron. Consent, to the arbitration as well as the arbitrator, is the very raison d’etre of the arbitral process. Unilateral appointment of an arbitrator is, therefore, completely proscribed. Section 11 of the 1996 Act specifically envisages consensus ad idem on the Arbitrator who has to arbitrate on the disputes. In the present case, besides, Clause 16 of the MoU clearly envisaged appointment of the Arbitrator by consent of the parties.

24. It is well settled that consent requires consensus ad idem. There must be positive consent on the part of the petitioner to the appointment of an Arbitrator. Absent such consent, the appointment becomes unilateral and ex facie illegal.

25. I am also in agreement with the decision of the Coordinate Bench in Lt. Col. H.S. Bedi in which this Court held that the mere insertion, in the Section 21 notice, of a caveat that failure to object to the arbitration of the disputes by the named Arbitrator would imply consent, would not necessarily mean that the opposite party had consented to the arbitration as it did not expressly object.

26. The appointment of the Arbitrator in the present case was therefore, unilateral. The arbitral proceedings would, even on that score, stand vitiated ab initio.”

— Team AMLEGALS

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