How to enter into an Arbitration agreement ?

An Arbitration agreement may be in the form of Arbitration clause in a contract or in the form of a separate agreement.

An Arbitration agreement has to be in writing.

The requirement as to Arbitration agreement being in writing is fulfilled ;-

1. If the document is signed by the parties
2. If the Arbitration is entered into by exchange of letters, telex, telegrams or other means of communication which provide as a record of the agreement; or
3. An exchange of statements of claim and defense in which the existence of the agreement is alleged by one party and not denied by the other.

The reference in a contract to a document containing an Arbitration clause constitutes an Arbitration agreement if the contract is in writing and the reference is such as to make that Arbitration clause part of the contract. The example of such an Arbitration agreement may be given when the parties simply agree “Arbitration; Bengal Chamber of Commerce and Industry”. Similarly “Arbitration; London Chamber of Commerce and Industries”. This agreement will import the entire rules of the concerned chambers which are in writing in the contract itself and the requirement of Law that the Arbitration agreement has to be in writing will be fulfilled by incorporation of the concerned rules of the concerned chambers. Of course an Arbitration agreement should specify the nature of disputes which are intended to be referred to Arbitration. It should be noted that an oral Arbitration agreement is not permissible in Law.