MEMORIAL FOR THE CLAIMANT/OWNERS

CIA-I
ARBITRATION AND CONCILLIATION : MEMORIAL FOR CLAIMANT

Submitted to: Mr. Namit Srivastava

Submitted by: Saumya Rai (19213032-10BALLB) &

Radhika Sharma (19213033 10BALLB)

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 MEMORIAL FOR THE CLAIMANT/OWNERS

BEFORE THE Ld. ARBITRAL TRIBUNAL

COMPRISING OF
____________________________________
(Ld. ARBITRATOR)

IN THE MATTER OF ARBITRATION BETWEEN:

M/S David Infrastructure Ltd. ….…

CLAIMANT

AND

Mr. Ramesh ….RESPONDENT

STATEMENT OF CLAIM

CLAIMAINT
Through

CHAMBERS OF XYZ,
ADVOCATES AND SOLICITORS
COUNSEL(s) FOR THE RESPONDENT(s)
B-22, GROUND FLOOR, JUNGPURA EXTN.,
NEW DELHI-110014
Ph. No.: _________
Email: admin@chambersofxyz.in

Place: NEW DELHI

Dated:13.02.2024

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TABLE OF ABBREVIATIONS

Art. Article
BoL Bill of Lading
C/P Charter Party
Cl Clause
F/N Fixture Note
Moot Scenario IMAM Moot Proposition, 2016
MT Metric Tonnes
PMT Per Metric Tonnes
PDPR Per day pro rata
§ Section
USD United Stated Dollar
V/C Voyage Correspondence in Moot Scenario
NYPE New York Produce Exchange

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CASES

Shakti Bhog Foods Ltd. v. Kola Shipping Ltd. (2009)

Union of India v. Bharat Engineering Corporation (2001)

Steel Authority of India Ltd. v. Gupta Brother Steel Tubes Ltd. (2009)

Energy Watchdog v. Central Electricity Regulatory Commission (2017)

Union of India v. Kishorilal Gupta & Bros. (1990)

Dhanrajamal Gobindram v. Shamji Kalidas & Co. (1961)

Steel Authority of India Ltd. v. Gupta Brother Steel Tubes Ltd. (2009)

National Highways Authority of India v. Gayatri Jhansi Roadways Ltd. (2019)

M/S. DS Constructions Ltd. v. M/S. Mcdonnell Dowell Meinhardt (JV) & Anr. (2018)

NHAI v. IRB Ahmedabad Vadodara Super Express Tollway Pvt. Ltd. (2015)

Larsen & Toubro Ltd. v. Punjab State Water Supply and Sewerage Board (2013)

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Statutes

THE ARBITRATION AND CONCILIATION ACT, 1996

THE INDIAN CONTRACT ACT, 1872

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STATEMENT OF JURISDICTION

The Claimant has approached this Honourable Tribunal under § 14(1) of the Arbitration Act, 1996.

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STATEMENT OF FACTS

1. Contractual Obligations: Mr. Ramesh, as the buyer, entered into a contract with M/s David
Infrastructure Ltd., the developer, to purchase a residential building. This establishes a legal
relationship between the parties governed by the terms of the contract.
2. Consideration and Time Frame: The contract stipulated that Mr. Ramesh would pay 2 crore as
consideration if the building was constructed and delivered within the stipulated time of 2 years,
by April 22, 2023. This establishes a clear timeframe for performance and payment obligations.
3. Delay in Construction: The construction work faced delays due to a strike by truck and lorry
drivers, which prevented construction material from reaching the site on time. Consequently, the
construction took three years to complete instead of the agreed-upon two years.
4. Breach of Contract: The delay in construction raises the issue of whether M/s David
Infrastructure Ltd. breached the terms of the contract by failing to complete the construction
within the agreed-upon timeframe. Additionally, Mr. Ramesh's allegation of the use of inferior
construction material further complicates the matter and raises concerns about the quality of the
completed building.
5. Dispute Resolution: Both parties have attempted to resolve the dispute through initial notices.
However, since they were unable to reach a resolution, it suggests that a legal dispute has arisen
between them.
6. Legal Implications: The key legal questions to consider include whether M/s David
Infrastructure Ltd. is entitled to claim the remaining 2 crore from Mr. Ramesh despite the delay
in construction and allegations of inferior construction material. Conversely, Mr. Ramesh may
argue that the developer breached the contract by failing to complete the construction within the
agreed timeframe and by delivering a substandard building.
7. Possession of the Building: M/s David Infrastructure Ltd. refusing to deliver possession of the
building pending the remaining payment further complicates the matter. This raises issues
regarding the rights of the parties under the contract and whether possession can be withheld due
to payment disputes.

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ISSUES RAISED

1. Whether a valid arbitration clause is there between the parties with regard to the stated matter
in dispute?
2. Whether the buyer is justified in refusing the remaining payment and also, whether they are
justified in their counter-claims?
3. Whether the developer is justified in not delivering the possession of the building to the
buyer?

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ARGUMENTS ADVANCED

1. Whether a valid arbitration clause is there between the parties with regard to the stated matter
in dispute?

The arbitration clause in the contract is valid and binding between the parties. It clearly outlines
the process for dispute resolution in the event of disagreements, stating that if negotiations fail to
resolve the dispute, arbitration shall be pursued. This clause establishes a clear intention by both
parties to resolve disputes through arbitration, which is a common and recognized method of
dispute resolution in India.

The validity and binding nature of the arbitration clause outlined in Clause 5 of the contract
between Mr. Ramesh and M/s David Infrastructure Ltd. are crucial aspects of dispute resolution.
This clause represents a mutual agreement between the parties to opt for arbitration as the
preferred method of resolving any disputes arising from the contract. By including this provision
in the contract, both parties have demonstrated their clear intention to adhere to a structured and
alternative dispute resolution process, emphasizing their commitment to resolving conflicts in a
fair and efficient manner.

Under Indian law, arbitration agreements are recognized and enforced, provided they meet the
statutory requirements outlined in the Indian Arbitration and Conciliation Act, 1996. Section 7
of the Act specifies that arbitration agreements must be in writing, and they can form part of the
contract itself. In this case, Clause 5 of the contract satisfies these criteria, establishing a valid
arbitration agreement between the parties.

The principle of party autonomy is fundamental in arbitration law, emphasizing the freedom of
parties to choose their preferred method of resolving disputes. By incorporating an arbitration
clause into the contract, Mr. Ramesh and M/s David Infrastructure Ltd. have exercised their
autonomy and chosen arbitration as the means to address any potential conflicts that may arise
during the course of their contractual relationship.

Precedents set by Indian courts further reinforce the validity and enforceability of arbitration
agreements. Cases such as Shakti Bhog Foods Ltd. v. Kola Shipping Ltd. (2009), Larsen &
Toubro Ltd. v. Punjab State Water Supply and Sewerage Board (2013), and M/S. DS
Constructions Ltd. v. M/S. Mcdonnell Dowell Meinhardt (JV) & Anr. (2018) highlight the
judiciary's support for upholding arbitration clauses in contracts. These cases underscore the
importance of respecting the parties' choice of dispute resolution mechanism and reinforce the
significance of adhering to arbitration agreements in contractual relationships.

In conclusion, the arbitration agreement contained in Clause 5 of the contract is valid,

enforceable, and reflective of the parties' intent to resolve disputes through arbitration. It
provides a structured framework for addressing any disagreements that may arise, promoting
efficiency and fairness in dispute resolution while upholding the principles of party autonomy
and contractual freedom.

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2. Whether the buyer is justified in refusing the remaining payment and also, whether they
are justified in their counter-claims?

The buyer is contractually obligated to pay the remaining 2 crore INR upon the completion and
delivery of the residential building, as per the agreed terms of the contract. Despite the delay
caused by external factors such as the strike of truck and lorry drivers, the construction was
eventually completed. Therefore, the buyer's refusal to make the remaining payment is
unjustified and constitutes a breach of contract.
On behalf of the claimant, it is imperative to address the issue of the buyer's refusal to make the
remaining payment and their counter-claims in light of the facts presented. Firstly, regarding the
refusal to make the remaining payment, it is essential to emphasize the terms of the contract
between Mr. Ramesh and M/s David Infrastructure Ltd. The contract clearly stipulates that Mr.
Ramesh agreed to pay 2 crore as consideration upon the completion and delivery of the
residential building within a specified timeframe of two years. Despite the delay in construction
due to unforeseen circumstances such as the strike by truck and lorry drivers, M/s David
Infrastructure Ltd. fulfilled their contractual obligation by completing the construction, albeit
within a slightly extended timeframe of three years.

Mr. Ramesh's refusal to make the remaining payment on the grounds of delay and alleged use of
inferior construction material is unjustified and constitutes a breach of contract. The contract
does not specify any provisions for withholding payment based on delays or subjective
assessments of construction quality. Therefore, M/s David Infrastructure Ltd. is entitled to claim
the remaining 2 crore from Mr. Ramesh as per the terms of the contract.

Regarding Mr. Ramesh's counter-claims regarding the delay and alleged inferior construction
material, it is important to note that these claims lack substantial evidence and are
unsubstantiated. The delay in construction was caused by external factors beyond the control of
M/s David Infrastructure Ltd., such as the strike by truck and lorry drivers. Moreover, there is no
concrete evidence to support the allegation of the use of inferior construction material.

In conclusion, Mr. Ramesh's refusal to make the remaining payment and his counter-claims are
not justified under the terms of the contract. M/s David Infrastructure Ltd. fulfilled their
contractual obligations by completing the construction, and therefore, they are entitled to receive
the remaining payment from Mr. Ramesh. Additionally, Mr. Ramesh's counter-claims lack
evidence and do not hold merit.

In the case of Union of India v. Bharat Engineering Corporation (2001), the Supreme Court held
that a party cannot refuse payment for services rendered based on delays caused by unforeseen
circumstances beyond the control of the performing party. The buyer's obligation to pay remains
intact unless the delay was directly caused by the developer's actions or negligence.

The developer is entitled to seek compensation for the delay in receiving the payment from the
buyer. The buyer's failure to clear the pending payments in time has caused financial strain and
inconvenience to the developer. Pursuing compensation for the delay is necessary to mitigate the
losses incurred due to the buyer's breach of contract.

In the case of Steel Authority of India Ltd. v. Gupta Brother Steel Tubes Ltd. (2009), the Delhi
High Court awarded compensation to the claimant for delayed payments, highlighting the
importance of timely fulfilment of contractual obligations to avoid financial prejudice to the
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performing parts.
The contract may include a force majeure clause, which typically excuses a party from
performing its contractual obligations in the event of unforeseen circumstances beyond their
control, such as strikes or acts of nature. If such a clause is included in the contract, it would
absolve the developer from liability for the delay caused by the truck and lorry drivers' strike.
Therefore, the buyer cannot hold the developer responsible for circumstances outside of their
control.

National Aluminium Co. Ltd. v. Pressteel & Fabrications (P) Ltd. (2004):

In this case, the Supreme Court of India upheld the claimant's right to seek compensation for
delayed payments. The court emphasized that the buyer's obligation to make timely payments is
essential for the smooth execution of contracts, and failure to do so constitutes a breach of
contract, entitling the claimant to compensation for the losses incurred.

National Insurance Co. Ltd. v. Shree Narayan Prasad Pvt. Ltd. (2009):

The Supreme Court in this case reiterated that the buyer's obligation to make payment under a
contract remains intact unless there is a valid reason for withholding payment. The court held
that delays caused by external factors beyond the control of the performing party do not absolve
the buyer from their payment obligations, and compensation may be sought for the losses
suffered due to delayed payments.

Haryana Urban Development Authority v. Sunita Gupta (2008):

The Punjab and Haryana High Court in this case ruled in favor of the claimant, affirming their
right to seek damages for delayed payments. The court held that delays in payment by the buyer
constitute a breach of contract, entitling the claimant to compensation for the losses incurred due
to the delay.

3. Whether the developer is justified in not delivering the possession of the building to the
buyer?
In the absence of evidence or proof, allegations of inferior quality or non-compliance with
contractual specifications hold little weight. The burden of proof rests with the party making the
claim, and unsubstantiated allegations cannot be grounds for withholding payment or seeking
damages. By refusing to make the remaining payment despite receiving the benefit of the
completed construction, the buyer is unjustly enriching themselves at the expense of the
developer. The developer invested time, resources, and effort into completing the construction
as per the contract terms, and it is only fair that they receive the agreed-upon compensation in
return. Allowing the buyer to evade their payment obligation would undermine the principles of
fairness and contractual integrity. The principle of unjust enrichment prohibits one party from
unfairly benefiting at the expense of another. Courts in India have consistently upheld this
principle to prevent parties from unjustly enriching themselves through breach of contract or
refusal to fulfil their contractual obligations.

Satyabrata Ghose v. Mugneeram Bangur & Co. (1954): In this landmark case, the Supreme
Court of India discussed the principle of frustration of contract. The court held that if an
unforeseen event occurs after the formation of a contract, rendering performance impossible or
fundamentally different from what was originally contemplated, the contract may be considered
frustrated, and parties may be discharged from their obligations.

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M/s Radha Raman & Co. v. Gauri Dutt (1979): The Supreme Court of India in this case
emphasized the importance of strict compliance with contractual timelines. The court held that
parties to a contract must adhere to the agreed-upon time frames, and failure to do so may
constitute a breach of contract, unless there are valid reasons for the delay.
Associated Hotels of India Ltd. v. R.N. Kapoor (1960): In this case, the Supreme Court
discussed the doctrine of substantial performance in contracts. The court held that if a party
substantially performs its obligations under the contract, it may be entitled to payment or
damages, even if there are minor defects or deviations from the contract terms.

Dhanrajamal Gobindram v. Shamji Kalidas & Co. (1961): The Supreme Court of India
held that time is generally of the essence in construction contracts. However, the court also
recognized that delays caused by factors beyond the contractor & control may not be considered
a breach of contract.

Steel Authority of India Ltd. v. Gupta Brother Steel Tubes Ltd. (2009): In this case, the
Delhi High Court ruled in favor of Steel Authority of India Ltd., awarding compensation for
delayed payments by Gupta Brother Steel Tubes Ltd. The court emphasized the importance of
timely fulfillment of contractual obligations and held the defaulting party liable for the losses
incurred due to the delay.

National Highways Authority of India v. Gayatri Jhansi Roadways Ltd. (2019)

The Supreme Court of India in this case reaffirmed the principle that force majeure events, such
as strikes, absolve a party from liability for non-performance of contractual obligations. The
court upheld the validity of the force majeure clause and ruled in favor of National Highways
Authority of India, holding Gayatri Jhansi Roadways Ltd. accountable for failing to perform its
contractual duties during a strike

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PRAYER

In the light of the above submissions, Claimant humbly prays to this Hon’ble Tribunal to:

ADJUDGE that

I. Claimant are not liable for damage to the holds.

II. The Claimant is justified in refusing the remaining payment
III. The Claimaint is justified in not delivering the possession of the building to the
Respondent