Madras Sporting Youngsters Football Club vs. Tamil Nadu Football Association and Ors. (Madras High Court, decided on 31.01.2022),
was a Petition under Section 11 of the #arbitration & conciliation Act, 1996 for appointment of and #arbitrator, where this question was raised.
Here Madras Sporting Youngsters Football Club (MSYFC) was challenging the appointment of the 4th Respondent (R4), as the secretary of the TN Football Association, and was relying on the arbitration clause contained in the by-laws of the TN Football Association.
The court observed as follows:
1. The dispute raised by MSYFC is an election dispute TN Football Association, in which R4 was elected as Secretary. R4 is not a member of the TN Football association as only Football clubs can be its members.
2. Therefore R4 is not a party to the by-laws of the TN Football association, which contain the arbitration clause. He has neither signed the by-laws nor agreed to the terms and conditions contained therein.
3. By-laws of a society are internal regulations of the said society applicable only to its members, and is a public document. It is not a person-centric or private documents.
4. Therefore, several parties may be interested in the by-laws such as players, stage, members, etc. In view of the same, the election dispute raised by the Petitioner in terms of by-laws can be adjudicated only through public fora (Courts) & not through Arbitration, which is confidential in nature.
5. Matters such as actions for enforcement of in-rem rights can only be adjudicated by public fora, and stand excluded from purview of private fora by necessary implication such disputes are incapable of being resolved in arbitration. (Reliance placed on Booz Allen & Hamilton Inc. V. SBI Home Finance Ltd., 2011 5 SCC 532)
6. If the subject matter of a dispute affects third party rights, it is not arbitrable. (Reliance placed on Vidya Drolia V. Durga Trading Corporation 2021 (2) SCC 1)
7. Disputes involving public interest or interests of numbers persons not parties before Court and disputes relating to election to public offices are non-arbitrable. (Reliance placed on Afcons Infrastructure Ltd. V. Cherian Varkey 2010 (8) SCC 24)
In view of the above observations, the Court dismissed the Petition under Section 11 for appointment of arbitrator.
