Khetram v. The New India Assurance Co. Ltd. Civ. Case 23-A-67, 16/9/68, Platt, J.

Khetram v. The New India Assurance Co. Ltd. Civ. Case 23-A-67, 16/9/68, Platt, J.

An insurance contract contined a clause requiring all disputes under the policy to be submitted to arbitration and making an arbitration award a condition precedent to a right of action against the insurer. In an action on the policy by the insured who had not first obtained an arbitration award, the insurer pleaded the arbitration provision and asked for dismissal. In argument, but not in its pleadings, insured claimed: (1) that the condition precedent of an arbitration award had been waived; and (2) that the insurer should have applied for a stay of proceedings and not pleaded that no right of action had arisen.

            Held: Obtaining an arbitration award can properly be made a precedent to  right of action. Scott v. Avery (1843-60) All E.R. Rep. 1. Waiver of a condition precedent must be pleaded and it was not in this case. Shah v. South British Ins. Co., (1962) E.A. 131. Section 6 of the Arbitration Ordinance (cap. 15) permits the defendant to apply for a stay of proceedings and a referral to arbitration but it does not require such action. The defendant retains his right to request dismissal for failure to comply with the condition precedent that an arbitration award be obtained. Suit dismissed.