No Privity Of Contract Between Parties, not party to MOU: Delhi High Court Dismisses Section 11(4) A&C Petition
Live LawThe Delhi High Court single bench of Justice Dinesh Kumar Sharma dismissed a petition under Section 11 of the Arbitration and Conciliation Act, 1996 noting that the Petitioners were not party to Memorandum of Understanding containing the arbitration clause, thus there was no privity of contract between the Petitioners and the Respondent. Furthermore, the Respondent challenged the jurisdiction of the court to adjudicate disputes involving non-signatories to the arbitration agreement, emphasizing that the MoU was specifically between Mr. Vaibhav Gupta, Mrs. Shalini Tyagi, and 'Cybiz Brightstar Restaurants Private Limited', thus contesting the validity of the petition initiated by different parties. The High Court noted the dispute started through the MoU dated 14.08.2018 between Mr. Vaibhav Gupta, Mrs. Shalini Tyagi, and 'Cybiz Brightstar Restaurants Private Limited'. The High Court held that there was absence of a contractual nexus, underscored by the Petitioners' acknowledgment, further exacerbated the deficiency of an agreement housing an arbitration clause between the pertinent parties.