Calcutta High Court Upholds Arbitral Award In Favour Of Sourav Ganguly Over Termination Of Player Representation Agreement

The Calcutta High Court bench of Justice Ravi Kishan Kapur dismissed a Section 34 petition filed against an arbitral award passed in favour of cricket player Sourav Ganguly (“Respondent”) by his former management agency, Precept Talent Management Ltd. (“Petitioner”). While upholding the Arbitral Award, the Court observed that the award was well reasoned and the views taken by the Arbitral Tribunal were plausible. Therefore, the Award did not warrant any interference by the Court. Facts The present application has been filed under Section 34 of the Arbitration Act, challenging an award dated December 09, 2018, read with supplementary award dated March 08, 2019 (collectively “the award”).The Respondent, Mr. Sourav Ganguly, a cricketer of international repute, had entered into a Player Representation Agreement (“PRA”) dated October 22, 2003 with the Petitioner No.2, whereby the Respondent appointed the Petitioner No.2 as his sole and exclusive manager and agent on terms and conditions enumerated in the PRA. During the subsistence of the PRA, by a deed of assignment dated April 21, 2007, executed between and the Petitioner No.1, the rights and obligations of the Petitioner No.2 under the PRA were assigned to the Petitioner No. 1. Disputes arose between the parties when sums due to the Respondent were not paid by the Petitioners, and unauthorised withdrawals were made by the Petitioner from the Respondent's escrow account. The matter was taken up by an arbitral tribunal comprising of three arbitrators who unanimously held in favour of Mr. Ganguly and awarded him a sum of Rs 14,49,91,000/- with additional interest and costs. Contentions The Counsel for the Petitioner submitted that the Arbitral Tribunal failed to give the Petitioners the benefit of the consideration received by the Respondent under the KKR contract dated August 21, 2008, between Knight Riders Sports Private Limited and the Respondent. It was stated that the tribunal also failed to hold that the petitioners could not be jointly liable in view of the assignment whereby the rights and liabilities of the Petitioner No. 2 had been assigned in favour of the Petitioner No.1. The Counsel for Mr. Ganguly submitted that there were no grounds to interfere with the impugned award. The impugned award was reasoned and adequately dealt with each of the contentions raised by the Petitioners. In view of the above, the termination of the PRA was unwarranted and contrary to the terms of the PRA. In any event, the interpretation of the terms of the PRA is the exclusive domain of the Arbitral Tribunal and there is no scope for interference. Observations On the issue of the right of Petitioners to terminate the PRA, which was decided against them by the Arbitral Tribunal, the Court analysed Clause 15.3 of the PRA. The said clause provided the Petitioners had an unconditional right to terminate the PRA by providing a written notice to the Respondent in case of two eventualities (i) mere non-selection, (ii) non selection for continuous period exceeding six months. In both events, the Petitioners were conferred with additional and unconditional rights to terminate the PRA after the expiry of six months. The Court noted that the Respondent had lost his place in the Indian Cricket Team in February, 2006. The Petitioners had terminated the PRA on November 21, 2007.The event of variation entitling the Petitioners to terminate was triggered on August 1, 2006 i.e. on completion of six consecutive months of the Respondent's non-selection. The Respondent was again re-selected as a regular player on November 30, 2006. The Court highlighted that during this period there was not a single letter or document which would demonstrate that the Petitioners contemplated termination. It was only 16 months after the occurrence of the event i.e. the event which entitled the Petitioners to terminate and 12 months after his re-selection that the Petitioners ultimately purported to terminate the PRA. In light of the above facts, the Court observed that there was no merit in the contention that the termination of the PRA was valid or lawful and the finding of the Arbitral Tribunal warranted no interference. The Court reiterated the well-settled position of law that the construction of the terms of the contract fell exclusively in the domain of the Arbitral Tribunal.Next the Court addressed the contention of the Petitioners that the Arbitral Tribunal acted arbitrarily by failing to give the Petitioners the benefit of the consideration received by the Respondent from the KKR Contract (i.e. Indian Premier League Playing Contract) dated August 21, 2008 between Knight Riders Sports Private Limited and the Respondent. The Counsel for the Petitioners had argued that as a personality, the Respondent had received Rs. 13.11 crores and the Respondent owed 20% of the same to the Petitioners. The...

Calcutta High Court Upholds Arbitral Award In Favour Of Sourav Ganguly Over Termination Of Player Representation Agreement

Arpita Pande

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