Report No. 76

8.50. Scope as to infructuous arbitrati.- effect on suits.-

The difficulty, however, arises from the narrow scope of section 37(5). Section 37(5) allows relaxation of limitation only where the award is set aside or the court orders that the arbitration agreement shall "cease to have effect with respect to the difference referred."1 Other cases of infructuous arbitration proceedings2 are not covered by it. A fresh cause of action would not also arise on the termination of arbitration proceedings. Hence, where an arbitration becomes infructuous by reason of circumstances not mentioned in section 37(5), there is no extension of limitation for a suit on the same cause of action.

1. As to orders of the court directing that the agreement shall "cease to have effect", see section 12(2)(b) and section 19.

2. For example of other infructuous arbitration proceedings, see para. 8.56, infra.