Karnataka High Court Overturns Order to Pay Film Production Company in Contract Dispute.
14 June 2024
Arbitration Law >> Business & Commercial Law | Contract Law >> Corporate Law
A Karnataka High Court bench has ruled in favor of the Government of Karnataka in a dispute with a film production company, BBP Studio Virtual Bharat Private Limited. The case involved a contract to produce a 3D film for the "Invest Karnataka 2022: Global Investors Meet."
Background:
BBP Studio was awarded a work order to create the 3D film. The company reportedly completed the project, but later received a communication that the work order was cancelled. Unhappy with this decision, BBP Studio filed a writ petition in the Karnataka High Court. The writ petition challenged the cancellation of the work order and sought payment for the completed film. The Single Judge bench initially ruled in favor of BBP Studio, quashing the cancellation and ordering the government to pay for the work. The Government of Karnataka, represented by Invest Karnataka Forum and Marketing Communication and Advertising Limited, appealed the Single Judge's decision.
Conclusion:
The High Court bench, while hearing the appeal, held that the dispute between the film production company and the government was a contractual matter. The court noted that the contract between the two parties contained an arbitration clause. This clause mandated that any disputes arising from the contract should be settled through arbitration and not through a writ petition. Based on the presence of the arbitration clause, the High Court allowed the appeals filed by the Government of Karnataka. The court set aside the Single Judge's order, effectively dismissing the writ petition. This means BBP Studio will need to pursue its claims for payment and potential reinstatement of the work order through arbitration as per the terms of the contract.