Doctirne of Severability or Separability in Arbitration
According to the Separability principle, the invalidity of the underlying agreement will not have an impact on the arbitration clause, likewise the invalidity of the arbitration clause will not rinder the underlying aggrement invalid. The arbitration clause is a part of the underlying contract, they are essentially independent from each other . This is stated as the severability or Separability of the arbitration clause.The arbitration agreement address the settlement of disputes between the parties whereas underlying aggrement creates relationship of obligation between the parties.
Recognition of the Doctrine
Under Article 22(2) of UNCITRAL Arbitration Rules,1976. "An Arbitration clause which forms part of the contract and which provides for arbitration under these rules shall be treated as an agreement independent of the other terms of the contract. A decision by the arbitral tribunal that the contract is null and void shall not entail ipso jure the invalidity of the arbitration clause".Under Article 6 (4) of ICC "Arbitral tribunal shall continue to have jurisdiction to determine the respective rights of the parties and to adjudicate their claims and pleas even though the contract itself may be non existence or null void ."
Purpose of the doctrine of Separability
The parties have the autonomy to entered into an agreement on their own terms and conditions but subject to the public policy of the Country they look to enforce their agreement into only the terms and conditions . The parties enter and agree for arbitration clause, so to avoid courtroom litigation. As it is usually seen that the relations of the parties get worst if the matter goes to court and for businessmen keeping good terms with the other party is more important. But if a party claim non performance of the agreement by the other party , the latter will claim the agreement is invalid , the arbitration clause also becomes unoperative, and thus the matter no more remain arbitral . In such case , the role of Separability and holds importance . Accordingly to this doctrine, that arbitration clause would have to be considered seprate and independent from the underlying contract , and therefore any infirmily in the latter does not ipso jure invalidates the arbitration clause.
Features of the doctrine of Separability
- On the termination of the main contract , the arbitration agreement does not ipso facto or necessarily come to an end
- The arbitration agreement address the settlement of disputes between the parties whereas underlying agreement creates relationships of obligation between the parties.
- The survival of the arbitration agreement depends upon the nature of the dispute and its effect upon the underlying contract.
- The doctrine of Severability will work when the arbitration agreement becomes null and void .There may be facts which are specific to both the main aggrement and the arbitration agreement, In the case Arbitral aggrement would perish with the main aggrement but not the arbitration agreement would not perish with the main control/aggrement.
- If the further performance of the contract has brought to an end the arbitration clause would survive whereas the existence of the contract is itself brought to end the arbitration clause would not survive