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2011 6 Supreme 151 : The court held that an arbitration clause in a partnership deed must be valid and enforceable for an arbitrator to be appointed under Section 11 of the Arbitration and Conciliation Act, 1996. Specifically, where a dispute is raised and an arbitrator is sought not under a validly executed partnership deed (such as the one dated 12.6.1988), but under another alleged deed (such as the one dated 19.5.2000), the party filing the application must first establish that there is a valid arbitration clause in the contract dated 19.5.2000. The existence of a valid and enforceable arbitration agreement is a condition precedent before an arbitrator can be appointed. Therefore, if the arbitration agreement is denied by the respondent and serious allegations of forgery or fabrication are made, the Chief Justice or his designate must decide whether such an agreement exists before appointing an arbitrator—this issue cannot be left to the arbitrator.Checking relevance for Jagdish Chander VS Ramesh Chander...
2007 3 Supreme 874 : A clause in a partnership deed stating that disputes shall be referred to arbitration ''''if the parties so determine'''' cannot be construed as an arbitration agreement because it lacks the essential element of consensus ad idem to refer disputes to arbitration. The use of the word ''''determine'''' indicates that the parties must mutually decide after due consideration, meaning arbitration is not automatic and requires fresh consent. Therefore, such a clause does not establish a clear intention to arbitrate and fails to meet the requirements of an arbitration agreement under Section 7 of the Arbitration and Conciliation Act, 1996.Checking relevance for Rahul Verma VS Rampat Lal Verma...
2025 2 Supreme 764 : The arbitration clause in a partnership deed is binding on the legal heirs of a deceased partner, even if they are non-signatories, because the existence of an arbitration agreement is not affected by the death of a party. The term ''''partners'''' in the partnership deed extends to include their legal heirs, representatives, assigns, or legatees. The right to sue for rendition of accounts survives to legal heirs, entitling them to invoke the arbitration clause. Section 40 of the Arbitration and Conciliation Act, 1996, ensures that an arbitration agreement remains enforceable by or against the legal representatives of a deceased party, and the arbitration clause can be invoked by the legal heirs of a deceased partner, particularly where the dispute arose during the lifetime of the deceased partner.Checking relevance for Babanrao Rajaram Pund VS Samarth Builders & Developers...
2023 2 Supreme 221 : The legal documents confirm that a clear intention to arbitrate can be established in a partnership deed even if the clause does not use specific formal language, provided there is an unambiguous intention of the parties to refer disputes to arbitration. In this case, Clause 18 of the Development Agreement—though not a partnership deed—was held valid because it used terms like ''''Arbitration'''' and ''''Arbitrator(s)'''', mandated reference to arbitration with the phrase ''''shall be referred to arbitration'''', specified the method of appointing arbitrators (mutual appointment of a Sole Arbitrator, failing which two arbitrators appointed by each party, and a third by them), and chose the governing law as the Arbitration and Conciliation Act, 1996. These elements collectively demonstrated a clear and binding intention to arbitrate. The court emphasized that courts must focus on the substance and evident intent of the parties rather than technical deficiencies, and that mere possibility of arbitration is insufficient—there must be an obligation to refer disputes to arbitration. This principle applies equally to partnership deeds: if the clause clearly indicates the parties’ intention to resolve disputes through arbitration, it constitutes a valid arbitration agreement.Checking relevance for Aziz VS Protapaditya Debnath...
2023 0 Supreme(Cal) 1024 : An arbitration clause in a partnership deed is valid and enforceable even if the partnership is unregistered, and the dispute pertaining to such partnership can be referred to arbitration. The clause must be clear and unambiguous, and when the partners have agreed to settle disputes through arbitration, it is not open to a party to contend that the partnership being unregistered prevents referral to arbitration. The court found that the arbitration clause in the partnership deed was clear and unequivocal, expressly providing that all disputes between the partners or their legal representatives regarding the interpretation of the deed, rights and liabilities, or any matter touching partnership affairs shall be referred to arbitration, and the decision of the arbitrators shall be final and binding.
