2023ArbitrationJuly 2023

A clause in the Will for settlement of disputes between heirs does not constitute

Judgment dated 27.6.2023 of the High Court of Bombay - arbitration agreement - A clause in the Will for settlement of disputes between heirs does not constitute

Brief facts of the case and the context that a “Will” does not constitute “arbitration agreement” for information –

Maganlal – executor of the Will dated 2.7.2016 – died leaving behind his heirs – applicant and the respondent.  The applicant, who was appointed as the Sole Executor and Trustee of the estate, had applied for probate.  The respondent affirmed the affidavit to grant of probate and accordingly, the High Court granted probate on 26.3.2018.

In the meanwhile, the applicant and the respondent entered into three agreements. In the Deed of Family Understanding dated 2.12.2017, clause 19 of the Will was incorporated making arbitration reference mandatory.

Since there were disputes and they were not resolved amicably, the applicant invoked Clause 19 of arbitration in the Well by the notice dated 21.12.2020 and filed application for appointment of Arbitrator.

HELD, on consideration of clause 19 of Will, a testamentary document, did not have the consent either of the applicant or the respondent.  They are not signatories to the same.  The Will had only bestowed certain rights on the parties.  In the absence of “agreement” between the parties on “arbitration”, the clause 19 of the Will cannot be treated as “arbitration agreement”. Thus, a Will or any of its clauses, cannot be “arbitration agreement”.

Ashwin Maganlal Savani Vs. Himadri Davda – Commercial Arbitration Application (L) No.9910 of 2021.

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