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Contents
• 1. INTRODUCTION
• 2. JUSTIFICATION
• 3. THE COMPETENCE–COMPETENCE RELATIONSHIP
•
https://www.kluwerarbitration.com/document/kli-ka-ai-2018-03-003?q=formation AND validity AND arbitration agreement 1/46
28.12.21, 13:00 Kluwer Law International - Document
4. CONFLUENCE AND CONFLICT IN THE DEVELOPMENT OF THE

DOCTRINE
• 5. ILLEGALITY AND CONSENT

•Document
6 AN OVERREACHING DOCTRINE
information
Author
Ronán Feehily (/search?authorfullnamereversed=Feehily, Ronán)
Publication
Arbitration International (/journal?title=Arbitration International)
Bibliographic reference
Ronán Feehily, 'Separability in international commercial arbitration; confluence,
conflict and the appropriate limitations in the development and application of
Claims that an arbitral

tribunal failed to deal
What does it with an issue: the
mean to be setting aside of awards
'pro- Table of Contents under the Arbitration
arbitration'? (/journal? Act 1996 and the
(/document/kli- title=Arbitration+International) UNCITRAL Model Law on
ka-ai-2018-03- International
002) Commercial Arbitration
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2018-03-004)
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Separability in international commercial arbitration;

confluence, conflict and the appropriate limitations
in the development and application of the doctrine
Arbitration International (Park (ed.); Sep 2018)
Ronán Feehily
(*)
ABSTRACT
The doctrine of separability in international commercial arbitration

recognizes that an arbitration clause in a main contract is presumptively a
separate and autonomous agreement. The extent to which the doctrine has
developed varies and depends upon the legislative and more pertinently,
the judicial approach in the relevant jurisdiction. This article begins with an
overview of the justifications for the development of the doctrine and a
discussion of competence–competence, the distinct but associated doctrine
that provides the arbitral tribunal with the power to decide upon its own
authority. It subsequently analysis the development of the separability
doctrine, including the consistency and divergence with which the doctrine
has developed and been applied by the courts in various jurisdictions, most
notably England and the USA. The critical issues of illegality and consent,
the appropriate exceptions to or limitations on the doctrine, the
P 355
overreaching nature and potential negative impact of the doctrine are
P 356
analysed, reviewed, and discussed. The article ultimately provides a number
of recommendations to assist in ensuring that parties receive the
appropriate assistance provided by the doctrine and that arbitral tribunals
possess the necessary powers that the parties and their advisors intended.
1. INTRODUCTION
Almost every arbitration is based upon an agreement to arbitrate. (1)
Comprised within an arbitration clause in a main contract (2) or in a
separate document, (3) it reflects the parties' consent and consequent
obligation to arbitrate their disputes. (4) While the jurisdiction of the courts
P 356 emanates from statute or a choice of court agreement, (5) the arbitration
P 357 tribunal's jurisdiction and the arbitrator's power stems primarily from the
arbitration agreement . (6) The widespread adoption of arbitration for the
purposes of dispute settlement has resulted in the development of its
scope and application. (7) The doctrine of separability, also known as the
principle of autonomy (8) or independence of the arbitration clause from
the parties' underlying contract, (9) consequently evolved (10) and
represents a critical element of contemporary international arbitration. (11)
The concept recognizes that an arbitration clause in a main or matrix
contract is presumed to be a separate and autonomous agreement,
reflecting contractual commitments that are independent and distinct from
the matrix contract. (12) The doctrine has been seen as a means to promote
arbitration, (13) has been widely embraced (14) and accepted in

numerous jurisdictions around the world (15) as diverse as Canada, (16)

Azerbaijan, (17) Philippines, (18) Jordan, (19) China, (20) Argentina, (21) Egypt,
(22) and India. (23)
The second part of this article provides an overview of the justifications for
P 357 the development of the doctrine. This is followed in the third part by a
P 358 discussion of competence–competence, the distinct but associated doctrine
that provides the arbitral tribunal with the power to decide upon its own
authority. Part four provides a comprehensive analysis of the development
of the separability doctrine, including the consistency and divergence with
which the doctrine has developed and been applied by the courts in various
jurisdictions, most notably England and the USA. The fifth part deals with
the critical issues of illegality and consent, and the appropriate exceptions
to or limitations on the doctrine. In the penultimate part, the doctrine is
critiqued and the overreaching nature and potential negative impact of the
doctrine is reviewed and discussed. This part concludes with a number of
recommendations that would assist in ensuring that arbitral tribunals
possess the appropriate powers that the parties intended. The final part
draws the previous parts together into a reflective conclusion.
2. JUSTIFICATION
The separability doctrine has been justified on numerous grounds. It is
predicated on the assumption that parties entering into an arbitration
agreement usually intend that all disputes are to be arbitrated, including
disputes relating to the validity of the matrix contract. This is now
established as an implied term of the contract. (24)
Some commentators have divided the main contract into two separate
contracts, with one dealing with the commercial commitments and the
other providing that the parties agree to submit their disputes emanating
from their commercial commitments to arbitration. (25) For example, in
Black Clawson International Ltd v Papierwerke Waldhof-Aschaffenburg AG
(26) the House of Lords held that the arbitration clause and the main
contract comprise two separate sets of contractual relations. Hence, in the
event of the main contract being deemed invalid, the arbitration clause
P 358
remains valid and binding due to its independent and separate nature. (27)
P 359
However, as both agreements (28) are included in one document signed by
the parties, the separability doctrine has been characterized as solely a
legal concept and not a factual determination. (29) As there is no
requirement on the parties to separately consent to the arbitration
agreement ; by signing the matrix contract their consent to the arbitration
agreement is implied. (30) Hence the parties are providing their consent

to two separate agreements; the matrix agreement comprising their

substantive obligations and the arbitration agreement dealing with the
resolution of disputes arising out of the matrix contract. (31) This legal
fiction, that the parties are consenting to two separate agreements,
provides no reason to treat an agreement to arbitrate disputes in the form
of a clause in a different way. (32) International arbitral jurisprudence has
established for some time that courts will review arbitral awards, but will
generally not review the merits of disputes that are meant to be arbitrated,
as it is well established that the arbitration clause is separate from the
matrix contract. (33) For example, Lord Diplock stated in Bremer Vulkan
Schiffbau und Maschinenfabrik v South India Shipping Corporation Ltd (34)
that an arbitration clause is a self- contained contract collateral or ancillary
to the matrix contract. This approach was followed in Elf Aquitaine Iran
(France) v National Iranian Oil Company, (35) in which the French courts
P 359 confirmed over three decades ago that the doctrine of separability was a
P 360 recognized principle of international arbitration law.
Laws pertaining to arbitration have for some time provided that parties can
contract out of litigation in court in favour of arbitration. This
acknowledgement of party autonomy is reflected in both international laws
on arbitration and international laws on freedom of contract. An example
can be found in Article 1.1 of the UNIDROIT Principles on the Freedom of
Contract, which provides that parties are free to enter into a contract and
determine its content. (36) Article 1.3 sets out that a contract cannot be
modified or terminated outside the scope of agreement set out in the
contract, and consequently cannot be modified or terminated by a court.
(37) Such provisions confirm the principle of party autonomy and ensure the
enforcement of agreements providing that arbitration will be the main form
of dispute resolution. (38) It would certainly circumvent the intention of the
parties and the rationale for choosing arbitration, if an arbitration clause
was adversely affected by the invalidity of some other clause in the
agreement. (39)
3. THE COMPETENCE–COMPETENCE RELATIONSHIP

The 'Competence–Competence' or 'Kompetenz–Kompetenz' principle (40)
empowers an arbitral tribunal with the authority to independently
determine issues where its jurisdiction is questioned, without reverting to a
court. (41) As discussed above, the doctrine of separability results in an
arbitration clause being independent of other contractual terms and as a
P 360 result where an arbitral tribunal determines that a contract is invalid, this
P 361 decision will not, by operation of law, result in the end of the arbitration
clause. (42) The separable and autonomous nature of the arbitration clause

recognizes the presumed intention of the parties that the arbitrator should
have the power to determine the validity or survival of the matrix
contract, otherwise the arbitrator's power could be diminished at the
relevant time when assessing essential aspects of the disputing parties'
business relationship. (43) Predicated on the assumption that commercial
parties intend that all disputes are submitted to arbitration, the application
of the principle of competence–competence is a means of avoiding the
splitting of proceedings and is perceived as more effective for the
parties. (44) The result of both principles precludes parties evading arbitral
proceedings and enhances the efficiency of the process. (45) Both principles
also have the shared function of creating mechanisms that prevent bad
faith by a party from inhibiting arbitral proceedings before they have
commenced. (46)
Albeit that the two principles intersect functionally and arise from shared
objectives, they are distinct. The competence–competence doctrine is not
dependent upon the seperability principle and similarly the separability
principle could be accepted without also adopting a rule of competence–
competence. However, there are material relationships between the two
principles. (47) While the two principles are designed to interact to create
P 361 presumptions that enhance the effective operation of the arbitral process,
P 362 this interaction has given rise to confusion about the arbitrators' right to
rule on his or her jurisdiction. (48) The separate and autonomous nature of
the arbitration clause operates with regard to the defects in the matrix
contract that could otherwise taint the jurisdiction of the arbitrator, while
the doctrine of competence–competence gives the arbitrator the right to
determine issues including alleged defects in the arbitration clause itself.
Hence the two related but distinct doctrines intersect only in the sense that
arbitrators who rule on their own jurisdiction will look only to the
arbitration clause and not to the entire matrix contract. (49) Due to the fact
that the jurisdiction of the arbitral tribunal is not affected where a party
challenges the validity of the matrix contract, (50) the doctrine of
separability sets the groundwork for the jurisdiction of an arbitral tribunal
to decide issues concerning its own jurisdiction, and consequently interacts
in an important way with the competence–competence doctrine. (51) For
example, separability facilitates arbitrators to find a matrix contract invalid
in a context where the contract is predicated on bribery and therefor illegal,
without destroying the arbitrators' power to issue an award pursuant to the
arbitration clause. However, the separability doctrine would not make the
arbitration agreement itself valid if the person who signed the matrix
contract did not possess the requisite authority to do so. Competence–
competence principles in turn facilitate the arbitrators to examine the
authority of the person who signed the contract, albeit that this could be
the subject of a subsequent court challenge. (52) Under competence–

competence principles in isolation, without the distinct but related doctrine
P 362
of separability, the arbitrators could not determine that the matrix contract
P 363
was void due to illegality without also undermining their own jurisdiction to
do so. (53)
International and Institutional rules of arbitration usually elucidate the

power of an arbitral tribunal to decide upon its own jurisdiction, and
support for the principal has not always been universal. (54) In order to
determine an arbitrator's power in a given jurisdiction, it is important to
assess whether, and the extent to which both elements, separability and
competence–competence are reflected in its national law. In England for
example, competence–competence is contained in section 30 of the
Arbitration Act 1996, while separability is comprised in section 7. The English
courts have confirmed, consistent with the statutory provisions mentioned,
that separability insulates the arbitration agreement from the underlying
contract, while competence–competence reflects the separability doctrine
but maintains the requirement that the arbitration agreement should be
valid and binding. (55)
Both competence–competence and separability enhance the efficiency of

the arbitral process and without both doctrines, contemporary arbitration
would not be as effective as a process of dispute resolution. (56) Unlike the
separate provisions dealing with each of the two doctrines under the
P 363
P 364
English Arbitration Act discussed above, some instruments such as the
UNCITRAL Rules, (57) the UNCITRAL Model Law, (58) the LCIA Rules, (59) and
the ICC Rules (60) reflect the doctrine of competence–competence and the
doctrine of separability in a single provision. (61)
4. CONFLUENCE AND CONFLICT IN THE DEVELOPMENT OF THE

DOCTRINE
The primary consequence of the separability doctrine is that the non-
existence, invalidity, illegality (62) or termination of the main contract need
not necessarily negate the agreement to arbitrate comprised within it.
Hence, as noted above, an arbitration clause may survive regardless of the
termination of the matrix contract. (63) The arbitral tribunal will consider
challenges to the matrix contract and render a binding award declaring that
the matrix contract is invalid, based on its own jurisdiction stemming from
the separable arbitration clause. (64) Although differences exist in its
application, (65) this aspect of the separability doctrine is reflected in
international arbitration conventions, national legislation, judicial
decisions, institutional arbitration rules, and arbitral awards. (66) However,
these instruments and authorities also acknowledge that there may be
circumstances where an agreement to arbitrate disputes is not completely

separate or independent from the matrix contract within which it is
comprised, and that there can be circumstances in which the validity of
the matrix contract will have an impact upon the status of the arbitration
agreement . (67) This is due to the fact that an arbitration agreement is
essentially a procedural contract that provides a dispute resolution
mechanism for a specific category of disputes that may arise under the
matrix contract. (68)
While the New York Convention impliedly requires contracting states to give
P 364 effect to the parties' agreement to treat their arbitration clause as
P 365 separable, (69) the European Convention on International Commercial
Arbitration (70) clearly acknowledges that the arbitration agreement is
separable from the matrix contract. (71) Under the UNCITRAL Model Law on
International Commercial Arbitration, (72) Article 16(1), an arbitration clause
in a contract is required to be treated as an agreement independent of the
other contractual terms for certain competence–competence purposes, and
provides that a finding that the matrix contract is invalid, does not
automatically invalidate the associated arbitration clause. (73) Hence the
separability of arbitration agreements is well settled and expressly
protected by national arbitration statutes and established jurisprudence.
(74)
The question of whether the validity of an arbitration clause is separate

to that of an underlying contract in cases of termination or illegality is the
most controversial issue relating to the principle of separability. (75)
Termination and illegality constitute two different stages of progressive
acceptance of the doctrine. (76) There are numerous grounds under contract
law providing for a contract to be repudiated in appropriate circumstances,
for example, it may be unenforceable due to frustration, or due to being
concluded under duress, fraud or any other anomaly contrary to contract
law. (77) Parties who have agreed to arbitrate their disputes may
subsequently attempt to frustrate arbitral proceedings through defences
such as termination of the contract through rescission due to a pre-
P 365 contractual misrepresentation or a material breach of the contractual
P 366 terms. This would result in all of the contractual terms and conditions,
including the arbitration clause being rendered unenforceable. The doctrine
of separability allows an arbitration agreement to survive even where the
main contract is repudiated, breached, terminated or deemed void ab initio.
(78) The extent to which this intervention is willing to reach varies and
depends upon the legislative and more pertinently, the judicial approach in
the relevant jurisdiction. (79)

The Federal Arbitration Act 1925 (80) of the USA, sections 2, 3, and 4
impliedly recognize the principle of separability. In both international and
domestic jurisprudence, the courts in the USA have supported the
doctrine of separability. (81) The approach adopted in the USA to the
principle of separability in cases of illegality is similar to the approach in
England discussed below. (82) Medina J, stated in the Court of Appeal's case
Robert Lawrence Co Inc v Devonshire Fabrics Inc, (83) that due to the
principle of seperability, breach, repudiation, and illegality of the matrix
agreement does not have any adverse effect on the arbitration clause. (84)
Following Robert Lawrence, two of the most seminal US decisions in support

of the separability doctrine are Prima Paint Corp v Flood (85) and Buckeye
Check Cashing Inc v Cardegna. (86) In Prima Paint, the Supreme Court held
that arbitration clauses are deemed to be separable from the contracts in
P 366 which they are comprised, unless the parties express a contrary intention.
P 367 The case involved claims of fraudulent inducement relating to the matrix
contract that could render it voidable. Fortas J confirmed that the allegation
of fraudulent inducement was arbitrable under a broad arbitration clause
provided the allegation had nothing to do with the arbitration clause itself.
(87) He stated that the only way the arbitration clause would not be
separable from the main contract is if the parties required that it not be.
(88)
The Supreme Court followed the separability approach in Buckeye. The case
involved the illegality of a usurious loan agreement, in which a Florida
decision had held that the illegality rendered both the matrix agreement
and the arbitration clause comprised within it void ab initio in accordance
with Florida law. The Supreme Court confirmed that even if state or foreign
law prescribed a particular contract as invalid, illegal, void, voidable, or void
ab initio, the separability presumption was a substantive rule of federal law,
enshrined in the Federal Arbitration Act. The court distinguished between
challenges focused on the arbitration agreement and challenges directed
at the contract as a whole. It held that challenges against the arbitration
agreement would be subject to interlocutory judicial resolution and
P 367 challenges against the contract as a whole would be referred to arbitration.
P 368 However, cases involving concerns over whether consent was provided, for
example where there are valid concerns as to whether a party had capacity
or authority when signing the contract were identified as exceptions. The
ruling in Buckeye also played an important role in the endorsement of the
doctrine of separability in the USA as it confirmed that the doctrine applies
in both federal and state courts. (89)

More recently, in Rent-A-Center West Inc v Jackson, (90) a case arising from
an employment relationship, the Supreme Court viewed an arbitration
agreement as a main contract and the clause comprised within it that
provided for the resolution of jurisdictional disputes by the arbitrator as a
mini-arbitration agreement that it held was severable from the general
arbitration agreement . While the three US Supreme Court decisions in
support of the seperability principle demonstrate a consistent approach to
the doctrine, it remains to be seen how the court will determine a dispute
where the challenge is directed at the agreement to arbitrate rather than
the matrix contract. (91)
English courts originally did not consider the separate nature of an

arbitration clause, based on the rationale that if the main contract was
rendered void, the arbitration clause was deemed also to be void. (92)
Hence it was believed that if the matrix contract was void ab initio, for
whatever given reasons, then the arbitration clause could not be saved. (93)
This was expressed by the maxim 'ex nihilo nil fit' meaning nothing comes
out of nothing. (94) This can be seen in decisions such as Hirji Mulji v
P 368 Cheong Yue Steamship Co Ltd, (95) where the court ruled that when an
P 369 agreement is frustrated, the arbitration clause fails as well. A similarly
restrictive approach was adopted in Joe Lee Ltd v Lord Dalmeny, (96) where
the court held that arbitrators do not have the authority to arbitrate
disputes involving illegal gambling contracts.
However, in Heyman v Darwins Ltd (97) the effect of a frustrated matrix

contract on the arbitration clause comprised within it was revisited. The
main issue in the case was whether discharge of the matrix contract due to
repudiatory breach also discharged the arbitration clause comprised within
it. The House of Lords declined to follow the decision in Hirji Mulji v Cheong
Yue Steamship Co Ltd (98) and determined that the discharge of the
matrix contract as a result of repudiatory breach did not affect the
arbitration clause. (99)
Despite some disparities, English courts have generally accepted the

doctrine of separability. (100) The doctrine was established in English
common law (101) in Heyman v Darwins, as noted above, and later in
Harbour Assurance v Kansa General International Insurance. (102) In Harbour
Assurance, the Court of Appeal held that the parties' arbitration clause was
separate from the underlying reinsurance contract. Consequently, the initial
illegality of the main contract did not necessarily affect the arbitration
clause. The court identified possible instances when the invalidity affecting
the matrix contract will also affect the arbitration clause, such as instances
involving forgery, (103) where it is denied that any agreement was
concluded between the parties or mistake as to the identity of a contracting
P 369 party. (104) The House of Lords also confirmed that regardless of the fate of
P 370 the matrix contract, the arbitration clause was autonomous. Assistance is
provided when interpreting the contract by the presumption that a single
entity (105) should determine all disputes rather than the intervention of
both the arbitral tribunal and the court. (106) This approach was adopted
and expanded in section 7 of the Arbitration Act 1996, mentioned previously,
which provides that the arbitration agreement is not automatically
invalid, non-existent or ineffective due to the matrix contract being so
determined.
Fiona Trust Holding Corp and others v Privalov and others (107) represents
the most expansive view of the doctrine of seperability adopted to date by
the English Court of Appeal and the House of Lords. With an emphasis on
the likely intention of a rational businessman and the commercial purpose
of the agreement to arbitrate, (108) a presumption in favour of 'a one-stop
method of adjudication' was adopted. A rebuttal to this presumption could
only be established by clear words indicating an intention to the
contrary. (109) The House of Lords applied the principle of seperability,
concluding that an agreement to arbitrate could only be invalidated on a
basis relating specifically to the arbitration agreement itself and not due
to the invalidity of the matrix contract. (110) In applying the exacting test of
direct impeachment, the court concluded that allegations that the matrix
contract was obtained by fraud or bribery and as a result deemed void, did
not negate the arbitration agreement . Consequently the arbitral tribunal
had jurisdiction over the dispute. (111) Following the rationale adopted in
Buckeye, (112) the House of Lords considered some of the instances where
challenges to the matrix contract would impeach the validity of the
arbitration agreement . They gave as an example the case where the main
contract and the arbitration agreement are comprised within the same
document and one of the parties contends that they never consented to the
contents of the document and that their signature was forged. (113)
P 370 As can be seen from the above analysis, in England the issue of the
P 371
invalidity of the arbitration agreement has featured in numerous cases
where the courts had to review circumstances where contracts were alleged
to be void due to illegality. In making the determination as to whether the
specific form of illegality resulted in both the main contract and the
arbitration agreement being void, the courts have reviewed the purpose
and policy of the rule of illegality in order to determine whether this would
be defeated by allowing the disputed issue to be arbitrated. (114) In
Soleimany v Soleimany, (115) it was noted by Waller LJ that there may be
instances where illegal or immoral dealings are involved and cannot be
arbitrated under English law, as the agreement to arbitrate will itself be

contrary to public policy or illegal. However, in that case, the arbitration

agreement was deemed to be valid despite the fact that the award
upholding the contract was deemed illegal and could not consequently be
enforced. Another similar example is the more recent case of Beijing
Jianlong Heavy Industry Group v Golden Ocean Group Ltd, (116) in which
English courts confirmed that they will enforce an arbitration agreement
where the matrix contract is deemed unenforceable and in cases where
there is a public policy rule resulting in the main contract being deemed
void and illegal. The court reinforced the strength of 'powerful commercial
factors' which weighed in favour of upholding an agreement to arbitrate.
The decision illustrates the willingness of the English High Court to enforce
an arbitration agreement even in circumstances where a public policy
rule results in the matrix contract being deemed illegal. (117)
As can be seen from the above discussion, international arbitral tribunals

apply separability in cases where the main contract is allegedly terminated
P 371
and also in cases where the main contract is allegedly non-existent or
P 372
invalid. (118) The jurisdiction of arbitral tribunals has expanded over time
and the courts have been increasingly willing to facilitate the jurisdictional
expansion of arbitral tribunals to determine claims of illegality, including
corruption and bribery. Consequently, the prevailing view is that arbitral
tribunals can assume jurisdiction in alleged bribery cases, and the fact that
a dispute involves claims of criminal conduct does not mean that it cannot
be arbitrated. (119) Allegations of corruption that relate to the matrix
contract, do not adversely affect the arbitration agreement , provided they
do not relate to the arbitration agreement itself. As discussed above, the
doctrine of competence–competence enhances this approach by providing
the arbitral tribunal with the authority to determine whether it possesses
jurisdiction in such cases. Provided fraud, duress, threats, or other illegal
means do not taint the arbitration agreement , the doctrine of separability
creates the assumption that an arbitral tribunal possesses the necessary
jurisdiction to determine the illegality of the matrix contract. Indeed, the
focus has moved from right to obligation, as arbitrators now appear to have
a duty to actively address illegality issues during arbitral proceedings as
they are in the best position to determine if contracts are invalid due to
bonos mores or violations of international public policy. (120)
The autonomy and independence of the arbitration agreement is long

established in civil law countries also. In France for example, the
separability principle is codified in Article 1447 of the revised French Code of
Civil Procedure and French courts have adopted the doctrine in the way it is
most widely understood internationally. (121) Similar to courts in other
jurisdictions, French courts have held the arbitration agreement to be

valid despite the matrix contract being discharged, repudiated, illegal or

declared void. (122) Consistent with the position in England and the USA,
French courts have held that the validity or legality of the matrix contract,
in contrast to challenges directed at the existence of the matrix contract, do
not generally negatively impact the arbitration clause comprised within the
P 372 agreement. (123) Numerous other civil law European countries including
P 373 Sweden, the Netherlands, France, Belgium and Switzerland (124) endorse
the separability principle and an arbitrator's power to determine if a

contract is void ab initio. (125)
The doctrine was not initially embraced in Australia with the same alacrity
as was experienced in the USA, England and the other jurisdictions
mentioned above. Since 1989, with the adoption of the UNCITRAL Model Law
on International Commercial Arbitration in the International Arbitration Act
1974, Australia has ostensibly been in line with international commercial
arbitration practices. (126) However, High Court decisions relating to
arbitration, such as Government Insurance Office (New South Wales) v
Atkinson-Leighton Joint Venture (127) and Tanner Research Laboratories Inv v
O'Brien (128) , revealed limited directions on the principle of separability
and construction of arbitration clauses. (129)
Similar to English courts, Australian Courts were initially reluctant to

embrace the doctrine of separability, and this was demonstrated in cases
such as QH Tours Limited v Ship Design & Management (Australia) Pty
Limited (130) and IBM Australia Ltd v National Distribution Services Ltd.
(131) In IBM Australia Ltd v National Distribution Services Ltd, Clarke JA in his
obiter (132) remarks was adamantly against Australian courts adopting the
principle of separability. This approach was understandably criticized as it
ignored the increasing global adoption of the principle of separability and
was inconsistent with the International Arbitration Act 1974 and
international arbitration practice. (133)
There was initially a divergence in approach between state and federal
courts. While the New South Wales courts supported arbitration, the Federal
Court was not traditionally very supportive of international arbitration. (134)
Over two decades ago the courts of New South Wales endorsed the
principle in cases such as Ferris v Plaister. (135) Conversely, in Raguz v
Sullivan, (136) it was stated that Australian Courts were hostile to
international arbitration. (137) However, six years later, a sea change in
approach and attitude was adopted. In Comandate Marine Corp v Pan
Australia Shipping Pty Ltd (138) the full federal court acknowledged that
Australian law had to support international commercial arbitration
P 373 practices, as Australia was very much engaged in international trade and
P 374 commerce. (139) This followed the Federal Court's decision in Walter Rau

Neusser Oel und Fett AG v Cross Pacific Trading Ltd, (140) where it confirmed
that the principle of separability was binding law. Despite the principle of
separability initially gaining little support from Australian Federal Courts,
(141) the initial reluctance has subsided and the principle of separability is
now applied at both state and federal levels.
There are significant similarities in approach between Australian and

English courts when dealing with the issue of arbitral separability. This is
demonstrated when reviewing the consistency in reasoning in Comandate
and Fiona Trust. One of the main criticisms of the separability principle, the
'legal fiction' (142) referred to in Comandate, and the 'conceptual obstacles'
(143) as stated by Lord Hoffman in Fiona Trust was rejected in both
Comandate and Fiona Trust. Similarly, the commercial rationale of practical
business minded people in facilitating the efficient settlement of
commercial conflict by arbitral tribunals favours the adoption of the
doctrine of seperability, according to both Clarke JA in Ferris v Plaister and
Lord Hoffman in Fiona Trust. (144)
However, despite the consistency discussed above, there is divergence

between the English and Australian separability approach. Australian law
lacks the clarity that English law provides with its full endorsement of the
doctrine and its explicit explanations of the principle. For example,
Australian law fails to provide a test with regard to the limitations of the
doctrine. It is to be hoped that the Australian High Court will provide a
P 374 fulsome understanding of the principle and its limitations, as the House of
P 375 Lords did in Fiona Trust, when determining separability cases in future in
order to rectify the discrepancies that exist in Australian common law and
ensure that the approach adopted by Australian courts and the consequent
Australian jurisprudence is consistent with international arbitration
practice. (145)
5. ILLEGALITY AND CONSENT

As noted above, a defect in the matrix contract can undermine the validity
of an arbitration agreement and the doctrine of separability immunizes
the arbitration clause, protecting it from flaws or defects in the matrix
contract. (146) An example of a valid challenge to the arbitration agreement
is where it is proved by a party that the signature on the matrix contract
was forged. In accordance with the doctrine of separability, a challenge
would have to be focused on the separate arbitration agreement that was
elicited by forgery, albeit that the signature was on the matrix contract. As
direct impeachment of the arbitration agreement is required by the
doctrine of separability before it can be discharged, allegations regarding
the validity of the matrix contract will be insufficient to end the
arbitration agreement . (147) While allegations of non-existence do not

invalidate the arbitration and the arbitral tribunal can assume jurisdiction,
(148) as discussed in greater detail below, the doctrine of separability is less
likely to be applied where there is a challenge to the very existence of an
agreement. (149)
In instances where the parties lack capacity or where the main contract is
illegal, it was traditionally viewed as doubtful whether the arbitral
agreement can still remain valid, especially in view of the fact that the
arbitral agreement is made pursuant to the main contract. (150) Gibson LJ in
Harbour Assurance, remarked that the question of whether the illegality of
the matrix contract affected the legal status of the arbitration agreement
is contingent upon the nature of the illegality. (151) There are some
instances where both the main contract and arbitration agreement are
deemed illegal and void. (152) Examples include instances where the
signature on the contract was forged, where there was a forced signature,
where the signatory is a minor, or cases of non est factum, where the party
was deceived or mistaken about the character of the contract. (153) As
P 375
noted above, the court in Buckeye stated that its decision cannot be
P 376 extended to cases that challenge the formation of a contract, nor the
authority or mental capacity of a party to that contract. (154) The common
theme among all of these scenarios is that the signatory did not provide
their contractual consent, with the result that there is no agreement to the
main contract or the arbitration agreement . (155) In Buckeye, there was no
deception, the parties freely consented to the contract and there were no
concerns about the authenticity of their signatures. The conflict of the
content of the main contract with state law resulted in the contract being
void there was no issue with the parties' consent.
The lack of consent in the scenarios discussed above results in both the
main contract and arbitration agreement being void ab initio. Cases that
address a lack of consent have been characterized as exceptions to the
separability rule. A distinction can be drawn between illegality cases that
challenge the contract substance, and assent cases, that challenge contract
formation . In the context of this distinction, it follows that the separability
doctrine applies only to illegality cases and not to assent cases, as the
parties' consent to both the arbitration agreement and the main contract
is uncertain. (156) This approach could be viewed as inconsistent with the
general severability principle and that consideration of the arbitration
agreement should be distinct from the consideration of the validity of a
contract. However, the approach of viewing assent cases as an exception to
P 376
the separability principle may be viewed as consistent with contract law
P 377
principles as well as other decisions of separability of arbitration clauses

from the matrix contract. Separability jurisprudence rests on the fact that
contracts could become invalidated by factors that are discovered after the
contract was entered into. This is different from the issue of whether the
contract was valid to begin with. There is a well-established distinction in
contract law between void contracts or contracts void ab initio that were
not valid in the first instance and are consequently legally unenforceable,
and voidable contracts that are considered to be contracts that were
entered into but that can be nullified by a subsequent event.
Misrepresentation for example, which was the basis of the voidability of the
contract in Fiona Trust, results in contracts being voidable. By contrast, the
fact that a contract does not possess the required contractual conditions
means it was void in the first place and no contract ever existed. (157)
It could be contended that instances concerning consent are not exceptions

to the separability rule, on the basis that the rule merely prevents the
illegality of the main contract from automatically contaminating the
arbitration agreement . It follows that both agreements can be tainted by
the same defects, as both agreements can be declared void for the same
reasons. (158) Similarly, the invalidity of an arbitration agreement could
be viewed as resulting, not from the invalidity of the main contract, but due
to the invalidity of the arbitration agreement itself. (159) An example is
where a signature on a contract is forged, the contract would be deemed
void ab initio. The void nature of the matrix contract does not mean that
the arbitration agreement is automatically void. However, as both
P 377
agreements share one signature, the signature to the arbitration agreement
P 378 is also forged and the arbitration agreement is also void ab initio.
While both agreements share one consent, linking the validity of the
matrix contract and the arbitration agreement , the invalidity of the main
contract does not automatically invalidate the arbitration agreement as
both must be reviewed independently to determine their validity . Hence,
the fact that both the matrix contract and the arbitration agreement are
invalidated for the same reason need not be viewed as conflicting with the
separability doctrine. (160)
It follows that the doctrine merely prevents the validity of the arbitration
agreement being dependent on the validity of the matrix contract.
Therefore, it could be suggested that the courts in such circumstances do
not create an exception to the separability doctrine, but rule in conformity
with it. Hence the doctrine of separability need not be viewed as directly
rendering arbitration agreements valid and effective; rather the doctrine
immunizes arbitration agreements from the invalidity of the matrix
contract. One could contend that rather than viewing the court's decisions
in such circumstances as not extending separability to the arbitration

agreement in question, due to the party's lack of consent, the arbitration

agreement was invalid, notwithstanding the fact that it was separate from
the matrix contract which was also invalid for the same reason. While the
arbitration agreement and the matrix contract can be affected by the
same illegality, it is suggested that they should be examined independently.
The focus should simply be on the nonexistence of the agreement to
arbitrate itself. (161)
The issue of lack of consent is exemplified by the case Spahr v Secco. (162)
The case which came before Tenth Circuit Federal Court of Appeals in the
USA, involved the validity of a contract and arbitration agreement
comprised within it signed by Spahr, who suffered from Alzheimer's disease
and dementia. (163) The court held that such a mental incapacity affects
both the main contract and the arbitration agreement and both were held
P 378
to be void. (164) As noted above, mental incapacity is one of the instances
P 379 involving lack of consent, and therefore affects the main contract and the
arbitration agreement . The Court was unwilling to extend the legal fiction
of separability to circumstances where there was a contract formation
challenge based on mental incapacity. (165)
It has been suggested that the reasoning in Spahr v Secco reveals that the
court viewed the issue of lack of consent as an exception to the separability
doctrine. (166) The doctrine, as set out in Prima Paint, according to the
court, cannot be applied when there is a claim of mental incapacity as such
a claim relates to both the matrix contract and the arbitration agreement .
(167) The Spahr decision can thus be viewed as a refusal of the doctrine
where there is a mental capacity formation -based challenge, such that
the two agreements cannot be separated. (168) As the court held in
unequivocal terms, 'Unlike a claim of fraud in the inducement, which can be
directed at individual provisions in a contract, a mental capacity challenge
can logically be directed only at the entire contract'. (169) It can be
concluded from this and similar cases involving mental incapacity, that the
matrix contract and the arbitration agreement could be deemed
'inseparable', (170) as the lack of consent is detrimental to both
agreements. (171)
The English High Court adopted a similar approach to the court in Spahr in
Hyundai Merchant Marine Company Limited v Americas Bulk Transport Ltd,
(172) where the issue in question also concerned whether a contract had
been validly entered into. The English High Court affirmed that the question
of whether an arbitration clause had validly been entered into was
P 379 dependent upon whether the matrix contract had been validly entered into.
P 380 The Court found that if the matrix contract had been validly entered into
the arbitration clause would be upheld, while if it had not been validly
entered into then litigation as the default form of dispute resolution would
be employed to determine the effect of that validity . The parties had
actually entered into arbitration and the arbitrator had determined that
there had been a contract and that therefore there had been an arbitration
clause entered into. The Court however set aside the arbitrator's award,
given that the question of whether or not there was an arbitration clause
was affected by the fact of whether there was a contract; arbitration could
not be employed to determine the two questions. As Eder J remarked '. . .the
questions whether there was a binding fixture and/or a binding arbitration
agreement stand or fall together. . .' (173) As there had been a complete
lack of consensus as to the terms of the contract, the court concluded that
no valid contract existed in the first place.
The Court made it clear that, consistent with previous decisions, arbitration
clauses will be severable from the matrix contract when considering
whether contracts entered into will be subsequently voided, but the two
agreements will be considered together when considering whether the
matrix contract, comprising the arbitration clause, was valid in the first
place.
Prior to Hyandai, courts had explicitly recognized that there would be

instances where separability would not be applicable. (174) In Fiona Trust,
the Court recognized that there may be instances where contentions
focusing on the validity of an arbitration clause would be the same
contentions concerning the validity of the matrix contract. Lord Hope of
Craighead referred to the issues than can arise when the arbitration clause
P 380 and main agreement are comprised in the same document:
P 381
. . . an arbitral award possesses no binding force except that which
is derived from the joint mandate of the contracting parties.
Everything depends on their contract, and if there was no contract
to go to arbitration at all an arbitrator's award can have no
validity . So, where the arbitration agreement is set out in the
same document as the main contract, the issue whether there
was an agreement at all may indeed affect all parts of it. Issues as
to whether the entire agreement was procured by impersonation
or by forgery, for example, are unlikely to be severable from the
arbitration clause. (175)
Similar to the decision in Spahr, the court's ruling in Hyundai can be viewed
as a limitation on the principle of separability. (176) The court's
determination that the arbitral award should be set aside in light of the
doubtful existence of the arbitration clause meant that it considered the

relatedprinciple to separability, competence–competence, the capacity of

the tribunal to determine its own jurisdiction, did not apply either, and this
exception should be borne in mind in future. (177)
6. AN OVERREACHING DOCTRINE
Despite its wide acceptance, the doctrine of separability is often contested
and is regularly the subject of disputes and misunderstandings. (178) It has
been suggested that as arbitration clauses are instrumental in the
fundamental operation of contractual dispute resolution, they present
unique threats to the fundamental rights and obligations of contracting
parties. Separability has been viewed as archaic, unworkable, and a
distortion of contract law by assuming away the fundamental principle of
P 381
P 382
contractual consent. (179) The consequence is that there is no simple, one-
size-fits-all desirable rule (180) and that no contract should be arbitrated
unless the parties have specifically stated that they want to arbitrate their
disputes, as parties have a constitutional right to litigate rather than
arbitrate. (181)
The arbitration agreement , it is believed, cannot be separated from the

main contract as the process cannot exist, nor indeed can the award be
rendered, in a vacuum. (182) The doctrine has also been characterized as an
ambiguous term and a judicial fiction to save 'competence', (183) and an
unduly blunt instrument that can result in unfortunate consequences when
applied to arbitration agreements. For example, if a party has a justifiable
argument that the matrix contract resulted from inducement, it is
unreasonable for the party making the claim of inducement to be
compelled to arbitrate. (184) It has been suggested that if the courts
thoroughly explore the facts and issues before deciding whether the parties
should be compelled to arbitrate, the separability doctrine could be
enhanced. (185) An example of this approach was taken in Konkola Copper
Mines v Coromin, (186) where the courts enquired into which party had 'the
better of the argument'. (187) It follows that courts could intervene where
there is a concern about the validity of the agreement, determine the
validity of the arbitration clause and refer the matter to arbitration in
appropriate circumstances. (188)
While the legal capacity to enter into the main contract should entail the
legal capacity to enter into the arbitration agreement , (189) in
circumstances where a party's capacity to contract is in doubt, the issue is
that separating the main contract from the arbitration agreement
becomes challenging. (190) In such circumstances, the expertise of an
arbitral panel to effectively judicially determine the issue by correctly
applying the substantive and procedural law in the determination of the
capacity of the party when concluding the contract can be understandably

doubted. Similarly, there may be understandable concerns regarding the
competence of an arbitral tribunal to determine contractual formation ,
essentially a legal issue, as it may not possess the necessary judicial
expertise. Indeed, arbitrators are usually selected on the basis of their
expertise of the context in which the dispute occurred, rather than as a
P 382
result of their legal or judicial training. (191)
P 383
The fact that the doctrine limits the rights of parties to submit their
disputes to litigation is its greatest challenge. (192) As the separability
P 383 doctrine separates arbitration law from an important aspect of contract law,
the defences to enforcement, it fails to provide the right of access to court
that would provide the protection of those defences. While under contract
law, the right to litigate would be waived by an enforceable contract, it is
contended that the right to litigate should not be waivable due to illegality,
misrepresentations or duress (193) and that no arbitration clause,
regardless of its wording, should have the authority to stop a court from
exercising jurisdiction to decide whether a contract was ever concluded.
(194) While parties have attempted to frustrate arbitration proceedings by
pleading their right to a fair trial under Article 6 of the European Convention
on Human Rights, the courts have failed to provide relief in such
circumstances, (195) as the parties have willingly elected to arbitrate their
disputes instead of exercising their right to litigation in court. (196) It has
been suggested that the separability doctrine should consequently be
repealed to allow courts to hear defences to the enforcement of the
contract containing the arbitration clause. Courts, it is contended, should
only send cases to arbitration after hearing and rejecting such defences.
(197)
In such circumstances, where parties cannot avail of court relief, the

principle is believed to pervert contract law as it effectively disregards
contractual consent and impedes contractual formation based defences
applying that could impair the enforceability of a contract comprising an
arbitration clause. (198) The point is illustrated through the example of the
hypothetical individual who enters into a matrix contract that includes an
arbitration clause, with a gun pointed at his head. If an arbitration claim is
subsequently brought and the separability principle applied, an application
to stay the arbitration by this individual is unlikely to be successful as the
challenge based on duress is a challenge to the validity of the whole
contract and not the arbitration clause specifically. Hence the individual's
right to litigate the issue in court is deprived of the protection provided by
the defences of contract law. (199)

In Fiona Trust, only a vitiating factor that related directly to the arbitration
clause as distinct from the matrix contract generally would be sufficient,
according to Lord Hoffman, to impeach it. This may not be easy to
determine. If parties are asked if they expect that a court or arbitral
tribunal which they have chosen will settle disputes about contractual
validity and contractual performance, they are likely to confirm this to be
the case. However, if they are asked whether they gave their consent to an
agreement obtained through misrepresentation, fraud, duress or corruption
of agency, they are likely to confirm this is not the case. (200) This
demonstrates the concern around the legal fiction of implied consent to
arbitration that is central to the doctrine of separability discussed
previously. There is also an ethical concern regarding the appropriateness
of a person possessing the authority to determine the validity of the
matrix contract who may ultimately profit from that decision. Arbitrators
have a vested interest in the outcome of arbitral tribunal decisions
generally, including decisions relating to separability. (201) Those who
criticize the 'implied consent' concept contend that when it comes to the
issue of the signature, the arbitration agreement is just one contractual
provision and parties to a contract do not sign each provision individually.
However, due to the separability principle, arbitration clauses are treated
differently from other contractual provisions and the legal fiction of
separability is counter-intuitive in this respect. (202)
This concern is revealed in the rules of prominent arbitral institutions, such

as Article 6(9) of the International Chamber of Commerce Rules of
Arbitration (203) and Article 23(2) of the Arbitration Rules of the London
Court of International Arbitration, (204) that provide that the arbitration
clause is not automatically invalid due to the non-existence or nullity of the
main contract. Such rules do not provide further guidance on the
circumstances when the invalidity of the matrix contract will affect the
arbitration clause comprised within it, as the arbitral tribunal possesses the
authority to make this determination, subject to review where appropriate
by the national courts. (205) Consistent with the discussion above, in most
cases, particularly those that relate to validity or legality issues, as
distinct from issues of formation , arbitral tribunals have rejected
contentions that allegations of defects relating to the matrix contract also
nullified the arbitration clause comprised within it and have applied the
separability principle. (206)
There is considerable variance in perspectives with regard to the link

between the separability principle and the competence–competence
doctrine, (207) and while virtually all national legal systems recognize the
competence–competence principle, there is not a consistent understanding

of the doctrine's application or consequences. (208) Some contend that an

independent arbitration clause provides the basis for an arbitral tribunal to
determine its own jurisdiction, even where there is a contention that the
matrix contract has been terminated by an intervening event or by being
performed. (209) However, consistent with the discussion above, the better
view is that an arbitral tribunal's power to determine its own jurisdiction
cannot be dependent on the separability principle, as the competence–
competence doctrine provides for this even in circumstances where the
existence or validity of the arbitration agreement , as distinct from the
matrix contract, is contested. (210) The competence–competence doctrine
also establishes a presumption of chronological priority for the tribunal
with respect to resolving jurisdiction questions. This 'negative effect'
restricts a court in providing the tribunal with the first opportunity to
decide on its own jurisdiction and the validity of the arbitration
agreement , and consequently restricts a court from reconsidering the
merits of the dispute when determining the existence or validity of the
arbitration agreement prior to the arbitral tribunal. (211)
A separate choice of law analysis is required with regard to the arbitration
agreement due to its autonomy. (212) This may result in the arbitration
clause being governed by a different national law or different set of
substantive legal rules within the same legal system from that which
applies to the matrix contract that it is comprised within. (213) In the
majority of cases it will be the law where the arbitration is being held,
but the law regarding separability and conflict of laws is not very clear. (214)
It seems that English law has failed to clarify the extent to which
jurisdiction agreements are separate and distinct from the matrix contracts
within which they are comprised. In Mackender v Feldia (215) the court
determined that a jurisdiction agreement could be valid where the matrix
contract is voidable, but it didn't clarify whether the same rule applied in
cases where the matrix contract was void ab initio or from the start. (216)
Hence jurisdiction agreements may be governed by a law different from the
law that governs the matrix contract. (217) Another aspect of the conflict of
laws dimension is the concern that it may give rise to sovereignty issues in
future, as it gives arbitrators the power to decide on the legality of
contracts as per the laws of one of the countries of the parties, creating a
perplexed situation in which the arbitration may transcend the municipal
laws of states concerned. (218)
As alluded to above, some critics of the doctrine of separability characterize

it as a legal fiction that favours commercial pragmatism over logic. (219)
While there was traditionally some debate as to whether the parties should
explicitly express their intentions, it is now well established that an implicit

presumptive intent is sufficient. (220) Hence parties, and indeed their

advisors, may not always be aware of the implications of including
arbitration clauses in commercial contracts. A cautious approach is
therefore warranted when lawyers are advising parties and drafting
arbitration clauses for inclusion in commercial contracts.
A broader construction of the arbitration clause in line with the intentions

of the parties (221) would also enhance a cautious advisory and drafting
approach, as an incorrect application may not reflect what the parties want.
(222) The objections to the autonomy of the arbitral tribunal discussed
above could also be offset by providing in the agreement that only suitably
qualified individuals, with sufficient legal and subject specific expertise may
be appointed to act as arbitrator, from a reputable institution or
organization that the parties deem acceptable. It would be best to clearly
provide in the arbitration agreement the disputes that parties want
arbitrated and those that they require to be judicially determined. Parties
may want to adopt a restrictive approach, where courts hear defences to
the enforcement of the contract containing the arbitration clause. This
would mean that the right of access to court would only be set aside where
there is an enforceable contract, not a contract that is unenforceable due to
misrepresentation, duress, illegality or any other contract law defence.
Conversely, it may be the case that parties want claims relating to the
matrix contract to be arbitrated, while any claim relating to the arbitration
clause requires court determination. For example, a misrepresentation
claim may be heard by an arbitrator while a duress claim would be referred
to court. (223)
Hence, parties should clearly elucidate their intentions as to how

preliminary matters such as fraud or the existence of the contract should be
dealt with and where such contentions arise; the disputes would be
resolved with reference to the parties' agreement. This is necessary in order
to safeguard the sanctity of arbitral agreements and the parties' intention
to pursue their contractual and arbitral agreements. (224) The adoption of
such an approach is provided for in England as a result of the wording of
section 7 of the Arbitration Act 1996, as it states 'Unless otherwise agreed to
by the parties. . .' This facilitates in a very clear way that the parties may
determine the extent to which their arbitration clause is separate from their
matrix contract. The arbitral tribunal's capacity to determine its own
jurisdiction in the first instance is conditioned by granting the tribunal's
ruling a provisional status which is ultimately reviewable by the court,
which reserves the power to conduct a review once an award is issued, to
either set the award aside or enforce it. (225) Parties can temper further the
tribunal's power to determine its own jurisdiction by including such

limitations in their agreement also. Hence, parties can prescribe the extent
to which their agreements to arbitrate are separate from their matrix
contracts, and the extent to which the tribunal may make this
determination, ensuring concurrence between the application of the
doctrines of separability and competence–competence and the parties'
intentions. (226)
Parties may also to some extent insulate themselves from the uncertainty
of separability through recourse to the national courts where necessity in
the preliminary stage. If satisfied that the arbitration agreement is valid,
the court may then refer the issue back to the arbitral tribunal for
determination. It seems irrational to require a party who believes they are
not bound to arbitrate but are free to litigate, to constitute an arbitral
tribunal solely for the purpose of obtaining their non-arbitration ruling
from it. (227) A logical response to this, is that a first seised rule could be
applied, providing for the arbitrator to decide if arbitral proceedings
were instituted before the court proceedings were, letting the judge
proceed first if he was seised before the arbitration was commenced. As the
question is a procedural one, courts could refine their procedure to meet
the requirements of the law. (228) Like all areas of the law, the doctrine is a
living instrument, and could organically adapt to facilitate this approach.
7. CONCLUSION
Arbitration law has now evolved to quite an advanced stage as the
arbitration agreement is deemed independent and confers upon the
arbitrator the authority to render the main contract void ab initio. The
doctrine of separability has gradually received judicial approval in England,
and judicial opinion elsewhere has also been in agreement with the
widespread inclination of recognizing the doctrine. (229) This has enhanced
arbitral predictability and uniformity, and reinforced the significance of
arbitration as a means to determine disputes. (230)
Separability may be viewed as the creation of practical necessity that has

had a considerable impact on how contemporary arbitration functions. (231)
As discussed, there is consensus internationally on the need to protect the
integrity of arbitration agreements and the doctrine operates to offer that
protection through pragmatic judicial realism when relevant cases come
before the courts, even in cases involving claims of illegality due to bribery
and corruption, or where a public policy rule renders the main contract
illegal. This wide reaching doctrine is tempered in circumstances where the
matrix contract is not validly entered into, where the courts have developed
an exception to, or limitation on, the doctrine. The issue of whether an
agreement to arbitrate had been entered into is tied to the issue of whether
the matrix contract was validly formed, and this reality has been recognized
by the courts in seminal cases such as Fiona Trust, where the court
considered that there may be instances where the issues that determine
the validity of an arbitration clause would be the same issues as those
that determine the validity of the matrix contract, demonstrating that
arbitration clauses are not completely separate agreements in such
circumstances.
It is clear that the doctrine of separability is widely accepted. Countries

such as the USA, England, Australia, Germany, Switzerland, France, and
Belgium recognize the principle of separability, even where the matrix
contract in question is invalid, illegal or terminated. The doctrine of
separability has travelled extensively and evolved since it was first
enunciated. The acceptance of the doctrine by diverse jurisdictions reflects
the international confidence in the doctrine in protecting arbitration
agreements comprised within commercial contracts. While the doctrine of
separability is the cornerstone of the arbitral process, and without it
arbitration clauses could be deemed impotent, it continues to be an
academic and institutional challenge. (232) In order to ensure that parties
enjoy the full benefits provided by the separability doctrine and avoid
the potential negative overreach discussed above, legal advisors must
remain mindful of eliciting the relevant instructions from clients, providing
the appropriate advice and reflecting the parties needs and intentions in
their agreements, supported by courts that provide the appropriate
intervention when required.
References
*) Ronán Feehily, University of Canterbury; BComm (Hons); LL.B. (Hons);

MBA (N.U.I.); LL.M. (Dub.); Ph.D. (U.C.T.); DipArb (N.U.I.); PGCAP (Dunelm);
PGCTT (Cant.); FCIArb; FHEA; Solicitor (Ireland, Northern Ireland,
England and Wales), C.E.D.R.; Accredited Mediator. Email:
ronan.feehily@gmail.com (mailto:ronan.feehily@gmail.com).
1) G Born, International Arbitration: Law and Practice (1st edn, Kluwer Law
International 2012) 4–6; Nigel Blackaby and Constance Partasides with
Alan Redfern and Martin Hunter, Redfern and Hunter on International
Arbitration (6th edn, Oxford University Press 2015) 71; Julian DM Lew,
Loukas A Mistelis and Stefan Kröll, Comparative International
Commercial Arbitration (Kluwer Law International 2003) para 6-1.
2) Lew, Mistelis and Kröll (n 1 (/document/KLI-KA-AI-2018-03-003#n1))
para 6-3.
3)
Generally, the basis for arbitration is set out in the arbitration

agreement , which comprises an agreement to submit present or
future disputes to arbitration and is reflected in an arbitration clause
in an existing agreement or a submission agreement that is agreed by
the parties after the dispute arises. See Jean-François Poudret and
Sébastien Besson, Comparative Law of International Arbitration (Sweet
& Maxwell 2007) 120–23; Lew, Mistelis and Kröll (n 1 (/document/KLI-
KA-AI-2018-03-003#n1)) para 6-8; Margaret L Moses, The Principles and
Practice of International Commercial Arbitration (2nd edn, CUP 2012)
18.
para 6-2; Redfern and Hunter (n 1 (/document/KLI-KA-AI-2018-03-
003#n1)) 71; Cary Singletary, 'High Court Boosts Arbitration in Buckeye'
(2006) 61 Dispute Resolution Journal 2, 4–5; Stephen M Schwebel,
International Arbitration: Three Salient Problems (Grotius Publications
1987) 4; Zeb-Michael Curtin, 'Rethinking Prima Paint Separability in
Today's Changed Arbitration Regime: The Case for Inseparability and
Judicial Decision making in the Context of Mental Incapacity Defenses'
(2004–2005) 90 Iowa Law Review 1905–1937, 1917.
para 6-1.
6) ibid para 6-2; Redfern and Hunter (n 1 (/document/KLI-KA-AI-2018-03-
003#n1)) 18.
7) Francis Okanigbuan Jr, 'Revisiting the Separability Doctrine and Parties'
Rights to Litigation in Commercial Transactions' (2015) 26 International
Company and Commercial Law Review 255.
8) For a discussion on the meaning of 'autonomy' in international
commercial arbitration, see E Gaillard and J Savage, Fouchard Gailard
Goldman on International Commercial Arbitration (Kluwer
International Law 1999) 197.
9) G Born, International Commercial Arbitration (2nd edn, Kluwer Law
International 2014) 351–52. Many different terms are used to describe
the contract from which the arbitration clause is deemed separable,
including 'underlying', 'container', 'substantive', and 'commercial'. For
simplicity and consistency, the term 'matrix' is employed to describe
this agreement throughout this article.
10) See also, Fabio Solimene, 'The Doctrine of Separability and its
Contribution to the Development of International Commercial Law'
(2014) 80 Arbitration 249–55, 252; Okanigbuan (n 7 (/document/KLI-KA-
AI-2018-03-003#n7)) 255.
11)
Kaj Hober and Annette Magnusson, 'The Special Status of Agreements
to Arbitrate: The Separability Doctrine; Mandatory Stay of Litigation'

(2008) 2 Dispute Resolution International 56–74, 57. See also, Solimene

(n 10 (/document/KLI-KA-AI-2018-03-003#n10)) 252–53; Jennifer
Bagwell, 'Enforcement of Arbitration Agreements: The Severability
Doctrine in the International Arena - Republic of Nicaragua v. Standard
Fruit Co., 927 F.2d 469 (9th Cir. 1991)' (1992) 22 (2) Georgia Journal of
International and Comparative Law 487–514, 513; Lew, Mistelis and Kröll
(n 1 (/document/KLI-KA-AI-2018-03-003#n1)) 100.
12) Born (n 1 (/document/KLI-KA-AI-2018-03-003#n1)) 50; Matti S
Kurkela, Due Process in International Commercial Arbitration (2nd
edn, Oxford University Press 2010) 72–80. Lew, Mistelis and Kröll (n 1
(/document/KLI-KA-AI-2018-03-003#n1)) 102, Gary B Born and Peter B
Rutledge, International Civil Litigation in United States Courts (5th
edn, Kluwer Law International 2006) 1093. See also Born (n 9
(/document/KLI-KA-AI-2018-03-003#n9)) 353.
13) See Philip Landolt, 'The Inconvenience of Principle: Separability and
Kompetenz-Kompetenz' (2013) 30 Journal of International Arbitration
511–30, 512.
14) Zheng Sophia Tang, 'Parallel Proceedings and Anti-Arbitration
Injunction' (2012) 7 Journal of Business Law 589–610, 596.
15) art 23 (1) of the United Nations Commission on International Trade Law
(UNCITRAL) Rules (as revised in 2010), art 6(4) of the International
Chamber of Commerce Rules 1998, art 23(1) of the London Court of
International Arbitration Rules, and art 15 of the American Arbitration
Association's International Arbitration Rules have all adopted
provisions akin to art 16(1) of the UNCITRAL Model Law, discussed
further below.
16) Krutov v Vancouver Hockey Club Ltd, British Columbia Supreme Court
(Canada) 22 November 1991 (CLOUT Case 19).
17) s 352, Civil Code of Azerbaijan. The Convention on the Recognition and
Enforcement of Foreign Arbitral Awards (adopted 10 June 1958, entered
into force 7 June 1959) 330 UNTS 38 (the 'New York Convention'), was
ratified into law on 29 February 2000 and the UNCITRAL Model Law on
International Commercial Arbitration, including art 16.1, dealing with
separability, became law on 18 February 1999. See Ayten Mustafayeva,
'Doctrine of Separability in International Commercial Arbitration'
(2015) 1 Baku State University Law Review 93–98, 97.
18) Gonzalez v Climax Mining Ltd, Philippines Supreme Court, Special
Second Division, 22 January 2007 (CLOUT Case 816).
19)
art 22, Jordanian Arbitration Act 2001. Conversely, Emirati Law does not
contain clear provisions nor have the courts adopted a consistent
approach regarding separability. For a discussion of this issue,
including proposals for reform, see Bakr AF Al-Serhan 'The Separability

of Arbitration Agreement in the Emirati law' (2016) 32 Arbitration

International 313–30.
20) s 19, Arbitration Law of the People's Republic of China. See also Gu
Wexia, 'China's search for complete separability of the Arbitration
Agreement ' (2007) 3 Asian International Arbitration Journal 163–75,
for a discussion on the evolution of the separability doctrine in China,
from partial separability initially to full separability, since 1998.
21) Enrique C Wellbers SAIC AG v Extraktionstechnik Geseelschaft fur
Anlagenbau MBM, Camera Commercial (Argentina) 26 September 1988
(CLOUT Case 719).
22) art 23, Egyptian Arbitration Law 1994.
23) s 16, Arbitration and Conciliation Act 1996.
24) Schwebel (n 4 (/document/KLI-KA-AI-2018-03-003#n4)) 1–13.
25) S Chaturvedi and C Agrawal, 'Jurisdiction to Determine Jurisdiction'
(2011) 77 Arbitration 201–10, 202. See also Redfern and Hunter (n 1
26) Black-Clawson International Ltd v Papierwerke Waldhof-Aschaffenberg
AG [1975] AC 591 HL, [1981] 2 Lloyd's Rep. 446, 455 (Q.B.).
27) Schwebel (n 4 (/document/KLI-KA-AI-2018-03-003#n4)) 2–3, Redfern
and Hunter (n 1 (/document/KLI-KA-AI-2018-03-003#n1)) 104.
28) In the case of arbitration, not submission agreements.
29) Gaillard and Savage (n 8 (/document/KLI-KA-AI-2018-03-003#n8)) 209.
30) Richard C Reuben, 'First Options, Consent to Arbitration, and the
Demise of Separability: Restoring Access to Justice for Contracts with
Arbitration Provisions' (2003) 56 Southern Methodist University Law
Review 819, 849.
31) Schwebel (n 4 (/document/KLI-KA-AI-2018-03-003#n4)) 1–13, Nicholas
Pengelley, 'Separability Revisited: Arbitration Clauses and Bribery'
(2007) 24 Journal of International Arbitration 445, 451.
32) ibid; See also Stephen J Ware, 'Arbitration Law's Separability Doctrine
After Buckeye Check Cashing, Inc. v. Cardegna' (2007) 8 Nevada Law
Journal 107–34, 109.
33) Schwebel (n 4 (/document/KLI-KA-AI-2018-03-003#n4)) 3–6.
34) [1981] A.C. 909.
35) Elf Aquitaine Iran (France) v National Iranian Oil Company, YCA 1986, 97,
102.
36) art 1.1, UNIDROIT Principles of International Commercial Contracts 2010
<http://www.unidroit.org/english/principles/contracts/principles2010
/blackletter2010-english.pdf
(http://www.unidroit.org/english/principles/contracts/principles2010/
blackletter2010-english.pdf)> accessed 6 May 2018.
37) art 1.3, ibid.
38)
For a discussion of this principle in the context of US caselaw, see

Martha Neil, 'Litigation over Arbitration' (2005) 91 American Bar
Association Journal 50–67.
39) SC Bennett, Arbitration: Essential Concepts (ALM Publishing 2002) 7;
Moses (n 3 (/document/KLI-KA-AI-2018-03-003#n3)) 19; M Barendrecht
and BR De Vries, 'Fitting the Forum to the Fuss With Sticky Defaults:
Failure in the market for Dispute Resolution Services' (2005) 7 Cardozo
Journal of Conflict Resolution 83–92, 84; R Schaffer, F Agusti and L
Dhooge, International Business Law And its Environment (Cengage
Learning 2014) 3. See also Chaturvedi and Agrawal (n 25
(/document/KLI-KA-AI-2018-03-003#n25)) 203; Tang (n 14
40) See Doug Jones, 'Competence-competence' (2009) 75 Arbitration 56–64.
In France, it is known as 'Competence–Competence', while in Germany
it is known as 'Kompetenz-Kompetenz', see Dominique T Hascher,
'Arbitration and National Courts: Conflict and Cooperation' (2010) 21
American Review of International Arbitration 189, 191.
41) See JM Graves and Y Davydan, Competence-Competence and
Separability - American Style (Kluwer Law International 2011) 158. For
an overview of the approach adopted in international instruments,
and jurisdictions such as France, Germany and the USA; see John J
Barceló III, 'Who Decides the Arbitrators' Jurisdiction? Separability and
Competence- Competence in Transnational Perspective' (2003) 36
Vanderbilt Journal of Transnational Law 1115–1136. See also, Ilias
Bantekas, An Introduction to International Arbitration (Cambridge
University Press 2015) 109–112.
42) John AE Pottow, Jacob Brege and Tara J Hawley, 'A Presumptively Better
Approach to Arbitrability' (2013) 53 Canadian Business Law Journal 165–
201, 169.
43) William Park, 'The Arbitrator's Jurisdiction to Determine Jurisdiction'
(13 ICCA Congress Series 55, ICCA Congress, Montréal 2006) 60–61.
44) Tang (n 14 (/document/KLI-KA-AI-2018-03-003#n14)) 597. Adrian Baron,
'Arbitration and the Fiction of Severability' (1999) 19 Australian Bar
Review 49, 63. For a discussion on parallel proceedings and the
procedural mechanisms that have been developed to mitigate or avoid
their baleful effects, in particular mandatory consolidation, see
Bernardo M Cremades and Ignacio Madalena, 'Parallel Proceedings in
International Arbitration' (2008) 24 Arbitration International 507–36.
45)
Jones (n 40 (/document/KLI-KA-AI-2018-03-003#n40)) 57. See also
Hober and Magnusson (n 11 (/document/KLI-KA-AI-2018-03-003#n11))
59; Francisco Gonzalez De Cossfo 'The Competence–Competence
Principle Revisited' (2007) 24 Journal of International Arbitration 232;

Philippe Leboulanger, 'The Arbitration Agreement : Still

Autonomous?' in Albert Jan van den Berg (ed), International Arbitration
2006: Back to Basics? ICCA Congress Series 2006, Montreal 13 (Kluwer
Law International 2007) 3–31, 10.
46) Park (n 43 (/document/KLI-KA-AI-2018-03-003#n43)) 60.
47) Born (n 9 (/document/KLI-KA-AI-2018-03-003#n9)) 469–70.
48) Park (n 43 (/document/KLI-KA-AI-2018-03-003#n43)) 60.
49) William Park, 'Determining Arbitral Jurisdiction: Allocation of Tasks
between Courts and Arbitrators' (1997) 8 American Review of
International Arbitration 133–46, 144.
50) Chaturvedi and Agrawal (n 25 (/document/KLI-KA-AI-2018-03-003#n25))
201–10, 203. For a discussion on the evolution of this issue, including
the relevant UK caselaw, see Alexander Trukhtanov, 'Separability of
Arbitration Clause and Jurisdiction' (2008) 11 International Arbitration
Law Review N6-9.
203. For a discussion on the conflicting views of whether such powers
are inherent powers of the tribunal, see Chaturvedi and Agrawal (n 25
(/document/KLI-KA-AI-2018-03-003#n25)) 203–06. See also Baron (n 44
52) Park (n 49 (/document/KLI-KA-AI-2018-03-003#n49)) 143–144.
53) Park (n 43 (/document/KLI-KA-AI-2018-03-003#n43)) 61–62.
54) In India, for example, a series of cases appeared to reject the concept,
although this stance appears to have softened, see Kvaerner
Cementation India Ltd v Bajranglal Aggaral (2012) 5 SCC 214, referred to
in Redfern and Hunter (n 1 (/document/KLI-KA-AI-2018-03-003#n1))
341.
55) Par 19, Vee Networks Ltd v Econet Wireless International Ltd [2004]
EWHC 2909 (QB). See also Redfern and Hunter (n 1 (/document/KLI-KA-
AI-2018-03-003#n1)) 341.
56) See Chaturvedi and Agrawal (n 25 (/document/KLI-KA-AI-2018-03-
003#n25)) 209.
57) See art 23(1) of the UNCITRAL Arbitration Rules
<http://www.uncitral.org/uncitral/en/uncitral_texts/arbitration/2010A
rbitration_rules.html
(http://www.uncitral.org/uncitral/en/uncitral_texts/arbitration/2010Ar
bitration_rules.html)> accessed 6 May 2018.
58) See art 16(1) of the UNCITRAL Model Law on International Commercial
Arbitration
<http://www.uncitral.org/uncitral/en/uncitral_texts/arbitration.html
(http://www.uncitral.org/uncitral/en/uncitral_texts/arbitration.html)>
accessed 6 May 2018.
59)
See art 23(1) of the Rules of the London Court of International

Arbitration <http://www.lcia.org/Dispute_Resolution_Services/lcia-
arbitration-rules-2014.aspx#Article%2023
(http://www.lcia.org/Dispute_Resolution_Services/lcia-arbitration-
rules-2014.aspx#Article%2023)> accessed 6 May 2018.
60) See art 6(9) of the International Chamber of Commerce Rules of
Arbitration <http://www.iccwbo.org/products-and-
services/arbitration-and-adr/arbitration/icc-rules-of-arbitration
(http://www.iccwbo.org/products-and-services/arbitration-and-
adr/arbitration/icc-rules-of-arbitration)> accessed 6 May 2018.
61) art 16(1) of the Australian International Arbitration Act 1974 adopts this
approach also, while, as noted above, the English Arbitration Act deals
with each principle in separate provisions, with the same result. See
also, Jones (n 40 (/document/KLI-KA-AI-2018-03-003#n40)) 57. Indeed,
some authors refer to competence–competence as one of the two
elements of the separability rule. See for example, Redfern and Hunter
(n 1 (/document/KLI-KA-AI-2018-03-003#n1)) 341. However, this
approach has given rise to confusion between the two related but
distinct concepts. See further below.
62) For an overview of the earlier formative jurisprudence and principles
dealing with illegality, see RH Kreindler, 'Aspects of Illegality in the
Formation and Performance of Contracts' International Arbitration
Law Review (2003) 6 1–24.
63) Born (n 9 (/document/KLI-KA-AI-2018-03-003#n9)) 401. See also D
Sutton, J Gill and M Gearing, Russell On Arbitration (24th edn, Sweet &
Maxwell 2015) para 2-009; Schwebel (n 4 (/document/KLI-KA-AI-2018-
03-003#n4)) 5.
64) Born (n 9 (/document/KLI-KA-AI-2018-03-003#n9)) 401; Park (n 52
(/document/KLI-KA-AI-2018-03-003#n52)) 143. See also A Burrows,
English Private Law (OUP 2013) 1387.
65) Redfern and Hunter (n 1 (/document/KLI-KA-AI-2018-03-003#n1)) 106.
66) Born (n 9 (/document/KLI-KA-AI-2018-03-003#n9)) 402.
67) Schwebel (n 4 (/document/KLI-KA-AI-2018-03-003#n4)) 1–13. See also
Lawrence Atsegbua, 'International Arbitration of Oil Investment
Disputes: The Severability Doctrine and Applicable Law Issues
Revisited' (1993) 5 African Journal of International and Comparative
Law 634, 640.
69) art II (1), New York Convention. See also Born (n 9 (/document/KLI-KA-
AI-2018-03-003#n9)) 403.
70) 484 UNTS 364, adopted 21 April 1961, entered into force 7 January 1964.
71)
art V, European Convention on International Commercial Arbitration.

The doctrine of separability is considered as one of the transnational

rules of international commercial arbitration for sometime, see KP
Berger, International Economic Arbitration (Kluwer Law International
1993) 121.
72) United Nations Commission on International Trade Law, UNCITRAL
Model Law on International Commercial Arbitration (adopted on 21
June 1985 and amended on 7 July 2006) UN Doc A/40/17, Annex I and
A/61/17, Annex I.
73) See P Binder, International Commercial Arbitration and Conciliation in
UNCITRAL Model Law Jurisdictions (3rd edn, Sweet & Maxwell 2009)
para 4-009.
74) This can be contrasted with forum selection clauses. See G Born,
International Arbitration and Forum Selection Agreements: Drafting
and Enforcing (4th edn, Kluwer Law International 2013) 136. See also
generally, VV Veeder, 'From Florence to London via Moscow and New
Delhi: How and Why Arbitral Ideas Migrate' (2013) 4 Journal of
International Dispute Settlement 139–57.
75) Adam Samuel, 'Separability of Arbitration Clauses—Some Awkward
Questions About The Law On Contracts, Conflict Of Laws And The
Administration Of Justice' (2000) 9 Arbitration and Dispute Resolution
Law Journal 36, 41. See also Born (n 74 (/document/KLI-KA-AI-2018-03-
003#n74)) 128.
76) The two principals were established in England in Heyman v Darwins
Ltd [1942] AC 356 (HL) and Harbour Assurance Co (UK) Ltd v Kansa
General International Insurance Co Ltd and Others [1993] QB 701,
respectively, and in the USA in Prima Paint Corporation v Flood &
Conklin Manufacturing [1967] 388 US 395 404 and Buckeye Check
Cashing, Inc v Cardegna [2006] 546 US 440 respectively, discussed
further below.
77) Tang (n 14 (/document/KLI-KA-AI-2018-03-003#n14)) 596.
78) Jones (n 40 (/document/KLI-KA-AI-2018-03-003#n40)) 57; Matthew
Parish, 'The Proper Law Of an Arbitration Agreement ' (2010) 76(4)
Arbitration 661–79, 663.
79)
South Africa, for example adopts a restrictive approach. Separability
only takes effect if the contract is terminated by repudiation or if it is
due to the voidability of the contract. If the contract is invalid, the
arbitration clause will also be invalid. See Gerhard Rudolph,
'Commercial Arbitration, South Africa', American Arbitration
Association Global Arbitration Review
<http://globalarbitrationreview.com/know-
how/topics/61/jurisdictions/2/south-africa/

(http://globalarbitrationreview.com/know-
how/topics/61/jurisdictions/2/south-africa/)> accessed 6 May 2018.
80) See Moloff Leda, 'On the Face of it? Establishing Jurisdiction on Claims
to Compel Arbitration Under Section 4 of the FAA' [2008] 77(1) Fordham
Law Review 190–99; Claudia Salomon , 'The United States Federal
Arbitration Act: A Powerful Tool for Enforcing Arbitration Agreements
and Arbitral Awards' (LexisPSL Arbitration, 17 April 2014)
<file:///C:/Users/User/Downloads/the-us-fed-arbitration-act.pdf
(http://file:///C:/Users/User/Downloads/the-us-fed-arbitration-
act.pdf)>accessed 6 May 2018. See also generally, Alan Scott Rau,
'Contracting out of the Arbitration Act' (1997) 9 American Review of
International Arbitration 225–61.
82) See Professor the Hon Andrew Rogers QC and Rachel Launders,
'Separability—the Indestructible Arbitration Clause' (1994) 10
Arbitration International 77–90, 82.
83) [1959] 271 F. 2D 402.
84) [1959] 271 F. 2D 410.
85) (1967) 388 US 395.
86) (2006) 546 US 440.
87) For a discussion and critique of the Court's rationale in this case, see
Curtin (n 4 (/document/KLI-KA-AI-2018-03-003#n4)) 1920–22.
88) [1967] 388 US 402. The ruling of Fortas J in Prima Paint Corporation v
Flood & Conklin Manufacturing Co was applied in numerous
subsequent cases including Information Sciences Inc v Mohawk Data
Science Corp [1978] 43 NY2d 918 and Peoples Security Life Insurance
Company v Monumental Life Insurance Company 867 F.2d 809 (4th Cir
1989).
89) See Ware (n 32 (/document/KLI-KA-AI-2018-03-003#n32)) 111.
90) (2010) 561 US 63. For a discussion of this case, see Diana
Gesualdi, 'Supreme Court: Scalia, in Rent-A-Center, Redefines the
Judicial Role in Ruling on Agreements to Arbitrate (June 21)' The
International Institute for Conflict Prevention & Resolution
<http://www.cpradr.org/About/NewsandArticles/tabid/265/ID/651/Su
preme-Court-Scalia-in-Rent-A-Center-R...
(http://www.cpradr.org/About/NewsandArticles/tabid/265/ID/651/Sup
reme-Court-Scalia-in-Rent-A-Center-Redefines-the-Judicial-Role-in-
Ruling-on-Agreements-to-Arbitrate-June-21.aspx)>accessed 6 May
2018.
92)
Samuel (n 75 (/document/KLI-KA-AI-2018-03-003#n75)) 41. See also
Hossein Fazilatfa, 'Characterizing International Arbitration Agreements

as Truly Separable Clauses' (2012) 10 Rutgers Conflict Resolution Law

Journal 6. See also generally Samuel, 'Separability in English Law-
Should an Arbitration Clause be Regarded as an Agreement Separate
and Collateral to a Contract in Which It is Contained?' (1986) 3 Journal
of International Arbitration, 95–109.
93) G Wilsherr, 'The Doctrine Of Separability: The Last Stand Of Orthodoxy:
Harbour V Kansa and Others' (1993) 1 International Insurance Law
Review 345–48.
94) For a discussion on the evolution of the approach adopted towards
this concept in the USA, including an overview of the relevant
supporting jurisprudence, see Tanya J Monestier, 'Nothing Comes of
Nothing. . . Or does it? A Critical Re-Examination of the Doctrine of
Separability in American Arbitration' (2001) 12 American Review of
International Arbitration 223–47. See also Pierre Mayer, 'The Limits of
Severability of the Arbitration Clause' in Albert Jan van den Berg (ed),
Improving the Efficiency of Arbitration Agreements and Awards: 40
Years of Application of the New York Convention, ICCA Congress Series,
9 (Kluwer Law International 1999) 261–67.
95) [1926] AC 497.
96) [1927] 1 Ch 300. See also J Lew, Contemporary Problems in International
Arbitration (Springer 2013) 76.
97) [1942] AC 356 (HL).
98) [1926] AC 497.
99) See Samuel (n 75 (/document/KLI-KA-AI-2018-03-003#n75)) 41. See also
generally, A Arzandeh and J Hill, 'Ascertaining the Proper Law of an
Arbitration Clause under English Law' (2009) 5 Journal of Private
International Law 425–45.
100) See Overseas v AA Mutual [1988] 2 Lloyd's Reports 63, 66. See also
Joachim Delaney and Katharina Lewis, 'The Presumptive Approach to
the Construction of Arbitration Agreements and the Principle of
Separability—English Law Post Fiona Trust and Australian Law
Contrasted' (2008) 31 UNSW Law Journal 341, 344.
101) For an overview of this issue and a discussion of the formative case
law, see Delaney and Lewis (n 100 (/document/KLI-KA-AI-2018-03-
003#n100)) 344–49.
102) Harbour Assurance Co. (U.K.) Ltd. (n 76 (/document/KLI-KA-AI-2018-03-
003#n76)).
103) In Nigel Peter Albon v Naza Motor Trading SDN BHD, it was established
that the contract never existed in the first place as it was forged.
104) Harbour Assurance Co (UK) Ltd. v Kansa General International
Insurance Co Ltd [1993] QB 701 (CA).
105) ibid 726.
106)
See Rainer Lukits, 'Arbitration before the European Court of Justice'

(2014) 17 International Arbitration Law Review 1–16, 9; James Carter and
Hannah Kennedy 'English High Court addresses Separability of
Arbitration Clauses' International Arbitration Newsletter (26 June 2013)
3
<www.dlapiper.com/en/global/insights/publications/2013/06/english-
high-court-addresses-separability-o...
(http://www.dlapiper.com/en/global/insights/publications/2013/06/e
nglish-high-court-addresses-separability-of-arb)> accessed 6 May
2018.
107) Fiona Trust & Holding Corp v Privalov [2007] EWCA Civ 20, [2007] 1 All ER
(Comm) 891; Fiona Trust & Holding Corp v Privalov [2007] UKHL 40,
[2007] 4 All ER 951. For a discussion of the case, see Delaney and Lewis
(n 100 (/document/KLI-KA-AI-2018-03-003#n100)) 341–49; Elizabeth
Snodgrass, 'Fiona Trust v Privalov: the Arbitration Act 1996 Comes Of
Age' (2007) 10 International Arbitration Law Review 27.
108) See Filip De Ly 'The Place of Arbitration in the Conflict of Laws of
International Commercial Arbitration: An Exercise in Arbitration
Planning' (1991) 12(1) Northwestern Journal of International Law and
Business 48.
109) Fiona Trust (n 107 (/document/KLI-KA-AI-2018-03-003#n107)) (Lord
Hope of Craighead).
110) ibid. See also Premium Nafta v Fili Shipping (UK 2007) CH 17; M McNeill
and B Juratowitch, 'The Doctrine of Separability and Consent to
Arbitrate' [2008] 24(3) Arbitration International 475–87.
111) Fiona Trust (n 107 (/document/KLI-KA-AI-2018-03-003#n107)) (Lord
Hope of Craighead). For a more detailed discussion of this issue, see
Pengelley (n 31 (/document/KLI-KA-AI-2018-03-003#n31)) 445–54.
112) Lord Hope made close reference to s 4 of the USA's Federal Arbitration
Act 1925 and stated that both the American and English arbitration
acts were similar. He also made reference to the American case Prima
Paint Corporation (n 76 (/document/KLI-KA-AI-2018-03-003#n76))
discussed above, which established the doctrine of separability in the
USA. See Georgios I Zekos, International Commercial and Marine
Arbitration (Routledge 2008) 95. In the subsequent case of Valleys
Municipal Water District v EF Hutton & Co, 988 US (1991), the Court
confirmed that the doctrine of separability was limited to disputes
that sought to avoid or annul a contract but not 'to challenges going to
the very existence of a contract that a party claims never to have
agreed to.'
113)
Fiona Trust (n 107 (/document/KLI-KA-AI-2018-03-003#n107)) (Lord
Hoffman). Lord Hoffmann also stated that if a party alleges that

someone who purported to sign as agent on his behalf had no

authority whatever to conclude any agreement on his behalf, that is an
attack on both the main agreement and the arbitration agreement
and even if the allegation is that there was no concluded agreement
(eg that terms of the main agreement remained to be agreed) that is
not necessarily an attack on the arbitration agreement , Fiona Trust
and Holding Corpn and others v Privalov and others [2007] Bus LR 1719,
1726–27 (Lord Hoffmann). For a discussion of the separability issue in
the context of the assignment of rights in international commercial
arbitration, see Hober and Magnusson (n 11 (/document/KLI-KA-AI-
2018-03-003#n11)) 71–74; Fazilatfa (n 92 (/document/KLI-KA-AI-2018-03-
003#n92)) 11–12; Leboulanger (n 45 (/document/KLI-KA-AI-2018-03-
003#n45)) 4. This decision has consolidated London's reputation as a
leading seat for international arbitration. See Delaney and Lewis (n
100 (/document/KLI-KA-AI-2018-03-003#n100)) 342; John Towsend,
'Foreign Law and Uniformity in English Arbitration: Fiona Trust v
Privalov' (2009) 14 Uniform Law Review 555, 556. For a discussion on
the crucial nature of the severability doctrine for the effectiveness of
the arbitral system, see JF Morissey and JM Graves, International Sales
Law and Arbitration: Problems, Cases and Commentary (Wolters Kluwer
Law & Business 2008) 370; Carter and Kennedy (n 106 (/document/KLI-
KA-AI-2018-03-003#n106)) 3.
114) Sutton, Gill and Gearing (n 63 (/document/KLI-KA-AI-2018-03-
003#n63)) para 2-013.
115) [1999] QB 785 (CA). See also Karl-Heinz Bockstiegel, 'Public Policy as a
Limit to Arbitration and its Enforcement' [2008] 2(1) IBA Journal of
Dispute Resolution 123, 124–25.
116) [2013] EWHC 1063 (Comm), [2013] 2 All E.R. (Comm) 436. In this case the
purpose and policy of the rule in Foster v Driscoll [1929] 1 KB 470 (CA)
relating to the illegality of certain contracts of guarantee because they
formed part of a scheme to evade Chinese foreign exchange control
laws, was held not to affect the arbitration agreement which those
guarantees contained since the London arbitration clause did not
relate to any breach of Chinese law. An alternative approach was
adopted in O'Callaghan v Coral Racing Ltd [1998] APP.L.R. 11/19, where
an arbitration clause in a gaming contract could not survive
independently following a finding of illegality of the main contract.
117)
For a commentary on this case, see Carter and Kennedy (n 106
(/document/KLI-KA-AI-2018-03-003#n106)) 1–4
<https://www.dlapiper.com/en/global/insights/publications/2013/06/
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(https://www.dlapiper.com/en/global/insights/publications/2013/06/

english-high-court-addresses-separability-of-arb__/)> accessed 6 May

2018. For a discussion on the contrasting approach that earlier courts
adopted with the issue of public policy and the separability of
arbitration clauses, see 'The “Separability Doctrine” in American and
Foreign Arbitration' (1939–1940) 17 New York University Law Quarterly
Review 609–16.
118) See TD Grant, 'International Arbitration and English Courts' (2007) 56
International and Comparative Law Quarterly 871–84.
119) KD Beale and P Esposito, 'Emergent International Attitudes towards
Bribery, Corruption and Money Laundering' (2009) 75 Arbitration 360–
73, 365. For an interesting discussion on this point, see Alan Berg,
'Arbitration under a Contract Alleged not to Exist' (2007) 123 Law
Quarterly Review 352–58.
120) Beale and Esposito (n 119 (/document/KLI-KA-AI-2018-03-003#n119))
365–66.
121) See George A Bermann, 'The “Gateway” Problem in International
Commercial Arbitration' (2012) 37 Yale Journal of International Law 1–
50, 24–26.
123) ibid. Limits to the separability presumption have nevertheless been
found in French law, for instance when the assent of one of the parties
is missing. See further below for a comprehensive discussion of this
issue.
124) The Swiss Supreme Court, in the case of Sonatrach v KCA 116 BGE la 56,
JT (1990) 563, ruled that an arbitration clause was independent and
separate from the underlying contract and remains enforceable even
after the main contract was terminated. It was also mentioned that
since the parties did not provide otherwise in their termination
agreement, it was presumed that they had the intention to arbitrate a
dispute in relation to the termination.
125) See Rogers and Launders (n 82 (/document/KLI-KA-AI-2018-03-
003#n82)) 87.
126) See Delaney and Lewis (n 100 (/document/KLI-KA-AI-2018-03-
003#n100)) 350.
127) [1990] 91 ALR 180.
128) [1990] 169 CLR 332.
129) Delaney and Lewis (n 100 (/document/KLI-KA-AI-2018-03-003#n100))
350.
130) [1991] 105 ALR 371.
131) [1991] 100 ALR 361, 379.
132) ibid (Clarke JA).
133)
See Rogers and Launders (n 82 (/document/KLI-KA-AI-2018-03-

003#n82)) 81.
350.
135) [1994] 34 NSWLR 474.
136) [2000] 50 NSWLR 236.
003#n100)) 350.
138) [2006] FCAFC 192.
350.
140) [2005] FCA 1102.
003#n100)) 359.
142) [2006] FCAFC 192.
143) [2007] Bus LR 1719, 1725.
144) For a more detailed discussion on the comparative approach between
English and Australian courts, see Delaney and Lewis (n 100
003#n100)) 362–63.
146) Leboulanger (n 45 (/document/KLI-KA-AI-2018-03-003#n45)) 13. In the
Indian case of UP Rajkiya Nirman Nigam Ltd v Indure Pvt Ltd and
Others AIR 1996 SC 1373, two parties claimed to have entered into an
agreement prior to a joint tender application. The proposal and
counter proposal between the parties differed on important terms,
including joint liabilities and performance of the contract. The Indian
Supreme Court ruled that since the relationship between the parties
could not achieve the status of a legally enforceable agreement, the
arbitration clause did not have any force either. See also Sumeet
Kachwaha and Dharmendra Rautray, 'Arbitration in India: An Overview'
<https://ipba.org/media/fck/files/Arbitration%20in%20India.pdf
(https://ipba.org/media/fck/files/Arbitration%20in%20India.pdf)>
accessed 6 May 2018.
147) Hew R Dundas, 'Renewed Support for Arbitration: The House Of Lords
Reaffirms Key Court Of Appeal Decision' (2008) 74 Arbitration 95–100,
97–99.
148) Leboulanger (n 45 (/document/KLI-KA-AI-2018-03-003#n45)) 13.
149) K Haining and B Zeller, 'Can Separability Save Kompetenz-Kompetenz
When There Is A Challenge To The Existence Of A Contract?' (2010) 76
Arbitration 493–502, 497.
150)
JD Stiner, 'Arbitration: Shaffer v. Jeffery: The Oklahoma Supreme Court
Rejects the Separability Doctrine and Takes a Step Back in the

Enforcement of Arbitration Clauses under Oklahoma Law' (1997) 50

Oklahoma Law Review 243, 244.
151) Gibson LJ, Harbour, Harbour Assurance Co (UK) Ltd v Kansa General
International Insurance Co Ltd [1993] QB 701 (EWCA) 704, 712.
152) Hoffman LJ, Harbour Assurance Co (UK) Ltd v Kansa General
International Insurance Co Ltd [1993] QB 701 (EWCA) 704, 723–24; see
also Berg (n 119 (/document/KLI-KA-AI-2018-03-003#n119)) 352–58.
153) Alan S Rau, 'Everything You Really Need to Know about “Separability”
in Seventeen Simple Propositions' (2003) 14 American Review of
International Arbitration 1–120, 14.
154) Singletary (n 4 (/document/KLI-KA-AI-2018-03-003#n4)) 4–5.
155) Rau (n 153 (/document/KLI-KA-AI-2018-03-003#n153)) 14, see also
Pengelley (n 31 (/document/KLI-KA-AI-2018-03-003#n31)) 449.
156) Kirsten Weisenberger, 'Arbitral & Judicial Decision: From Hostility to
Harmony: Buckeye Marks a Milestone in the Acceptance of Arbitration
in American Jurisprudence' (2005) 16 The American Review of
International Arbitration 551, 559–60.
157) R Stone and J Devenney, Text, Cases and Materials on Contract Law
(Routledge 2014) 399–400.
103.
159) Rau (n 153 (/document/KLI-KA-AI-2018-03-003#n153)) 14–15.
103.
161) Rau (n 153 (/document/KLI-KA-AI-2018-03-003#n153))14–15. See also
Reuben (n 30 (/document/KLI-KA-AI-2018-03-003#n30)) 851.
162) Spahr v Secco 330 F.3d 1266 (10th Cir. 2003).
163) For a detailed discussion of the case, see Curtin (n 4 (/document/KLI-
KA-AI-2018-03-003#n4)) 1923.
164) Spahr (n 162 (/document/KLI-KA-AI-2018-03-003#n162)) 1273. The Tenth
Circuit Court upheld the District Court's decision. For a discussion of
both decisions, see Curtin (n 4 (/document/KLI-KA-AI-2018-03-
003#n4)) 1923–25.
165) See Curtin (n 4 (/document/KLI-KA-AI-2018-03-003#n4)) 1925.
166) This is consistent with the view expressed by numerous commentators
such as Weisenberger (n 156 (/document/KLI-KA-AI-2018-03-003#n156))
560.
167)
Spahr (n 162 (/document/KLI-KA-AI-2018-03-003#n162)) 1272–73. The
court explicitly disagreed with a previous decision of the Fifth Circuit
in Primerica Life Insurance Co v Brown, 304 F.3d 469, 472–73, (5th
Cir.2002) that held that the arbitrator is the appropriate person to
decide a mental capacity defence where it does not specifically relate

to the arbitration agreement . In Spahr, the court explicitly disagreed

with the conclusion in Primerica where the court declared, relying on
Prima Paint that 'unless a defence relates specifically to the
arbitration agreement , it must be submitted to the arbitrator as part
of the underlying dispute'.
168) Curtin (n 4 (/document/KLI-KA-AI-2018-03-003#n4)) 1925.
169) Spahr (n 162 (/document/KLI-KA-AI-2018-03-003#n162)) 1273.
170) Curtin (n 4 (/document/KLI-KA-AI-2018-03-003#n4)) 1927.
171) ibid 1936.
172) Hyundai Merchant Marine Company Limited v Americas Bulk Transport
Ltd [2013] EWHC 470 (Comm). For a discussion of this case see also, L
Williams, Backer and McKenzie International Arbitration Yearbook
2013–2014 (Juris 2014) 360; A Hill, 'Anti-Suit Injunctions—No
Requirement To Commence Arbitration' (2013) Legal Eye Arbitration 8,
1–3 <http://www.bristows.com/assets/documents/013.08.20%20-
%20Arbitration%20-%20August%202013.pdf
(http://www.bristows.com/assets/documents/013.08.20%20-
%20Arbitration%20-%20August%202013.pdf)> accessed 6 May 2018,
and M Berard, 'Severability Has Limits: Arbitration Clause Cannot Exist
Without Underlying Agreement' (Clifford Chance, 27 June 2013)
<http://www.cliffordchance.com/briefings/2013/06/severability_hasli
mitsarbitrationclaus.html
(http://www.cliffordchance.com/briefings/2013/06/severability_haslim
itsarbitrationclaus.html)> accessed 6 May 2018.
173) Hyundai Merchant Marine Company Limited (n 172 (/document/KLI-KA-
AI-2018-03-003#n172)), Eder J, para 36.
174) G Jones and P Pexton, ADR and Trusts: An International Guide to
Arbitration (Spiramus 2015) 146.
175) [2007] UKHL 40, [2007] 4 All ER 951, Lord Hope of Craighead, para 34.
176) The decision in Hyndai can also be viewed as an apparent exception to
the principle that courts will uphold arbitration awards. See Berard (n
172 (/document/KLI-KA-AI-2018-03-003#n172)).
177) See R Merkin and L Flannery, Arbitration Act 1996 (CRC 2014) 300.
178) Rau (n 153 (/document/KLI-KA-AI-2018-03-003#n153)) 2.
179) These arguments have been propounded for some time. See Reuben
(n 30 (/document/KLI-KA-AI-2018-03-003#n30)) 872–82. See generally,
Samuel (n 75 (/document/KLI-KA-AI-2018-03-003#n75)) 36. See also
Carl M Svernlov, 'What Isn't, Ain't: The Current Status of the Doctrine of
Separability' (1991) 8 Journal of International Arbitration 37–50, 37.
180) Pottow, Brege and Hawley (n 42 (/document/KLI-KA-AI-2018-03-
003#n42)) 201.
181)
For a detailed discussion of this principle in the US context, see

Stephen J Ware, 'Arbitration Clauses, Jury-Waiver Clauses, and Other

Contractual Waivers of Constitutional Rights' (2004) 67 Law and
Contemporary Problems 167–205. Another related application of the
doctrine is that the invalidity, illegality or repudiation of the
arbitration clause, for instance because its terms confer on one party
an unconscionably disproportionate influence for choosing the
arbitrators, does not necessarily impeach the matrix contract. See
Born (n 1 (/document/KLI-KA-AI-2018-03-003#n1)) 51.
182) Kreindler (n 62 (/document/KLI-KA-AI-2018-03-003#n62)) 22.
183) Haining and Zeller (n 149 (/document/KLI-KA-AI-2018-03-003#n149))
495.
184) David Wolfson, 'Publication Review of Agreements on Jurisdiction and
Choice of Law' (2010) 126 Law Quarterly Review 331–34, 332.
185) ibid 332. See also Shwetank Tripathi and Pallavi Verma, 'The Effect of
Invalidity of Underlying Contract on the Arbitration Clause: a Critique
on the Doctrine of Separability in Arbitration' The Practical Lawyer
(2011) S22, <http://www.supremecourtcases.com/index2.php?
option=com_content&itemid=1&do_pdf=1&id=22055
(http://www.supremecourtcases.com/index2.php?
option=com_content&itemid=1&do_pdf=1&id=22055)> accessed 6 May
2018; Simon Greenberg, Christopher Kee and J Romesh Weermantry,
International Commercial Arbitration: An Asia Pacific Perspective
(Cambridge University Press 2011) 156.
186) [2006] EWCA Civ 5.
187) Konkola Copper Mines Plc v Coromin Ltd [2006] EWCA Civ 5, para 99.
188) Barceló (n 41 (/document/KLI-KA-AI-2018-03-003#n41)) 1130. See also
generally, Adrian Briggs, Agreements on Jurisdiction and Choice of Law
(Oxford University Press 2008) 61–106.
189) Domenico Di Pietro, 'The Influence Of The New Law On Arbitration
Agreements And Arbitrato Irrituale' (2007) 10 International Arbitration
Law Review 18–25, 19.
190) For an extensive discussion of this issue in the context of relevant US
caselaw, see Curtin (n 4 (/document/KLI-KA-AI-2018-03-003#n4)) 1905–
37.
191) Reuben (n 30 (/document/KLI-KA-AI-2018-03-003#n30)) 844–45.
192) Okanigbuan (n 7 (/document/KLI-KA-AI-2018-03-003#n7)) 255; Ware (n
32 (/document/KLI-KA-AI-2018-03-003#n32)) 120.
193) Ware (n 181 (/document/KLI-KA-AI-2018-03-003#n181)) 167.
194)
Carl M Svernlov, 'The Evolution of the Doctrine of Separability in
England: Now Virtually Complete?' (1992) 9(3) Journal of International
Arbitration 115–21 . See also Susan H Blake, Julie Browne and Stuart

Sime, A Practical Approach To Alternative Dispute Resolution (2nd edn,

OUP 2012) 396.
195) Dundas (n 147 (/document/KLI-KA-AI-2018-03-003#n147)) 98, citing
Lord Hoffmann.
196) An arbitration agreement can also be deemed inoperative, if the
parties themselves have terminated the agreement as they are free to
revoke their arbitration agreement and choose to resolve their
dispute by some other means. For an overview of this issue, including
a discussion on the formative principles and jurisprudence, see M
Bonnell, 'When is an Arbitration Agreement “Inoperative”?'
International Arbitration Law Review (2008) 11(3) 111–17. In some cases,
an arbitration agreement can be rendered inoperative by the
operation of statutes. For example, under s 19 of the UK Insurance Act,
a party is given the option to decide whether or not they are to be
bound by the agreement. As a result, if a party decides not to be
bound by the agreement, then the arbitration agreement is said to
be inoperative. For a discussion of this issue in numerous jurisdictions
including Australia, New Zealand and Canada, see Bonnell (n 196
(/document/KLI-KA-AI-2018-03-003#n196)) 115–17.
197) Ware (n 32 (/document/KLI-KA-AI-2018-03-003#n32)) 121.
198) Reuben (n 30 (/document/KLI-KA-AI-2018-03-003#n30)) 845.
199) See Ware (n 32 (/document/KLI-KA-AI-2018-03-003#n32)) 121–22.
200) Adrian Briggs, 'Construction of an Arbitration Agreement ;
Deconstruction of an Arbitration Clause' [2008] Lloyd's Maritime and
Commercial Law Quarterly 1–5, 3.
201) Reuben (n 30 (/document/KLI-KA-AI-2018-03-003#n30)) 845–46.
202) Weisenberger (n 156 (/document/KLI-KA-AI-2018-03-003#n156)) 557.
203) International Chamber of Commerce, 'ICC Rules of Arbitration' (2012)
<http://www.iccwbo.org/products-and-services/arbitration-and-
adr/arbitration/icc-rules-of-arbitration...
(http://www.iccwbo.org/products-and-services/arbitration-and-
adr/arbitration/icc-rules-of-arbitration/)> accessed 6 May 2018.
204) London Court of International Arbitration, 'LCIA Arbitration Rules'
(2014) <http://www.lcia.org/Dispute_Resolution_Services/lcia-arbitra-
tion-rules-2014.aspx
(http://www.lcia.org/Dispute_Resolution_Services/lcia-arbitration-
rules-2014.aspx)> accessed 6 May 2018.
206) See for example Sojuznefteexport v Joc Oil Limited (1993) XVIII
Yearbook Commercial Arbitration 92. See also Born (n 9
(/document/KLI-KA-AI-2018-03-003#n9)) 454–56.
207)
See for example, Barceló (n 41 (/document/KLI-KA-AI-2018-03-

003#n41)) 1123.
209) Redfern and Hunter (n 1 (/document/KLI-KA-AI-2018-03-003#n1)) 106.
211) While both art II (3) of the New York Convention and the arts 8 and 16
of the UNCITRAL Model Law provide for courts to conduct a complete
review prior to the award being issued, the 'negative effect' of the
doctrine is recognized in many countries. See Ozlem Susler, 'The
English Approach to Compétence-Compétence' (2013) 13 Pepperdine
Dispute Resolution Law Journal 427–52, 427–28. For example, French
courts have adopted a policy of exclusive jurisdiction to the arbitral
tribunal, while English courts have vacillated in their approach to the
'negative effect', between rejection and support for it. In difficult cases
there seems to be a tendency to adopt the cautious approach of
making a ruling on jurisdiction prior to the tribunal. See Susler (n 211
(/document/KLI-KA-AI-2018-03-003#n211)) 445. See also Jones (n 40
(/document/KLI-KA-AI-2018-03-003#n40)) 59–64. See also Bermann (n
121 (/document/KLI-KA-AI-2018-03-003#n121)) 15–19.
213) David Owens, 'Choice of Law for Arbitration Agreements' (2013) 24
Construction Law 32. See also Lew, Mistelis and Kröll (n 1
(/document/KLI-KA-AI-2018-03-003#n1)) para 6-23–6-24; Gary Born,
International Commercial Arbitration: Commentary and Materials
(Kluwer Law International 2001) 68. See also the obiter dicta in Hamlyn
& Co v Talisker Distillery [1894] AC 202 HL, where it was stated that the
arbitration clause may be governed by a different law to the matrix
contract, and JOC Oil v Sojuznefteexport [1984] XVIII YBCA, where it was
stated that an arbitration clause is separate from the matrix contract
and that both are regulated by two different sets of laws.
214) Felix Sparka, Jurisdiction and Arbitration Clauses in Maritime Transport
Documents: A Comparative Analysis (Springer Science & Business
Media 2010) 93.
215) [1967] 2 Q.B 590,598 (CA).
216) Sparka (n 214 (/document/KLI-KA-AI-2018-03-003#n214)) 85. The
German Federal Court of Justice declined to give a decision on the fact
that a jurisdiction agreement may be governed by a different law than
the matrix contract. However, lower courts like the
Oberlandesgericht Bremen Court held that jurisdiction agreements
may be governed by a different law than the matrix contract. See
Sparka (n 214 (/document/KLI-KA-AI-2018-03-003#n214)) 86. The
doctrine of separability is contained in s 1040(1) of the German
Arbitration Act.
217)
David Joseph, Jurisdiction and Arbitration Agreements and Their

Enforcement (Sweet & Maxwell 2005) 108–109.
218) Tripathi and Verma (n 185 (/document/KLI-KA-AI-2018-03-003#n185))
S22.
219) Baron (n 44 (/document/KLI-KA-AI-2018-03-003#n44)) 50–66.
220) QH Tours Ltd v Ship Design and Management (Aust) Pty Ltd (1991) 104
ALR 371.
221) Okanigbuan (n 7 (/document/KLI-KA-AI-2018-03-003#n7)) 259.
222) This has been the contention of numerous commentators for some
time. See for example, N Kaplan, 'Is the Need for Writing as Expressed
in the New York Convention and the Model Law Out of Step with
Commercial Practice?' (1996) 12 Arbitration International 27–45, 45.
223) Ware (n 32 (/document/KLI-KA-AI-2018-03-003#n32)) 120–22; Alan S
Rau, '“Separability” in the United States Supreme Court' [2006]
Stockholm International Arbitration Review 1, 16.
224) Okanigbuan (n 7 (/document/KLI-KA-AI-2018-03-003#n7)) 259.
225) Susler (n 211 (/document/KLI-KA-AI-2018-03-003#n211)) 428. In
circumstances where this is not provided for in the agreement and the
arbitral tribunal makes a determination that one of the parties
believes is erroneous, art V 1(c) of the New York Convention provides
that the courts in the country of enforcement are entitled to review an
arbitral tribunal's decision on the question of jurisdiction. This
confirms the view that the tribunal's decision on jurisdiction, and
consequently severability, will never be final and binding. See Jones (n
40 (/document/KLI-KA-AI-2018-03-003#n40)) 63. For an interesting
discussion on the role of the courts in finding the appropriate balance
between promoting arbitration and ensuring that any order issued
compelling the process is supported by a valid and enforceable
agreement to arbitrate, see Bermann (n 121 (/document/KLI-KA-AI-
2018-03-003#n121)) 1–50.
226) See for example Okanigbuan (n 7 (/document/KLI-KA-AI-2018-03-
003#n7)) 255.
227) Professor Schlosser, referred to in Einhorn and Siehr (eds),
Intercontinental Cooperation Through Private International Law: Essays
in Memory of Peter E. Nygh (2004) 305, 323, as cited by Briggs (n 200
228) Briggs (n 200 (/document/KLI-KA-AI-2018-03-003#n200)) 4–5. See also
Briggs (n 188 (/document/KLI-KA-AI-2018-03-003#n188)) 473–522.
229) For example, see Prima Paint Corp v Flood & Conklin Manufacturing Co
(1967) 388 US 395, 402.
230)
Carl Svernlov, 'Arbitration: doctrines of “separability” of the arbitration
agreement and “competence de la competence” in English law'

(1992) 3 ICCLR C94–95.

208.
232) Di Pietro (n 189 (/document/KLI-KA-AI-2018-03-003#n189)) 23.
Claims that an arbitral

tribunal failed to deal
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arbitration agreement (91)

• 3. THE COMPETENCE–COMPETENCE RELATIONSHIP

4. CONFLUENCE AND CONFLICT IN THE DEVELOPMENT OF THE

• 5. ILLEGALITY AND CONSENT

Claims that an arbitral

Show section export checkboxes

Separability in international commercial arbitration;

The doctrine of separability in international commercial arbitration

https://www.kluwerarbitration.com/document/kli-ka-ai-2018-03-003?q=formation AND validity AND arbitration agreement 3/46

numerous jurisdictions around the world (15) as diverse as Canada, (16)

https://www.kluwerarbitration.com/document/kli-ka-ai-2018-03-003?q=formation AND validity AND arbitration agreement 4/46

to two separate agreements; the matrix agreement comprising their

3. THE COMPETENCE–COMPETENCE RELATIONSHIP

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the subject of a subsequent court challenge. (52) Under competence–

International and Institutional rules of arbitration usually elucidate the

Both competence–competence and separability enhance the efficiency of

4. CONFLUENCE AND CONFLICT IN THE DEVELOPMENT OF THE

circumstances where an agreement to arbitrate disputes is not completely

The question of whether the validity of an arbitration clause is separate

https://www.kluwerarbitration.com/document/kli-ka-ai-2018-03-003?q=formation AND validity AND arbitration agreement 8/46

Following Robert Lawrence, two of the most seminal US decisions in support

https://www.kluwerarbitration.com/document/kli-ka-ai-2018-03-003?q=formation AND validity AND arbitration agreement 9/46

English courts originally did not consider the separate nature of an

However, in Heyman v Darwins Ltd (97) the effect of a frustrated matrix

Despite some disparities, English courts have generally accepted the

https://www.kluwerarbitration.com/document/kli-ka-ai-2018-03-003?q=formation AND validity AND arbitration agreement 11/46

contrary to public policy or illegal. However, in that case, the arbitration

As can be seen from the above discussion, international arbitral tribunals

The autonomy and independence of the arbitration agreement is long

https://www.kluwerarbitration.com/document/kli-ka-ai-2018-03-003?q=formation AND validity AND arbitration agreement 12/46

valid despite the matrix contract being discharged, repudiated, illegal or

the separability principle and an arbitrator's power to determine if a

Similar to English courts, Australian Courts were initially reluctant to

https://www.kluwerarbitration.com/document/kli-ka-ai-2018-03-003?q=formation AND validity AND arbitration agreement 13/46

There are significant similarities in approach between Australian and

However, despite the consistency discussed above, there is divergence

5. ILLEGALITY AND CONSENT

arbitration agreement . (147) While allegations of non-existence do not

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It could be contended that instances concerning consent are not exceptions

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agreement in question, due to the party's lack of consent, the arbitration

Prior to Hyandai, courts had explicitly recognized that there would be

https://www.kluwerarbitration.com/document/kli-ka-ai-2018-03-003?q=formation AND validity AND arbitration agreement 18/46

relatedprinciple to separability, competence–competence, the capacity of

The arbitration agreement , it is believed, cannot be separated from the

capacity of the party when concluding the contract can be understandably

In such circumstances, where parties cannot avail of court relief, the

https://www.kluwerarbitration.com/document/kli-ka-ai-2018-03-003?q=formation AND validity AND arbitration agreement 20/46

This concern is revealed in the rules of prominent arbitral institutions, such

There is considerable variance in perspectives with regard to the link

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