Chapter 2 - Separability- Handbook on International Commercial Arbitration - Second Edition
It is well established that the agreement to arbitrate, albeit typically a clause in the larger commercial agreement, is separate and distinct (or severable) from the contract in which it is contained and may survive the failure of the underlying contract: it is a separate agreement in its own right. This will apply whether the main contract is avoided, a voidable contract is rescinded--or the main contract discharged by performance, frustration or breach unless the same grounds exist to avoid, rescind or discharge the, separate, agreement to arbitrate.
The doctrine of separability is also well established in international arbitration practice.1 There are, however, some grounds of invalidity which will affect the arbitration agreement and the main contract equally. These are essentially matters in which the contract itself was never entered into (for example, due to a forged signature or to the party which purported to sign lacking any authority to do so). Some cases have suggested that the same position will also arise where the contract had been obtained by duress, however, the opposite was held by the English court in El Nasharty v. J Sainsbury plc2 in which the alleged duress was not sufficiently related to the arbitration clause so as to impeach it.
Article 8 of the Model Law provides:
(1) A court before which an action is brought in a matter which is the subject of an arbitration agreement shall, if a party so requests not later than when submitting his first statement on the substance of the dispute, refer the parties to arbitration unless it finds that the agreement is null and void, inoperative or incapable of being performed.
(2) Where an action referred to in paragraph (1) of this article has been brought, arbitral proceedings may nevertheless be commenced or continued, and an award may be made, while the issue is pending before the court.