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Subodh (Service)     03 February 2009

Agreement for services


While vetting an agreement, there is a clause which reads as:

"The Parties further hereby waive any right to a trial by jury with respect to any lawsuit or judicial proceeding arising or relating to this Agreement."

How far is this clause acceptable? Who is jury? Is it applicable in India?



 8 Replies

Jaydeep Kurup (ACS, LLB)     04 February 2009

As per Section 28 of the Indian Contract Act, 1872, any agreement by which any party thereto is restricted absolutely from enforcing his rights under the contract by legal proceedings in the ordinary tribunals is void.

Thus under Contract Act, parties can by a contract decide a particular jurisdiction but they cannot waive the rights to legal proceedings.



ravikumarbcombl (advocate)     04 February 2009

Exactly Mr.Jaydeep is correct, the clause waiving the right to trial means restricting the legal enforceability of the agreement hence  it is void u/s.28 of contract Act.

N.Ramakrishnan (Advocate/ Senior Partner)     05 February 2009

Dear Subodh,

At the outset, the method of trial by jury is no longer prevelant in India. It was in existence during the British Period and even for a few years thereafter. The said clause must have been inserted by a lawyer based in a country where trial by Jury is still in existence. I agree to disagree with my other friends that the same amounts to a restriction as contemplated under the Indian Contract Act. A restrictive clause in respect of a legal process which is not in vogue in the country is void ab initio. Therefore the question of restriction does not arise.

Your query does not indicate as to whether this is an International Agreement. If it is so, you have to check as to whether the laws of the other country permit such restriction. If it is a local agreement, then this clause can be deleted as it has no relevance.

Thanks, Ramakrishnan Adv 

Joy Dey (Advocate)     09 February 2009

Mr. Ramakrishnan has summed up the issue quite accurately. The question remains whether the parties, or even any of the party resides in a jurisdiction where jury system still prevails. IN such case the clause may gain some relevance. Otherwise, for a local Indian agreement, the clause is irrelevant.



Ashey   01 April 2009

I agree with Mr. Joy

Prabhat Kumar (Advocate)     02 April 2009

Law is settled in this regard. The agreement between 2 parties cannot oust the rights conferred by statute.

abhijit (legal )     23 August 2009

is there an arbitration clause following the above clause?

Theja (Lawyer)     02 November 2009

I agree with Mr. Jayadev. Provisions like this are detrimental to the interests of both the parties.

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