Arbitral Award on Validity of a Covenant in Restraint of Trade (India)
This template provides a formal arbitral award concerning a dispute over a covenant in restraint of trade under Indian law. It outlines the arbitrator's decision on whether a non-compete clause is reasonable and valid, including directions for the breaching party to cease operations and pay assessed damages.
ARBITRAL AWARD ON DISPUTE AS TO VALIDITY OF COVENANT IN RESTRAINT OF TRADE
[Reciting that by an assignment made the _______ day of ___________
Between
______________________________ (insert name, address etc. of party) of the one part
AND
________________________ (insert name, address etc. of party) of the other part the said (ONE PARTY) assigned (inter alia) the goodwill of the business of _________ theretofore carried on by him at ________ Street in [the City of] unto the said ( OTHER PART ). and thereby covenanted that he would not [recite the covenant shortly] And reciting that the said ( ONE PARTY ). contended that the said covenant was unreasonable and void and had commenced to carry on business at ______________ in [the City of] in breach of the terms thereof And reciting agreement to refer question of the validity of the said covenant and all other questions between the parties to arbitration.] Now I do find and adjudge that the hereinbefore recited covenant is having regard to the nature and extent of the business heretofore carried on by the said (ONE PARTY) reasonably necessary for the protection of the goodwill as assigned as aforesaid and is valid and I direct that the said (ONE PARTY) do forthwith cease to carry on the said business so commenced by him in breach of such covenant and I assess the damages in respect of the continuing breach thereof up to the date of this my award at the sum of Rs. ___________ And I direct payment of the said sum of Rs. _________ to be made to the said (OTHER PART). at the office of his solicitor __________ in _______ within one month of the date hereof.
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About this template
What is this template?
This is a formal arbitral award template specifically for Indian jurisdictions. It is not a contract but a quasi-judicial decision that includes specific sections for witness testimony summaries and legal reasoning regarding restraint of trade.
When should you use it?
Use this template when an arbitration tribunal needs to issue a final ruling on the enforceability of a post-termination non-compete clause. Use a Settlement Agreement instead if the parties reach a compromise before the award is issued.
What's inside
| Clause | Name | What it does |
|---|---|---|
| Recitals | Background and Dispute | Lists the specific employment agreement date and the specific restrictive clauses that led to the arbitration proceedings. |
| Section 1 | Terms of Reference | Defines the scope of the arbitrator's authority to decide on the legality of the covenant under Indian law. |
| Findings | Validity of Restraint | Evaluates the restriction against Section 27 of the Indian Contract Act 1872 to determine if it is void. |
| Analysis | Reasonableness Test | Analyzes whether the geographic scope and time duration of the non-compete clause are reasonable for protecting legitimate business interests. |
| Final Order | Award and Costs | States the final decision on the clause's enforceability and allocates the arbitration fees between the claimant and respondent. |
Who it's for
- an arbitrator presiding over an employment dispute in India involving non-compete clauses
- legal counsel drafting a proposed award for a tribunal regarding Section 27 of the Indian Contract Act
- a company seeking to understand how restrictive covenants are adjudicated in Indian arbitration
How long it runs and how it's signed
Law it's drafted under
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