Jivraj v. Hashwani

Jivraj (plaintiff) and Hashwani (defendant) were both members of the Ismaili community, which was made up of Shia Imami Ismaili Muslims. Jivraj and Hashwani entered into a joint-venture agreement for a global real estate business in 1981. The agreement contained an arbitration clause stating arbitration would be governed by English law. The agreement also stated that any disputes Jivraj and Hashwani were unable to resolve should be decided by a panel of three arbitrators, with each arbitrator required to be a respected member of the Ismaili community. In 1988 Jivraj and Hashwani agreed to end the joint venture and selected a panel of three Ismaili arbitrators to assist with dividing the venture’s assets. The majority of the joint venture’s assets were successfully divided by the panel, but some disputes remained unresolved. In 2008 Hashwani informed Jivraj that he was claiming over $4 million in damages and that he had selected Sir Anthony Colman as his appointed arbitrator. Although Colman was an experienced commercial court judge, he was not a member of the Ismaili community. Hashwani stated that he believed he no longer had to satisfy the Ismaili requirement because the provision violated the Employment Equality (Religion or Belief) Regulations (the regulations), which were passed in 2003 and prohibited religious discrimination in certain employment situations. Jivraj filed an action in commercial court, seeking a declaration that Colman’s appointment was invalid because it did not satisfy the terms of the agreement. The commercial court found that the religious requirement had not been invalidated by the regulations. Hashwani appealed. The court of appeals held that the religious requirement was invalid under the regulations and found that the entire arbitration clause was invalid. Jivraj appealed the decision on the invalidity of the religious requirement, and Hashwani appealed the decision on the invalidity of the overall contract.