Regarding the termination of a business agreement defining a joint venture
Given the following parameters I would highly appreciate answers to the below questions:
- text in quotes is text that is written exactly as in the agreement in question.
- The phrase TerminatingCompany refers to the company that terminated the agreement.
Parameters of the scenario:
(A) The agreement contains a clause called “Agreement termination, penalty requirement”. That clause defines a penalty and specific costs that “TerminatingCompany is required to provide”.
(B) This clause has no mention of whether individual clauses or the agreement become null and void upon termination.
(C) This clause has no mention of whether the penalty and costs discussed are the “sole and exclusive” remedy to the non-terminating party.
(D) This clause does not have a standard phrase on how the termination affects “rights and obligations that have arisen or accrued prior to the date of termination”. But it does contain a phrase stating that TerminatingCompany “is required to pay for any obligations that the joint venture has entered into and has to pay for”.
Suppose the TerminatingCompany and non-terminating party go into arbitration
to settle what is due from the TerminatingCompany, what should a fair arbitrator conclude in regards XXXXX XXXXX following questions?
(1) Should the arbitrator conclude that the agreement is “null and void from the date of termination and onwards”? (see e.g. item B above).
(2) Should the arbitrator conclude that all clauses in the agreement, and not just the termination clause, should be considered when assessing the obligations that the joint venture has entered into while the agreement was in force? (see e.g. items C and D above).
(3) Should the arbitrator conclude that the cost to the TerminatingCompany can go beyond the penalty and specific costs defined in the termination clause? (see e.g. items A, C, D & 2 above).