What happens to an Israeli arbitration if one of the parties dies?

Section 4 of the Arbitration Law states that an arbitration agreement is not revoked by the death of a party and continues to bind that party's successors, unless the parties expressly agreed it would lapse on death. In practice the arbitrator suspends the proceedings on learning of the death and waits for the estate to be represented by an administrator, an executor, or the heirs once a succession or probate order issues. The estate's representative inherits the deceased's procedural position, including its claims, defenses, and any duty to pay the arbitrator's fees. The arbitrator retains authority to manage the timetable and can extend the period for making the award to accommodate the substitution.

For a foreign party in an Israeli arbitration, a counterparty's death means delay rather than collapse, but the delay can be substantial because nothing proceeds until the Israeli estate is formally represented. If the deceased was the claimant, the heirs must decide whether to pursue the claim; if the deceased was the respondent, the estate defends and any award is enforced against estate assets, not against the heirs personally beyond what they inherit. Press for an early case-management ruling fixing a deadline for the estate to appoint a representative, and confirm that the arbitration agreement does not contain a clause terminating it on death. Keep proof of the arbitrator's appointment and the agreement, since the estate may challenge continuation. Our overview of the arbitration process in Israel sets out the procedural framework.

From the full guide: The Arbitration Process in Israel

← Browse all Q&A