Husband Can be Held Liable for Wife’s Stock Market Debt based on Oral Contract: Supreme Court

The Supreme Court upheld an arbitral award against a husband, ruling that his oral undertaking to share liability for his wife's demat account falls within the scope of the arbitration clause. 

Oral contracts in stock market transactions are enforceable and can impose joint and several Liability. 

The dispute arose when AC Chokshi Share Broker Pvt. Ltd. initiated arbitration over a ₹1.18 crore debit balance in the wife's trading account. 

The Court overturned the High Court's decision, emphasising that the husband's active participation in transactions created an implied agreement. 

It held that arbitration could be invoked against non-signatories under Bye-law 248(a) of BSE Bye-laws, 1957. 

Hence, an appeal was allowed.