Lobb Partnership Ltd v Aintree Racecourse Company Ltd [QBD (Comm)]
| Jurisdiction | England & Wales |
| Judge | Colman J. |
| Judgment Date | 22 November 1999 |
| Court | Queen's Bench Division (Commercial Court) |
| Date | 22 November 1999 |
Queen's Bench Division (Commercial Court).
Colman J.
Simon Hargreaves (instructed by Cameron McKenna) for the claimant.
Simon Hughes (instructed by Winward Fearon) for the defendant.
The following cases were referred to in the judgment:
Guangdong Agriculture Co Ltd v Conagra International (Far East) Ltd [1993] ADRLJ 100
Lovelock (EJR) Ltd v ExportlesUNK [1968] 1 Ll Rep 163
Mangistaumunaigaz Oil Production Association v United World Trade IncUNK [1995] 1 Ll Rep 617
Star Shipping AS v China National Foreign Trade Transportation CorpUNK [1993] 2 Ll Rep 445
Westfal-Larsen & Co A/S v Ikerigi Compania Naviera SA (“The Messiniaki Bergen”)UNK [1983] 1 Ll Rep 424
Arbitration — Whether arbitration agreement ambiguous and void for uncertainty.
This was an application under s. 67 of the Arbitration Act 1996 for a declaration that there was no valid arbitration agreement between the parties and to set aside an arbitrator's decision that he had jurisdiction.
The agreement between the applicant architects and the employer, “ARCL”, provided that “disputes may be dealt with as provided in para. 1.8 of the RIBA conditions but shall otherwise be referred to the English courts”. Paragraph 1.8.1 of the RIBA conditions provided for any difference or dispute to be referred by either of the parties to arbitration by a person to be agreed between the parties or failing agreement nominated by the President of the Chartered Institute of Arbitrators. A dispute arose between the parties and ARCL gave notice requiring the dispute to be referred to arbitration. In the absence of agreement to that course, ARCL applied to the Institute for the appointment of an arbitrator. The architects challenged the jurisdiction of the arbitrator appointed by the Institute, arguing that both parties had to agree specifically to refer any particular dispute to arbitration. The arbitrator determined as a preliminary issue that he had jurisdiction and the architects applied to the court under s. 67 of the Arbitration Act 1996 for a declaration that the arbitrator had no jurisdiction on the basis that the arbitration clause, being permissive only, was ambiguous and void for uncertainty or required both parties to agree to arbitration. ARCL argued that the clause gave a party to a dispute the right to elect whether to bring his claim before an arbitrator or the court, and that that choice was binding on the other party in either case.
Held dismissing the application:
The arbitration clause contained no ambiguity and was valid. The second part of the clause was clearly concerned with what was to happen if neither party invoked the arbitration jurisdiction under the RIBA conditions. The mandatory aspect of that part was directed to English jurisdiction. If the clause had consisted simply of the first part, there would be little doubt that the meaning was that either party was to be entitled to refer a dispute to arbitration and that the other party would be bound to the reference. The clause did not require both parties to agree to a reference nor did it permit a party to elect unilaterally whether to arbitrate or litigate. The arbitrator was right on the preliminary issue that he had jurisdiction because the meaning of the clause was that if a dispute arose either party could refer it to arbitration and the issue had then to be referred and if neither party elected arbitration the issue was to be litigated in the English courts.
Colman J: Introduction
The applicants are architects. They were employed by the respondents (“ARCL”) under a contract dated 25 March 1999 to provide architectural services in relation to the construction of a new stand at Aintree Racecourse. ARCL allege that the architects permitted the costs of the project to increase and did so by reason of various branches of their professional duties as quantity surveyors and architects. A claim for damages of £1,041,000 has been notified by ARCL. On 31 March 1999 they gave notice requiring the disputes to be referred to arbitration and suggesting the names of two proposed arbitrators. On 22 April 1999 ARCL made a unilateral application for the appointment of an arbitrator to the Chartered Institute of Arbitrators. In so doing they stated that:
“An Agreement between the parties dated 25.3.1998 includes the provision that in the event of a dispute, either party may apply to the Chartered Institute of Arbitrators to appoint an Arbitrator in the matter.”
Immediately, the applicants” solicitors informed the solicitors for ARCL that they considered that, under the contract of 25 March 1999, both parties must specifically agree that a particular dispute be referred to arbitration before an arbitrator could have any jurisdiction over that dispute and, because the applicants had never specifically agreed to the reference to arbitration of the dispute in question, no arbitrator could have jurisdiction. In spite of the applicants” objections to jurisdiction, on 10...
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...where the other party insisted upon the English Court is unlikely to have been the parties' intention; cf the discussion in Lobb Partnership v Aintree Racecourse [2000] CLC 431 at pp.434–435 per Colman J. In the present case the Bank decided to have the dispute decided in England by commenc......
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Case Note
...at para 03.145. 28 See, eg, Innotec Asia Pacific Sdn Bhd v Innotec GmbH[2007] 8 CLJ 304; Lobb Partnership Ltd v Aintree Racecourse Co Ltd[2000] CLC 431; National Enterprises Ltd v Racal Communications Ltd[1974] Ch 251; Rashid v Wipro Ltd[2015] BCJ No 2599; Van Dorn Co v Bunge Industrial Ste......