Turner & Goudy v McConnell
| Jurisdiction | England & Wales |
| Judge | LORD JUSTICE DILLON,MR. JUSTICE MUSTILL |
| Judgment Date | 21 February 1985 |
| Judgment citation (vLex) | [1985] EWCA Civ J0221-4 |
| Docket Number | 85/0990 |
| Court | Court of Appeal (Civil Division) |
| Date | 21 February 1985 |
and
[1985] EWCA Civ J0221-4
Lord Justice Dillon
and
Mr. Justice Mustill
85/0990
1984 T. NO. 805
IN THE SUPREME COURT OF JUDICATURE
COURT OF APPEAL (CIVIL DIVISION)
ON APPEAL FROM THE HIGH COURT OF JUSTICE
QUEEN'S BENCH DIVISION
(HIS HONOUR JUDGE SIR WILLIAM STABB, Q.C., sitting as a Deputy Judge of the Queen's Bench Division)
Royal Courts of Justice.
MR. JEREMY CAREY (instructed by Messrs. Calvert Smith & Sutcliffe of Richmond) appeared on behalf of the Appellants.
MR. MARK LOWE (instructed by Messrs. Bowles & Co. of Epsom) appeared on behalf of the Respondents.
This is an appeal by the plaintiffs against a decision of His Honour Judge Sir William Stabb, sitting as Judge in Chambers of the Queen's Bench Division. The appeal is by leave of the judge. The judge's order, which was made on the 26th July, 1984, dismissed an appeal by the plaintiffs against an order of Master Topley, which ordered a stay of the action on application by the defendants under section 4 of the Arbitration Act 1950.
The point at issue is whether there was any jurisdiction to order such a stay which turns on whether, before the application for the stay, the defendants had taken a step in the action.
The plaintiffs are builders and, by contract with the defendants, they built a house for the defendants on land which belonged to the defendants. The building contract contained the usual form of arbitration clause. The plaintiffs' claim in the action is for payment of the balance of their final account, interim payments to a very substantial sum having already been made by the defendants on architects' certificates, but the final account not having been certified by the architects.
The history of the proceedings is as follows. The writ was issued on the 30th March, 1984 and served on the defendants on the same day. The defendants entered an acknowledgement of service on the 10th April, 1984 stating their intention to defend the action. Thereafter a summons for summary judgment was issued by the plaintiffs on the 17th April, 1984 with the usual affidavit in support. This was returnable before the Master in Chambers, who, in the event, was Master Topley, on the 3rd May, 1984. On the 27th April, 1984 the defendants' solicitors sent to the plaintiffs and filed an affidavit of a partner in the firm, a Mr. John Graham Williams, in opposition to the Order 14 summons. This sets out at some length the history of the defendants' complaints, including difficulties with their architect, and complaints about delay in the completion of the house. In paragraph 5 there is mentioned in passing that the contract contains an arbitration clause, and the deponent says:
"I invite consideration to be given as to whether it is more appropriate this claim should be dealt with by way of RIBA arbitration in accordance with the provisions of [the arbitration clause]."
Then in paragraph 6 there is a reference to the possibility of litigation between the defendants and the architect, either in a separate action or "by bringing him into these proceedings." Paragraph 7 refers to the delay in completion, and ends up by saying:
"It is anticipated therefore that the Defendants will be counter-claiming against the Plaintiffs in respect of these matters."
Then the affidavit sets out that the defendants "are not satisfied they have been properly charged", and it also sets out that they are dissatisfied with the quality of the plaintiffs ' work. Paragraph 12 then says:
"I submit that the reasons referred to aforesaid justify the Defendants' wish to contest this claim. It must be considered whether or not the claim should be arbitrated. The Defendants will wish to defend and I anticipate also counter-claim. It will be necessary for the Plaintiffs to set out their claim properly and clearly, in Schedule form and for individual items to be investigated."
Then in paragraph 13 it is said:
"The Defendants wish to emphasise that they are not seeking to avoid their proper obligations' in this matter."
Then it is said:
"…as evidence of their bona fides the Defendants would be prepared, if so required, to bring the amount of the claim into Court, to abide the event."
Payment into court of course is consistent with the continuation of the proceedings rather than with reference to arbitration.
The summons came before the master on the 3rd May, the first return date. The affidavit of Mr. John Graham Williams, having been filed, was duly before the master. He had read that affidavit and the affidavits in support of the summons for judgment under Order 14; and, without any substantial argument, taking the view that the matter was not one to be heard without a special appointment, obviously because it was a summons for judgment which was opposed by the defendants, he adjourned the summons to a private room appointment. Thereafter the matter was placed in counsel's list, and some considerable time thereafter, on the 25th June, 1984 or possibly a day or so later, the defendants issued their summons applying for a stay of all further proceedings in the action pursuant to section 4. As I have indicated, the master granted a stay on that summons, and Sir William Stabb dismissed the plaintiffs' appeal from the master's decision but gave the plaintiffs leave to appeal to this court.
There are two other factors which can be mentioned. The first is that one may suspect from that history that the solicitors acting for the defendants may not have been aware of the statutory provisions of section 4 under which the application for a stay has to be made before any step in the action is taken by the defendants. The second is that a decision of this court in Northern Regional Health Authority v. Derek Crouch Construction Co. Ltd. [1984] 2 All England 175 was first reported in the course of May 1984, and that made it plain to the defendants that there were great advantages to them in proceeding by arbitration rather than in an action in the High Court in that the decision had laid down...
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