The High Court ruled that an arbitrator appointed in a construction dispute involving Achill Sheltered Housing Association CLG was invalidly appointed because the contractual steps required before arbitration had not been met.
In a judgment delivered on 12 January 2018, Mr Justice Brian McGovern granted the association’s application under Article 16(3) of the UNCITRAL Model Law. He held that the arbitrator, Donogh O’Riordan, did not have jurisdiction to arbitrate the claim brought by Dooniver Plant Hire Limited, and that his preliminary ruling that he had been validly appointed was wrong.
The dispute arose from a 2008 contract for six houses, a laundry building and related site works at Cuan Aoibhinn, Keel, Achill, County Mayo. The contract price was €1,241,988.04, subject to adjustments under the contract. After a notice of dispute in March 2011, further dispute notices were sent in February and March 2012. The court said the matters referred to conciliation were those raised in March 2011, while the later notices raised different issues, including the employer’s deduction of liquidated damages. The February and March 2012 matters had not been referred to conciliation.
The contract required disputes to be referred to conciliation before arbitration. Although the conciliator issued a recommendation in February 2012 on the earlier dispute, it did not cover the matters in the later notices. The applicant rejected the recommendation. Dooniver Plant Hire did not ask for an arbitrator to be appointed until 2 August 2016. The judge found that the delay of almost four and a half years breached the contract’s requirement to act expeditiously; no explanation for the delay was offered to the court.
The arbitrator had ruled in a letter dated 8 May 2017 that he had been validly appointed and said he would continue the arbitration while the court challenge was pending. The judge held that Article 16(3) allowed the court to review that preliminary ruling and the validity of the appointment. Because the contractual conditions for appointing an arbitrator had not been satisfied, the judge granted the orders sought by the association.
The ruling concerned the appointment and jurisdiction of the arbitrator. The judgment did not decide the underlying construction claim.