The High Court extended the time for On-Site Welding Services Limited to commence arbitration with Quinn Insurance Limited (in administration), giving the company one week from 23 May 2011. The company must also pay Quinn’s costs of the court application, with those costs to be taxed if the parties cannot agree.
The dispute concerns Quinn’s refusal to indemnify On-Site Welding under an employer’s liability policy. The company sought an extension under section 45 of the Arbitration Act 1954 after missing the policy’s nine-month deadline for referring disputes to arbitration. Quinn argued that the court lacked jurisdiction because the 1954 Act had been repealed.
Justice Laffoy rejected that jurisdictional objection. She held that the company’s right to seek an extension had arisen before the 2010 Act took effect, so the repeal did not prevent the application. Any arbitration begun under the extension would be governed by the 2010 Act.
The underlying insurance dispute follows a personal injuries claim by Thomas Bateson, who says he was injured in an accident at a Drogheda site on 6 June 2006 while working as a pipe fitter. On-Site Welding was a subcontractor at the site. The judgment records competing accounts of when the company learned of the incident and when its director received the policy terms. The judge said those conflicts could not be resolved on this application and would be for an arbitrator if the case proceeded.
Quinn denied cover in March 2009, saying the company had breached a policy condition requiring prompt notification of incidents. The court did not decide whether that denial was justified, whether the notification condition had been breached, or whether First Ireland Risk Management was Quinn’s agent. Justice Laffoy also rejected the argument that potential hardship to Bateson should determine the extension application: the statutory test concerned hardship to the applicant seeking arbitration.
The judge found that refusing more time would cause undue hardship to On-Site Welding and its officers, given the company’s lack of assets and the possibility of a damages award in the separate personal injuries proceedings. She also found Quinn would not be prejudiced by the extension. The court declined to make the extension conditional on the company giving security for Quinn’s arbitration costs, leaving that issue to the arbitrator if Quinn pursued it. It also declined to bar On-Site Welding from seeking its arbitration costs if successful, leaving allocation of those costs to the arbitrator.