The High Court has refused an application by Bowen Construction Limited and Somague Engenharia Sociedad Anonima, trading as Bowen Somague Joint Venture, to stay proceedings brought by Kellys of Fantane (Concrete) Limited over payment of a conciliator’s recommendation pending arbitration.
Mr Justice Brian J. McGovern delivered the judgment on 1 June 2017. Kellys brought the proceedings by summary summons, seeking a joint and several judgment for an amount left blank in the judgment. The claimed sum was the amount of a conciliator’s recommendation arising from disputes under a 2009 subcontract for paving and other works on the N7 Castletown to Nenagh Road Scheme.
The defendants had given notice of dissatisfaction with the recommendation. Kellys provided a bond from Ulster Bank Ireland DAC, which the defendants had approved, and referred the dispute to arbitration. The defendants accepted that the bond requirement had been met and that the matter was proceeding to arbitration. They argued, however, that Kellys had included additional heads of claim in its arbitration reference, so had not met the contractual requirement for referring the same dispute to arbitration. They sought a stay under Article 8(1) of the UNCITRAL Model Law on International Arbitration.
The judge said the parties’ agreement required payment of the recommended sum after a notice of dissatisfaction, provided a suitable bond was supplied and the dispute referred to arbitration. Any later arbitration award could require a partial or full refund if it found a lower amount due. The judgment does not state the amount of the recommendation.
The court accepted that the question of compliance with the recommendation was justiciable by the courts under a separate contractual provision. That provision allowed court proceedings to enforce a binding recommendation without further conciliation or arbitration. The judge said deciding that discrete payment issue did not interfere with the arbitrator’s continuing role in determining what, if any, money was ultimately due and whether the defendants were entitled to a refund.
The court did not determine the merits of the underlying claims or decide what amount was ultimately payable. It refused the defendants’ application to stay the proceedings under Article 8. Arbitration remained ongoing.