The High Court has granted Kellys of Fantane (Concrete) Limited summary judgment requiring Bowen Construction Limited and Somague Engenharia Sociedad Anonima, trading together as Bowen Somague Joint Venture, to pay a sum recommended by a conciliator pending arbitration. The judgment does not determine what amount, if any, is ultimately due under the contract.
Mr Justice Brian McGovern delivered the ruling on 31 July 2017 in the Commercial list. The plaintiff had agreed to carry out paving and other works under a 2009 agreement connected with the N7 Castletown to Nenagh Road Scheme. The contract required disputes to go to conciliation before arbitration and provided that, where a party gave notice of dissatisfaction, the recommended sum was to be paid if the other party referred the dispute to arbitration and provided a suitable bond.
The plaintiff sought payment under a conciliator’s recommendation dated 15 December 2015. The defendants accepted that the plaintiff had provided the required bond, but argued that its arbitration referral included additional claims and therefore did not concern the “same dispute”. The judge said the notice to refer conferred jurisdiction on the arbitrator and defined the dispute. He also held that whether the claim before the arbitrator was the same was a matter for the arbitrator.
The defendants also relied on the subcontract’s termination provisions. They said the subcontract had been terminated following an alleged default by the plaintiff and that the provisions postponed further payment. The plaintiff did not contest that the subcontract was terminated. The judge held that the plaintiff was seeking to enforce the separate payment obligation under the contract’s conciliation clause, not a payment under the termination clause. The effect of the termination value and amount remained for the arbitrator.
The judge rejected the argument that summary judgment would intrude on the arbitrator’s role. He said the recommended sum could later be varied or cancelled by the arbitrator, and that the court’s task was limited to deciding whether it had to be paid on account in the meantime. He found that the defendants had not established a bona fide defence and that the plaintiff was entitled to the relief sought.
The judgment states that the sum would be held pending arbitration and the arbitrator’s decision. The source does not state the amount of the conciliator’s recommendation or set out the formal terms of the order.