The High Court has referred a dispute between Narooma Limited and the Health Service Executive (HSE) over a ventilator supply contract to arbitration and stayed the court proceedings. The decision addressed the route for resolving the dispute, not whether either party was right about the contract or the disputed claims.
The contract was signed on 27 March 2020, when the HSE agreed to buy 350 ventilators for €7,485,450. Narooma claimed payment was due on 30 March. The HSE did not pay, saying it needed confirmation that the ventilators were secured and that Narooma was authorised to supply the manufacturer’s products. The HSE later said it would not proceed and purported to rescind the contract, alleging misrepresentation. The judge made no finding on Narooma’s status as an authorised agent or distributor.
Narooma sued on 7 April 2020. Its claims included breach of contract and tort, alleging that the HSE damaged its economic interests and reputation. The HSE asked the court to refer the dispute to arbitration under clause 21 of the contract, which provided for disputes to be referred to the International Chamber of Commerce (ICC).
Narooma argued that the clause required further mutual consent before arbitration, and that references to outdated ICC rules and unspecified procedures made it ineffective. It also argued that the HSE had waited too long to seek arbitration, relying on disparaging comments allegedly made by an HSE solicitor before the case began. The judge made no finding on whether those comments were made.
The court held that the parties had already agreed in writing to arbitrate any dispute when they signed the contract. It found the clause broad enough to cover the pleaded contract and tort claims. The judge also held that the reference to former ICC rules did not defeat the agreement: the current ICC Arbitration Rules would apply. The court rejected the timing argument, finding that the alleged comments were not a formal statement to the court on the substance of the dispute.
A potential defamation claim was not part of the proceedings, so the judge did not decide whether it would fall within the arbitration clause. Nor did the court determine the merits of Narooma’s claims, the HSE’s defences, or the contract’s disputed payment terms. It ordered the parties to arbitration and stayed the proceedings. The precise terms of the final orders were listed for discussion on 1 July 2020.