The High Court has refused a construction company’s application to stay a homeowners’ claim and send the dispute to arbitration, finding that the company had repudiated the arbitration agreement and was estopped from relying on it.
Ms Justice Bolger delivered the judgment on 28 April 2023. The application was brought by Creedon Construction Limited, the second defendant in proceedings brought by Alan Kenny and Emma Claire Mullally. The homeowners allege defective construction work.
The dispute concerns a written building agreement dated 12 October 2012 for construction of the couple’s house at Silken Vale, Maynooth, County Kildare. Clause 23 provided for conciliation and, if that did not resolve a dispute, arbitration. The parties did not dispute that the current claim fell within the clause.
Creedon argued that Article 8(1) of the UNCITRAL Model Law required the court to refer the dispute to arbitration. It said it had applied before making a statement on the substance of the current dispute. The homeowners argued the clause was inoperative: Creedon had issued summary proceedings in May 2013 to recover money they allegedly owed, and its conduct and delay in the current case meant it could no longer invoke arbitration.
The judge found that the 2013 proceedings, which concerned a dispute also covered by the broad arbitration clause, amounted to repudiation of the agreement and that the homeowners had accepted that repudiation. She noted that the homeowners had not sought a stay of those proceedings at the time. In a 2014 judgment on Creedon’s application for summary judgment, the court had inferred that the parties had agreed the issues in those proceedings would be litigated.
The judge also considered Creedon’s conduct after the homeowners began the present proceedings. Creedon engaged with pleadings and arrangements for an engineer’s inspection, but did not raise arbitration until 9 June 2021, about 19 months after it was first informed of the case. The homeowners had sought a defence in May 2021. The judge held that this conduct further supported her conclusion that Creedon was estopped from relying on the clause.
She also cited potential prejudice: the time elapsed between the plenary summons in April 2019 and Creedon’s June 2021 arbitration request might allow the company to raise a limitation defence in arbitration. Creedon had reserved the right to raise such a defence if available.
The court refused the stay application. Justice Bolger’s indicative view was that the homeowners should receive their costs, with execution stayed until the proceedings are finally resolved. She listed the matter for mention on 12 May 2023 for submissions on final orders, including costs; the judgment does not state what final costs order was made.