Joe Kelly (Partner) and Siobhán Kirrane (Associate), A&L Goodbody
In one of its first decisions under the Irish Arbitration Act 2010 (2010 Act), the Irish High Court has refused to grant an application which sought to stay High Court proceedings on the basis that a dispute was subject to an arbitration agreement.
On 11 November 2010, the High Court issued its judgment in Barnmore Demolition and Civil Engineering Limited v Alandale Logistics Limited and Ors. [2010] No. 5910P, a construction dispute arising in relation to works carried out at Dublin Airport. The court held that no arbitration agreement existed between the parties.
Ireland has adopted the UNCITRAL Model Law in its entirety and incorporates minimal amendments to the Model Law in the text of the Act. Article 8(1) of the Model Law provides that "a court before which an action is brought in a matter which is the subject of an arbitration agreement shall… refer the parties to arbitration unless it finds that the agreement is null and void, inoperative or incapable of being performed".
On the facts of the case, the court held that while there was an agreement in principle, there was no confirmation and acceptance by the respective companies to enter into a contract. The court held that for the purpose of this case it did not have to decide which standard of review was applicable as it was clear on a prima facie review of the evidence, that there was no arbitration agreement between the parties. Although the court said that it decided this point on the basis of a prima facie review of the facts, it appeared to review the facts in detail and it is questionable how much further a detailed review could have gone.
The court's analysis in making its decision is interesting in light of divergent views in other countries' interpretation and application of Article 8 of the Model Law. On the one hand, some countries, such as the United Kingdom and New Zealand, have held that a full judicial review of whether an arbitration agreement exists should be undertaken by the court. On the other hand, courts in some Canadian jurisdictions and Hong Kong have held that a prima facie review should be undertaken, and an arbitrator would then be able to decide whether he has jurisdiction under the doctrine of "kompetenz-kompetenz".
This is one of the first Irish court decisions which can be added to the growing body of international Model Law jurisprudence. This case has already been the subject of comment by international arbitration practitioner Gary Born, and it will be interesting to see how the Irish courts interpret provisions of the Model Law in any future applications.
Case: Barnmore Demolition and Civil Engineering Limited v Alandale Logistics Limited and Ors. [2010] No. 5910P