Owain Rhys James has been granted permission to appeal the dismissal of an application for a stay of proceedings pursuant to Section 9 of the Arbitration Act 1996. He acted for the Appellant at first instance (then as the Applicant) and at the first appeal before HHJ Vosper QC. Permission has now been granted for a second appeal to proceed to the Court of Appeal.
The central issue is whether silence in the face of a demand for payment is sufficient for a dispute to arise. Further, the Court will be required to consider whether there must be an actual dispute, as opposed to a mere inability to pay, administrative error leading to silence, or a fanciful challenge to the sum demanded. The issues go to the heart of when there is a “dispute or difference” such that court proceedings ought to be stayed in favour of arbitral proceedings.
Granting permission to appeal Lewison LJ held that “whether silence in the face of a demand amounts to a dispute is an important [question]”. Further he agreed with the grounds of appeal in so far as “the order for directions appears to contemplate the existence of a dispute otherwise disclosure and witness statements would not have been needed.”
The proceedings before the County Court have been stayed and the appeal expedited.
The issues touch upon the judgment of Jackson J (as he then was) in Amec Civil Engineering Ltd v Secretary of State for Transport [2004] EWHC 2339 (TCC) and subsequently adopted by the Court of appeal in [2005] EWCA Civ 291. The issues were further dealt with in Wealands (Widow and Administratix of the Estate of Wealends (Dec’d) v CLC Contractors Ltd [2000] 1 All ER (Comm) 30; Halki Shipping Corp v Sopex Oils Ltd [1998] 2 All ER 23, [1998] 1 WLR 726; Collins (Contractors) Ltd v Baltic Quay Management (1994) Ltd [2004] EWCA Civ 1757.