Birse Construction Ltd v. St David Ltd (No. 1)

Citation: B.L.R. 57; 70 Con. L.R. 10

Nature of case:

Birse Construction had carried out work at the request of St David.  Having commenced the works, Birse left the site at a time when it was alleged by St David to be in default.  Despite having undertaken substantial negotiations, it was in dispute whether, prior to this point, any contract had been agreed.

Birse brought a claim seeking payment for the work they had carried out, and St David responded seeking a stay pursuant to section 9 of the Arbitration Act 1996, claiming that there was a contract and arbitration agreement.  The parties filed affidavit evidence in support of their respective positions on the existence of an arbitration agreement.

At the first instance hearing of St David’s application for a stay, HHJ Humphrey Lloyd QC had concluded that a contract had been agreed, on the basis of the affidavit evidence, and having proceeded on the understanding that the parties had asked him to decide the issue on that basis.  Birse appealed this decision, and by the time the case had reached the Court of Appeal, it was common ground that the parties had not agreed that the Judge could decide the issue on the basis of the affidavit evidence.

The majority of the Court of Appeal ruled that there had been no agreement that the fist instance judge could decide the point on the basis of affidavit evidence, and that in the absence of a clear agreement to that effect, the first instance judge was limited to deciding whether or not the affidavit evidence disclosed a triable issue, i.e. a genuine dispute of relevant fact.  The Court of Appeal further ruled that there was a triable issue on the affidavit evidence, and the case was remitted to the TCC to decide whether a contract had been agreed.

Counsel

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