IRISH HIGH COURT ALLOWS LITIGATION TO PROCEED DESPITE ARBITRATION CLAUSE IN CONTRACT

Kelliher & Associates were recently involved as quantity surveyors in providing an expert opinion in respect to the cost appraisal of works carried out on a domestic property project under which a dispute had arisen between the contractor and their employers. 

The contractor sued the employer for monies owed and took an application for summary judgement to the High Court in 2014. The case was interesting for a number of reasons but in particular the fact that despite the existence of an Arbitration clause in the Contract, court proceedings were commenced and the court whilst refusing the application for summary judgement (as it considered the employer had established a prima facie defence to the summary proceedings), referred the case to a plenary hearing on the basis that no objection to litigation appeared to have been raised by either side to that juncture.

It was noted by Mr Justice Barrett in conclusion that the parties might be better advised to consider whether some alternative resolution can be achieved rather than a costly court process but they remained free to proceed to plenary hearing should they wish.

The parties proceeded down the litigation route and did not engage in any alternative dispute resolution process. The case went to a full plenary hearing in November 2016 nearly four years after the dispute had arisen. 

Kelliher & Associates expert report was relied heavily upon by the defendants both in the summary judgement defence and in the later successful defence to the litigation of the issue.

The case highlights the importance of and the need to have an early objection to litigation where an Arbitration clause is in existence and to be later relied upon. 

Creedon Construction Limited v Kenny & Anor [2014] IEHC 188