Cheshire Contractors Pty Ltd v Civil Mining and Construction Pty Ltd

Cheshire Contractors Pty Ltd and Civil Mining and Construction Pty Ltd were involved in a contractual dispute related to roadwork construction. Cheshire, the sub-contractor, alleged that it was required to complete work and incur additional costs beyond that contemplated by the original agreement, and that it was owed money for this additional work. Cheshire also claimed that Civil Mining and Construction Pty Ltd should be estopped from denying Cheshire's entitlement to reasonable additional remuneration or damages or compensation under the Australian Consumer Law for loss suffered as a result of Civil Mining and Construction Pty Ltd's alleged unconscionable conduct. The court had to determine whether the matter should be referred to arbitration and whether the proceeding should be stayed.

The court concluded that the matter should be referred to arbitration as per section 8 of the Commercial Arbitration Act 2013 (Qld). The court also found that Cheshire's claim did not rely on the contract and rather arose by operation of law outside the contract. However, the court held that the claim still had a sufficiently close and consequential connection with the contract, making it a matter which was subject to the arbitration clause. The court further held that the stay of the proceeding would safeguard the integrity of the reference and could ground an application to lift the stay if the dispute could not be determined by arbitration.

The court made the following orders: 1) The parties are referred to arbitration pursuant to s 8(1) Commercial Arbitration Act 2013 (Qld); 2) Cairns Supreme Court proceeding 571/20 is stayed; and 3) The parties will be heard as to costs if costs have not been agreed in the meantime. The court also allowed out-of-town parties to appear by telephone or video-link.