InfraShore Pty Ltd v Health Administration Corporation

InfraShore Pty Ltd, the plaintiff, brought an action against Health Administration Corporation, the defendant, before the Supreme Court of New South Wales. The dispute pertains to a contractual matter which the defendant seeks to have referred to arbitration under the Commercial Arbitration Act 2010 (NSW). The defendant argues that the plaintiff’s action should be stayed and the parties referred to arbitration, pursuant to section 8 of the Act, because the matter is the subject of an arbitration agreement. The plaintiff contends that either the matter is not subject to the arbitration agreement or that the agreement is inoperative with respect to it.

The court was required to determine whether the plaintiff's action fell within the scope of the arbitration agreement between the parties. Specifically, the court needed to ascertain whether the action was in a matter that is subject to the arbitration agreement as required by section 8(1) of the Commercial Arbitration Act 2010 (NSW). This involved interpreting the terms of the arbitration clauses in the contract and the expert determination agreement to determine whether they conferred a right to require arbitration on either party. The court had to decide if the language of the clauses, both literally and by implication, supported the defendant's contention that the present dispute must be arbitrated.

The court found that the arbitration clauses did not confer on either party the right to require arbitration in the circumstances presented. The terms of the clauses, both in their ordinary meaning and by implication, did not support the defendant’s interpretation. Therefore, the court concluded that either the plaintiff’s action was not in a matter subject to the arbitration agreement or that the agreement was inoperative with respect to it. Consequently, the court held that the plaintiff's action should not be stayed and referred to arbitration. The court further noted that, pursuant to section 5 of the Act, no court must intervene in matters governed by it except where expressly provided. Given that the conditions for referral to arbitration were not met, the court did not refer the matter to arbitration.

As a result, the court dismissed the defendant's application for an order under section 8(1) of the Commercial Arbitration Act 2010 (NSW). The plaintiff’s action was permitted to proceed in the court.