John Holland Construction & Engineering Pty Ltd

The case involves an application by John Holland Construction and Engineering Pty Ltd ("Holland") to terminate three arbitrations between it and Federal Building Industries Pty Ltd (in liquidation) ("FBI") pursuant to section 46 of the Commercial Arbitration Act 1990. Holland contends that it would be prejudiced by the delay in prosecuting the arbitration proceedings, which has spanned over seven years. The court also considered an application by Eastcoast Holdings Pty Ltd for leave to appear and be heard on Holland's application. Justice Wilson was tasked with deciding whether the court could terminate the arbitrations without removing the disputes into court, and whether the delay was inordinate and inexcusable, and likely to cause serious prejudice to Holland.

Justice Wilson determined that the court could terminate the arbitrations without necessarily removing the disputes into court. The court must be satisfied that the delay will give rise to a substantial risk of it not being possible to have a fair trial of the issues in the arbitration proceedings or is such as is likely to cause or to have caused serious prejudice to the other parties to the arbitration proceedings. The delay in this case was largely unexplained, but it was not characterized as inordinate or necessarily inexcusable. The inconvenience and expense associated with locating witnesses would not be such as to give rise to a substantial risk that a fair trial would not be possible or as to cause serious prejudice to Holland. Therefore, Justice Wilson dismissed the summons to terminate the arbitrations.

No order was made as to costs on the summons filed by Holland or FBI as Eastcoast, the party that conducted the response to Holland’s application, was not a party to the arbitrations and was heard on Holland’s summons only pursuant to leave granted on its own application.