SUPREME COURT OF QUEENSLAND
CITATION:
Lin & Anor v Lee [2021] QSC 336
PARTIES:
ZEJIAN LIN
(first plaintiff)
GANG LIN
(second plaintiff)v
JUNMIN LEE(defendant)
FILE NO/S:
BS No 11347 of 2021
DIVISION:
Trial Division
PROCEEDING:
Application
ORIGINATING COURT:
Supreme Court at Brisbane
DELIVERED ON:
17 December 2021
DELIVERED AT:
Brisbane
HEARING DATE:
10 December 2021
JUDGE:
Martin J
ORDERS:
1. The application is dismissed.
2. I will hear the parties as to costs.
CATCHWORDS:
CONTRACTS – GENERAL CONTRACTUAL PRINCIPLES – CONSTRUCTION AND INTERPRETATION OF CONTRACTS – INTERPRETATION OF MISCELLANEOUS CONTRACTS AND OTHER MATTERS – where the plaintiffs have commenced proceedings against the defendant alleging, among other things, breach of contract and negligence – where the contract includes a dispute resolution clause that the defendant argues is an arbitration agreement within the meaning of s 7 of the Commercial Arbitration Act 2013 – where the defendant applies for an order that the parties be referred to arbitration and the proceeding be stayed – whether cl 11 constitutes an arbitration agreement – whether the court must refer the parties to arbitration and, therefore, necessarily grant the stay under s 8 of the Commercial Arbitration Act 2013
Commercial Arbitration Act 2013, s 8
Uniform Civil Procedure Rules 1999, r 16Electricity Generation Corporation v Woodside Energy Ltd (2014) 251 CLR 640
Jemena Gas Networks (NSW) Ltd v AGL Energy Limited [2017] NSWCA 266
Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104COUNSEL:
MJ Henry for the applicant/defendant
RA Kipps for the respondents/plaintiffs
SOLICITORS:
Sung Do Lawyers for the applicant/defendant
Irish Bentley Lawyers for the respondents/plaintiffs
In 2014, the plaintiffs and the defendant entered into a contract (“the contract”) whereby the defendant agreed to provide services as a migration agent to the plaintiffs.
In September 2021, the plaintiffs commenced proceedings against the defendant alleging, among other things, breach of contract and negligence (“the proceeding”).
In October 2021, the defendant filed a conditional notice of intention to defend.
By this application, the defendant seeks orders that:
(a)the parties be referred to arbitration pursuant to s 8(1) of the Commercial Arbitration Act 2013 (“the Act”), and
(b)the proceeding be stayed pursuant to r 16(g) of the Uniform Civil Procedure Rules 1999.
The basis for the application is that the defendant has activated, what he argues is, an arbitration clause within the contract.
The relevant legislation
Section 7 of the Act provides the definition of arbitration agreement used in the Act:
“7 Definition and form of arbitration agreement (cf Model Law Art 7)
(1)An arbitration agreement is an agreement by the parties to submit to arbitration all or certain disputes which have arisen or which may arise between them in respect of a defined legal relationship, whether contractual or not.
(2)An arbitration agreement may be in the form of an arbitration clause in a contract or in the form of a separate agreement.
(3)The arbitration agreement must be in…
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- AGLC
- Lin v Lee [2021] QSC 336
- Case
- [2021] QSC 336
- Decision Date
CaseChat Overview and Summary
The court had to determine whether clause 11 constituted an arbitration agreement under the Commercial Arbitration Act 2013. If it did, the court would be required to refer the parties to arbitration unless it found that the agreement was null and void, inoperative, or incapable of being performed. The court examined the language of clause 11 and considered whether it clearly and unequivocally referred disputes to arbitration. The court also assessed whether the parties had intended to create a binding arbitration agreement. The court found that clause 11 did not constitute an arbitration agreement as it did not unequivocally refer disputes to arbitration. Instead, it required the parties to first attempt to resolve disputes themselves, only referring the dispute to arbitration if they failed to reach an agreement within 21 days.
Given that clause 11 did not constitute an arbitration agreement, the court did not need to refer the parties to arbitration or stay the proceedings. The court dismissed the defendant's application and noted that it would hear the parties regarding costs.
Orders
Orders of the court
1. The application is dismissed.
2. I will hear the parties as to costs.
Background
Background to the litigation
Full text does not contain this section.
Evidence
Evidence Before The Court
Full text does not contain this section.
Decision
Reasons for decision
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Ratio Decidendi
Legal Principle Established
Section 8 of the Act provides for the reference to arbitration:“8 Arbitration agreement and substantive claim before court (cf Model Law Art 8)(1)A court before which an action is brought in a matter which is the subject of an arbitration agreement must, if a party so requests not later than when submitting the party’s first statement on the substance of the dispute, refer the parties to arbitration unless it finds that the agreement is null and void, inoperative or incapable of being performed.(2)Where an action referred to in subsection (1) has been brought, arbitral proceedings may nevertheless be commenced or continued, and an award may be made, while the issue is pending before the court.”The relevant clauses in the contract The defendant argues that cl 11 of the contract constitutes an arbitration agreement within the meaning of the Act:“11. RESOLUTION OF DISPUTESa. If a dispute arises—out of or relating to this agreement, or the breach, termination, validity, or subject matter thereof, or as to any related claim in restitution or at law, in equity or pursuant to any statute—the parties agree to discuss the dispute with the aim of reaching an agreement that is acceptable to both sides. The agreement will be documented in writing, dated and signed by both the Agent and the Client.b. If one party requests an opportunity to discuss the dispute, the parties should attempt to reach an agreement within 21 days of that request (or a longer period if agreed between the parties).c. If the parties cannot reach an agreement within 21 days, the parties agree to refer the dispute to the Australian Commercial Disputes Centre (ACDC) for final settlement by a single arbitrator appointed in accordance with the Rules of the ACDC, or by another dispute resolution process suggested by ACDC and accepted by the parties. It is expected that any fees payable to ACDC or to the person appointed by ACDC will be paid by the parties equally.d. If the parties have been unable to resolve their dispute through ACDC, either party may commence Court proceedings but not before the expiry of 28 days from the date of referral to ACDC.e. A Client may vary the procedure set out in this clause if the Client can establish that DIAC may require the Client to depart Australia.” The plaintiffs argue that cl 12 constitutes an exclusive jurisdiction clause and prevents the defendant from relying on any arbitration agreement:“12. RELEVANT LAW AND JURISDICTIONa.These conditions and all aspects of the performance of our services for you are governed by, and you agree to be bound by, the law of the QLD and the Code of Conduct. The Client and Agent irrevocably submit to the exclusive jurisdiction of the courts of the QLD and/or the Migration Agents Registration Authority.” For the reasons which follow I do not need to decide that point.What must the defendant establish? The defendant must show that cl 11 in the contract is an arbitration agreement within the meaning of the Act. If that is done, this Court must refer the parties to arbitration unless the Court finds that the agreement is “null and void, inoperative or incapable of being performed”.