Under the International Arbitration Act 1974 (Cth), s 7, the court must mandatorily stay proceedings and refer to arbitration once the prerequisites are satisfied, and this mandatory obligation prevails over any discretion afforded by the Commercial Arbitration Act 1986 (Tas), s 53. Service of a notice of material breach and claim of termination does not constitute an election or waiver of the right to arbitrate where the arbitration clause is mandatory. A party not bound by the arbitration agreement cannot be compelled to have its proceedings stayed, and the court's inherent jurisdiction should not be exercised to defeat statutory arbitration rights or to preclude a non-party from enforcing its rights.
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