Tianqi Lithium Kwinana Pty Ltd v MSP Engineering Pty Ltd [No 2]

(2020) 56 WAR 169; [2020] WASCA 201

Western Australia Court of Appeal

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Interrogate

Catchwords

1. Contract
2. › Construction contracts
3. › Dispute resolution clauses
4. › Arbitration clause with carve-out for enforcement of payments due
5. › Whether 'proceedings to enforce payment due under the Contract' refers to proceedings capable of summary determination
6. › Whether certified progress payments under cl 37.2 are 'payment due under the Contract'
1. Contract
2. › Construction contracts
3. › Payment regimes
4. › Certified progress payments
5. › Whether certified progress payment creates obligation to pay without recourse to equitable set-off
6. › Pay now argue later principle
1. Arbitration
2. › Stay of court proceedings
3. › Commercial Arbitration Act 2012 (WA), s 8(1)
4. › Whether proceedings brought in 'a matter which is the subject of an arbitration agreement'
5. › Characterisation of the 'matter' in court proceedings
6. › Whether s 8(1) applies where arbitration agreement permits but does not require arbitration
1. Arbitration
2. › Stay of court proceedings
3. › Burden and standard of proof on stay application
4. › Whether applicant must establish on balance of probabilities or prima facie that matter is subject of arbitration agreement
5. › Whether court should assess merits or sustainability of defence
6. › Commercial Arbitration Act 2012 (WA), s 8(1)

Quick Take

A contractual clause preserving the right to 'institute proceedings to enforce payment due under the Contract' (such as cl 42.4 of AS4902-2000) refers to proceedings capable of summary determination — that is, proceedings in which there is no objectively triable issue. Where certified progress payments are undisputed as to validity of certification and no equitable set-off is available, the claim falls within the carve-out and is not required to be referred to arbitration under s 8(1) of the Commercial Arbitration Act 2012 (WA). Section 8(1) only mandates referral where the arbitration agreement requires (not merely permits) the dispute to be submitted to arbitration.