Held The Full Federal Court held that the primary judge, Gleeson J, failed to give the necessary 'liberal width' to the phrase 'any dispute under the deed', and as a result of that narrow construction, the primary judge was forced to examine individual disputes to ascertain whether each was 'governed or controlled' by the deed. The proper construction of arbitration agreements and the principles that apply, should be no different from those principles that apply to the construction and interpretation of written contracts. In that regard, the Full Federal Court held that: 'where one has relational phrases capable of liberal width, it is a mistake to ascribe to such words a narrow meaning, unless some aspect of the constructional process, such as context, requires it'' In particular, the words 'any dispute under the deed' could cover a broad range of disputes including a dispute as to the validity of the deed itself and that was held to be the objective intention of the parties to it. On that basis, Gleeson J's decision was reversed and the relevant disputes were held to be the subject of an arbitration agreement. Significance The decision clarifies the previous New South Wales Court of Appeal decision of Rinehart v Welker, which had created some confusion by its narrow interpretation of an arbitration agreement. The decision re-affirms the pro-arbitration stance we have seen in decisions such as WDR Delaware v Hydrox (2016) (FCA), Four Colour Graphics v Gravitas [2017] FCA, where a party's decision to arbitrate in a contract is paramount.
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About the author
Elliott has 10 years' experience running complex commercial disputes in Australia and Asia. He has expertise in both litigation in Australia and international / domestic arbitration in Asia and the UK. Elliott has been working in Singapore for the last 5 years where he has gained experience acting for a broad range of clients across all aspects of contentious commercial law, including large and small financial institutions, global energy and oil companies, restructuring firms and commodities trading houses.
To learn more about Elliott, visit Kemp Strang website.