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Validity of Arbitration Notice – Abandoned Claims

Indescon Ltd v Ogden (QBD, 20 August 2004)

Indescon applied to the court for a declaration as to the validity of an arbitration notice given 10 years prior to the appointment of an arbitrator.

Indescon and Ogden had contracted under a JCT With Contractor’s Design (1981) for Indescon to build an office block for Ogden.

Disputes arose under the contract and Indescon referred them to arbitration by a notice in 1992. However, in 1999, Indescon had still not appointed an arbitrator. In 2000, Indescon served a second notice, which was stated to be without prejudice to the first notice. The second notice set out different disputes to those set out in the first notice, but did refer to the first notice. In 2002, an arbitrator was appointed. Ogden disputed the validity of the arbitrator’s appointment and also his jurisdiction.

The issue therefore was whether or not the first notice was valid.

The court granted the application. The passing of time did not render the first notice in 1992 invalid. There was nothing in the contract to say that the parties should proceed without delay in appointing an arbitrator, and there was no basis for implying such a term. Therefore, Indescon had not abandoned its first notice, and was entitled to proceed, having agreed an arbitrator with Ogden or applying unilaterally for the appointment of an arbitrator.

Herbert Smith Construction Update
January 2005

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