The law allows parties to a contract to include in its terms an agreement to refer disputes which may arise to arbitration, and the normal rule is that the courts respect such a reference by staying legal proceedings instituted without honouring such arbitration clause. It appears to me from the wording of section 5 of the Arbitration Ordinance,6(6) that the court should be more disposed to grant stay in matters of this sort unless there is sufficient reason to the contrary. Although the grant of stay of legal proceedings is subject to the discretion of the court, the onus of satisfying the court that there are sufficient grounds not to stay the proceedings remains on the party opposing the stay. The judge’s discretion is not exercised simpliciter but in conformity with well-established principles.
Heyman v. Darwins is an authority for the proposition that both questions of law and questions of fact can be determined by an arbitrator and a court cannot therefore refuse a stay because the court is in a better position to adjudicate upon such matter.
The question is not whether it will be more satisfactory that the case should proceed in court, but whether there is sufficient reason why the matter should not be referred in accordance with the submission because, in a sense, the person opposing the stay is seeking to get out of his contract to refer the dispute to arbitration. To refuse stay on this ground would in effect neutralise the contract the parties had agreed upon.
Unspecified difficulties as a ground for refusing a stay
With respect to the other points made on behalf of the respondents the answer is that as the dispute falls within the ambit of the arbitration clause and as an arbitrator has full and wide powers in deciding the matters before him, he can well deal with all the questions of law as well as of fact. It is wrong in principle for the judge to think that difficulties, which have not been specified, may arise and it would be better to have the matter in court.
