BDMS Ltd v Rafael Advanced Defence Systems

BDMS Ltd v Rafael Advanced Defence Systems

The defendant's refusal to pay its share of the advance on arbitration costs was not a repudiatory breach of the arbitration agreement, nor did it render the agreement inoperative. The claimant had means under the ICC Rules to proceed with the arbitration, and the breach did not deprive the claimant of substantially the whole benefit of the contract. Accordingly, the arbitration agreement remained operative and a stay of proceedings was granted under s.9 of the Arbitration Act 1996.

Parties
Claimant: BDMS Limited; Defendant: Rafael Advanced Defence Systems
Jurisdiction
England and Wales
Judgment Date
26 February 2014
Procedural Posture
Commercial Court Application / Application to Stay Proceedings Under S.9 Arbitration Act 1996
Outcome
Stay of proceedings granted
Legal Topics
Arbitration Agreement, Stay of Proceedings, Repudiatory Breach, Jurisdiction, Advance on Costs
Arbitration Commercial Law Arbitration Agreement Stay of Proceedings Repudiatory Breach Jurisdiction Advance on Costs

Case Brief

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Parties

BDMS Limited

Claimant

Rafael Advanced Defence Systems

Defendant

Procedural Posture

Commercial Court Application / Application to Stay Proceedings Under S.9 Arbitration Act 1996

Legal Issues

  1. 1 Whether the defendant's refusal to pay its share of the advance on arbitration costs was a repudiatory breach of the arbitration agreement
  2. 2 Whether the arbitration agreement was thereby rendered inoperative under s.9(4) Arbitration Act 1996
  3. 3 Whether a stay of proceedings should be granted

Ratio Decidendi

The defendant's refusal to pay its share of the advance on arbitration costs was not a repudiatory breach of the arbitration agreement, nor did it render the agreement inoperative. The claimant had means under the ICC Rules to proceed with the arbitration, and the breach did not deprive the claimant of substantially the whole benefit of the contract. Accordingly, the arbitration agreement remained operative and a stay of proceedings was granted under s.9 of the Arbitration Act 1996.

Court Disposition

Stay of proceedings granted

Orders

  • Proceedings stayed under s.9 Arbitration Act 1996