McCarrick v The Gaiety (Sligo) Ltd

• Jurisdiction: Ireland
• Judge: Mr Justice Herbert
• Judgment Date: 02 April 2001
• Neutral Citation: [2001] IEHC 56
• Court: High Court
• Docket Number: Record No 552 Sp/2000,[2000 No. 552 Sp]
• Date: 02 April 2001

McCARRICK v. THE GAIETY (SLIGO) LTD

IN THE MATTER OF THE ARBITRATION ACTS 1954– 1989

IN THE MATTER OF AN ARBITRATION

BETWEEN

CATHERINE McCARRICK

APPLICANT

AND

THE GAIETY (SLIGO) LIMITED

RESPONDENT

[2001] IEHC 56

Record No 552 Sp/2000

THE HIGH COURT

Synopsis:

ARBITRATION

Procedure

Landlord and Tenant - Lease - Rent review - Delay - Costs - Failure to furnish submissions within time frame - Role of the arbitrator - Arbitration Act, 1954 section 36(1) - Arbitration Act, 1989 (2000/552Sp - Herbert J - 2/4/01) [2001] 2 IR 266; [2002] 1 ILRM 55

McCarrick v The Gaiety (Sligo) Ltd

The applicant sought to have a matter reconsidered by an arbitrator. The arbitrator had made his award after the time for the receipt of submissions had expired. The applicant had failed to forward submissions within the agreed time frame. Herbert J held that in the light of the injustice that could result the matter should be remitted to the arbitrator.

Citations:

ARBITRATION ACT 1954 S36(1)

KEENAN V SHIELD INSURANCE COMPANY LTD 1988 IR 89

KING V THOMAS MCKENNA LTD 1991 1 AER 653

KEIGHLEY MAXSTED & CO V BRYAN DURANT & CO, RE 1893 1 QB 405

MONTGOMERY JONES & CO V LIEBENTHAL & CO, RE 1898 78 LT 406

ARBITRATION ACT 1954 S2(1)

COBELFRET V CYCLADES SHIPPING COMPANY LTD 1994 1 LLR 2837

TOBIN & TWOMEY SERVICES LTD V KERRY FOODS LTD 1996 2 ILRM 1

FOX V PG WELFAIR LTD 1981 2 LLR 514

LEX SERVICES PLC V ORIEL HOUSE 1991 2 EGLR 126

SOKRATIS ROKOPOULOS V ESPERIA (THE AROS) 1987 1 LLR 456

THE ARISTIDES XILOAS 1975 2 LLR 402

PORTSMOUTH ARMS HOTEL LTD V ENNISCORTHY UDC UNREP O'HANLON 14.10.1994 1995/4/1501

1 Mr Justice Herbert delivered the 2nd day of April. 2001

2 The applicant lessee in this case by a Special Summons issued on the 11th October, 2000, seeks an order of the court pursuant to Section 36(1) of the Arbitration Act, 1954. This Section provides as follows:-

"In all cases of reference to Arbitration, the Court, may from to time remit the matters referred or any of them to the reconsideration of the Arbitrator or Umpire."

3 As was pointed out by McCarthy, J., in Keenan -v- Shield Insurance Company Limited, (1988) I.R., 89 at 93, this Legislation, "took as its model the English Acts of 1889 and 1956." The only difference in the text of Section 22(1) of the English Arbitration Act, 1950 and the above Section is that in place of the word, "the Court,", in the above Section, the antecedent English equivalent uses the words, "the High Court or a judge thereof."

4 This claim arises out of an Arbitration to determine, upon rent review, the Current Market Rent of a premises at Wine Street, Sligo, held by the Applicant/Lessee under an Indenture of Lease made the 12th day of July, 1991 for a term of 35 years from the 20th July, 1989, with rent reviews every fifth year. By a Notice dated the 24th June, 1999 the Respondent/Lessor claimed a reviewed rent of £10,000 per annum for the period of five years commencing on the 20th July, 1999. This was not acceptable to the applicant lessee.

5 The parties failed to agree upon an Arbitrator and under the terms of the Lease the President of the Law Society of Ireland nominated Patrick O'Connor to act as Arbitrator and Mr O'Connor consented to act. The applicant/Lessee was represented by Mr Joseph Carter, Solicitor and the Respondent/Lessor by Mr Michael J. Horan, Solicitor, both of whom attended a preliminary meeting with the Arbitrator on the 1st June, 2000 where, inter alia, it was agreed that:-

"The Arbitration shall proceed by way of written submissions to be made to the Arbitrator. A formal hearing shall not be required and the Arbitrator may proceed on the basis of:"

(i) The submissions received from each of the parties and the surveyor's/valuer's reports referred to therein."

6 Consequently the presentation or non-presentation of these submissions and reports was a matter of primary importance to both parties. By letter dated 2nd June, 2000 the Arbitrator gave the following directions amongst others:-

7 1. "The parties are to prepare a schedule of agreed facts to be forwarded to me not later than 5.00 pm on Friday 23/6/2000 ..."

8 2. "The parties shall agree particulars of any comparable transactions, if possible, ... signed on behalf of both parties and submitted to me not later than 5.00 pm on Friday 23/6/2000. Any comparable transactions not agreed shall be included in the respective parties' representations."

9 4. "Copies of the claimant's written representations and the respondent's written representations are to be exchanged between the parties not later than 5.00 pm on Friday 23/6/2000 with copies to me. All paragraphs shall be numbered; this requirement is intended to assist both me and the parties in connection with the parties' counter-representations."

10 6. "Copies of the counter-representations on behalf of each party are to be exchanged between the parties not later than 5.00 pm on the 23/6/2000 with copies to me."

11 13. "Either party is granted leave to apply."

12 It was conceded at the hearing of this application that the submissions of the Respondent lessor, dated 20th June, 2000, were furnished to the Applicant/Lessee's Solicitors and to the Arbitrator on the 22nd June, 2000. It was further conceded by the parties that the submissions on behalf of the Applicant/Lessee were not exchanged or submitted within the time stipulated by the Arbitrator.

13 By a letter dated the 25th July, 2000 the Arbitrator wrote as follows to the Solicitors for the Applicant/Lessee:-

"Re: In the Matter of 1. The Arbitration Acts, and, 2. An Arbitration Between The Gaiety (Sligo) Limited - Lessor/Applicant and Catherine McCarrick - Lessee/Respondent"

14 Dear Mr Carter - Further to my letters of 2nd June last wherein I sent you my directions in relation to the above arbitration and to my letter of the 14th July, advising you of my intention to inspect the premises. I now:-

15 1. Advise that I have inspected the premises;

16 2. Attach submissions made by Murphy & Sons, Auctioneers Limited, on behalf of the Applicant/Lessor;

17 3. Confirm that in the absence of any submissions from you on behalf of the Respondent, none having been received thus far, that I propose to make an award/determination in the matter during the week commencing Monday, 31st July.

18 I would hope to have the award/determination available either on Thursday or Friday, 3rd/4th August.

19 Yours faithfully

20 Patrick O'Connor

21 Arbitrator"

22 This letter illicited no response whatsoever and no application was made for an extension of time for the delivery of submissions on behalf of the Applicant/Lessee.

23 By a letter dated 2nd August, 2000 the Arbitrator notified the Solicitors for both parties that he had prepared his final Award and would submit the same upon payment of his fees, costs and outlay as particularised. On the 4th August, 2000 the Arbitrator received from the Solicitors for the Applicant/Lessee submissions dated the 27th July, 2000 in the form of a Report from an Auctioneer and Valuer. By letter dated the 4th August, 2000 the Arbitrator responded as follows:-

"Re: In the Matter of"

1. The Arbitration Acts; and

2. An Arbitration

24 Between

25 The Gaiety (Sligo) Limited - Lessor/Applicant and Catherine McCarrick - Lessee/Respondent

26 Dear Mr Carter,

27 I received your letter of 3rd instant, with enclosures attached, today, Friday, 4th August, subsequent to the making of my final award in this matter which was done on 1st August. You recall that at the preliminary meeting held on Thursday, 1st June last it was agreed by the parties' representatives present that all submissions were to be made to me and representations exchanged between the parties, not later than 5.00 pm on Friday, 23rd June. This was referred to in the directions I issued on the 2nd June last.

28 By letter of the 25th July I advised you that I intended, having inspected the property, to make my determination in the week commencing Monday, 31st July which I have done. In this regard I refer you to my letter of 2nd instant. Yours sincerely"

29 On the 22nd August, 2000 the Solicitors for the Respondent/Lessor discharged the Arbitrator's Bill of Costs and under cover of a letter dated 24th August were furnished with two copies of the final Award dated 1st August, 2000.

30 No explanation whatsoever of what occurred or rather what did not occur in this case is offered in the Affidavit grounding this application. However, the Court was informed by Counsel for the Applicant/Lessee that the reason why Submissions were not furnished within the time stipulated by the Arbitrator, that is not later than 5.00 pm on Friday 23/6/2000, or even prior to Monday 31st July, 2000, the start of the week in which the Arbitrator, by his letter of 25th July, 2000 indicated that he would make his determination, was an error in the nature of an oversight on the part of those acting on behalf of the Applicant/Lessee. This was not challenged or disputed by Counsel for the Respondent/Lessor.

31 In these circumstances I believe that the Court is entitled to conclude that the failure to furnish submissions on behalf of the Applicant/Lessee within the time stipulated by the Arbitrator, or in any event prior to the making of the final Award, and the failure to apply to the Arbitrator for an extension of time within which to furnish such Submissions, did not arise from a deliberate and conscious decision on the part of the Applicant/Lessee or her advisers not to furnish written Submissions a decision from which it is now sought to resile with a view to having the matter reconsidered and redetermined in the light of the Submissions now sought to be made. The failure to furnish Submissions was entirely due to inaction on the part of the advisers of the Applicant/Lessee.

32 Counsel for the...