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Case 368: MAL 7(1), 8(1)
Canada: Ontario Court, General Division (Hockin J.)
9 August 1993
Campbell et al. v. Murphy
Original in English
Published in English: (1993), 15 O.R. (3d) 444, 12 C.L.R. (2d) 10, O.J. no. 1905
Campbell and Murphy entered into a written agreement whereby Murphy agreed to build a house for Campbell in Antigua. The agreement included an arbitration clause. The house was not completed and Campbell sued Murphy for damages for breach of contract. After the statement of claim was issued, Murphy gave notice of his desire to arbitrate and moved for an order staying the action. Campbell objected to the stay on the grounds that the arbitration clause was optional. He also argued that the Court had first to determine whether the contract subsisted before referring the parties to arbitration.
A stay was granted. In accordance with article 7, the arbitration clause was found to be a valid and mandatory arbitration clause as it used the expression "shall...be referred to arbitration". The second argument was also rejected on the basis that the claimed repudiation of a contract did not retroactively nullify the contract or the arbitration agreement contained therein and therefore article 8 compelled a referral to arbitration.
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