TIANQI LITHIUM KWINANA PTY LTD -v- MSP ENGINEERING PTY LTD [No 2] [2020] WASCA 201 (3 December 2020) - WASCA 2020 case summary — Zoe

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TIANQI LITHIUM KWINANA PTY LTD -v- MSP ENGINEERING PTY LTD [No 2] [2020] WASCA 201 (3 December 2020)

[2020] WASCA 201

Court of Appeal (WA)|2020-12-03|Before: Buss P

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Source facts

Court

Court of Appeal (WA)

Decision date

2020-12-03

Before

Buss P

Source

Original judgment source is linked above.

Judgment (219 paragraphs)

[1]

This is an appeal against a decision of Master Sanderson in MSP Engineering Pty Ltd v Tianqi Lithium Kwinana Pty Ltd[1] (primary decision).
The master dismissed an application by the appellant (Tianqi) to stay proceedings commenced by the respondent (MSP) in relation to moneys allegedly owing by Tianqi to MSP pursuant to two (relatively identical) contracts, under which Tianqi engaged MSP to design and construct a lithium hydroxide processing plant in Kwinana. The two contracts are referred to as 'LHPP1' and 'LHPP2'. MSP claims that, under LHPP1, a payment of $26,969,407.88 has been certified by the Superintendent as due by Tianqi to MSP, and that, under LHPP2, a payment of $5,643,951.49 has been certified by the Superintendent as due by Tianqi to MSP. In each case the certification was made under cl 37 of the relevant contract.
There was no dispute before the master that (1) the contracts were on foot, and (2) the relevant payments had been duly certified by the Superintendent.[2]
Tianqi contends that the claims the subject of the primary proceedings are required to be dealt with by arbitration in accordance with s 8 of the Commercial Arbitration Act 2012 (WA) (Arbitration Act). Tianqi applied to stay the primary proceedings on that basis. Master Sanderson dismissed the stay application and made programming orders for a summary judgment application by MSP in relation to the claims.
Tianqi seeks leave to appeal against the orders dismissing its application to stay the primary proceedings. MSP resists the grant of leave and has filed a notice of contention in the appeal. By its notice of contention, MSP alleges in effect that the master's decision should be upheld because (1) on the proper construction of the contracts, the proceedings brought by MSP are to enforce payment due under the contracts in accordance with cl 42.4, and (2) even if Tianqi advanced an argument before the master that the contracts are void by reason of pre‑contractual misleading and deceptive conduct, the relevant clause relating to the enforcement of payments due under the contracts could not be void.

[47]

On 4 March 2020, MSP commenced the primary proceedings, claiming payment of the outstanding certified amounts. Service of those proceedings on Tianqi was effected on 5 March 2020.
Notices of dispute were first issued by Tianqi on 6 March 2020.[4]
The notice of dispute in relation to the LHPP1 contract outlined amounts claimed by Tianqi against MSP, but did not expressly contend that Tianqi's claims gave rise to any equitable set-off against MSP's claims for payment under the payment certificates.[5] The notice of dispute in relation to the LHPP2 contract expressly included a claim for equitable set-off.[6] Both notices of dispute also alleged claims by Tianqi for misleading and deceptive conduct.
Tianqi's notice in relation to the LHPP1 contract included certain allegations with respect to misleading and deceptive conduct. They are summarised later, in [139] below.
Tianqi's notice in respect of the LHPP2 contract also included claims for misleading and deceptive conduct. They are outlined in [140] below.
Neither notice of dispute contended that Tianqi was entitled to set aside the contracts for misleading or deceptive conduct.
There was evidence before the master to the effect that prior to the issue of the notices of dispute by Tianqi on 6 March 2020:
1. The parties had executed a 'Deed of Variation (No 3)' in May 2019 and a 'Deed of Variation (No 4)' on 8 October 2019, and that in each case, the deed stated, in effect, that save for the express terms of the variation, the parties agreed that 'the Contract is expressly ratified and confirmed'.[7]
2. The payment certificates sought to be enforced by MSP in the primary proceedings included certification by the Superintendent for WUC by MSP in excess of the specified 'Target Cost Estimate'.[8]
3. Tianqi had agreed to a payment plan to pay the moneys certified as due, pursuant to which Tianqi made a number of payments but thereafter ceased making payments, as it was unable to meet the agreed payment plan.[9]
4. Tianqi acknowledged that it was not in a position to pay its creditors.[10]
At the time of the primary proceedings, MSP accepted that the dispute resolution procedure under cl 42 of the contract had been activated by the notices of dispute. An arbitrator had been appointed to deal with the issues raised in the notices of dispute.[11]

[53]

The master said that the purpose of a provision such as cl 42.4 in the building context was to keep money flowing in a construction contract. He noted that this principle was also clearly expressed in the Constructions Contracts Act 2004 (WA), which, while not relevant in this case, acted as legislative acknowledgement of the importance of keeping money flowing in construction contracts.[25]
The master said that, properly viewed, cl 42.4 is a recognition of such a principle and that such an interpretation of the contract does not affect the integrity of the arbitration process. A reasonable business person would appreciate that if an amount which was required to be paid - which the parties had agreed would be paid - was not paid, then a resort to the courts for prompt enforcement was both reasonable and necessary. Such an interpretation did not affect the integrity of the arbitration process. Further, cl 37 anticipates that the process can follow through to completion and it may well be that the award will favour the principal, so that the contractor will be forced to disgorge some of the money they have received as progress payments.[26] The master concluded that, in the circumstances, he was not satisfied that a stay ought to be granted based upon the proper interpretation of cl 37 and cl 42 and the Arbitration Act.[27]
The master then turned to consider the question of whether, in the exercise of discretion, a stay ought to be granted. He considered that in exercising his discretion, account should be taken of the same considerations to which he had referred, namely maintenance of the integrity of the construction contract process entitling a contractor to claim payment of certified amounts. It followed that he was not satisfied it would be a proper exercise of discretion to refer a claim such as the present to arbitration. He noted that it may be that an arbitrator could make an interim award which would effectively enforce the certified amounts, but that question was not the subject of detailed submissions and counsel for MSP had suggested there was doubt about that issue. He concluded:[28]

[81]

For the purposes of s 8(1) of the Arbitration Act, a party 'so requests' a referral to arbitration by the making of a stay application.[52]
Section 8(1) invites attention to whether the proceedings before the court are brought in 'a matter which is the subject of an arbitration agreement'. In determining this question, it is necessary to first identify the subject matter of the controversy which falls for determination in the proceedings before the court.[53] The 'matter' to be determined in a proceeding is to be ascertained by reference to the subject matter of the dispute in the curial proceeding and the substantive, although not necessarily the ultimate, questions for determination in the proceeding. The scope of the matter is to be ascertained from the pleadings and from the underlying subject matter upon which the pleadings, including the defence, are based.[54] As Tanning Research and Rinehart illustrate, the character of a matter in which an action is brought as a matter which is the subject of an arbitration agreement may arise from the nature of the defence to the claim in the curial proceedings as well as the nature of the claim in the curial proceedings.
A 'matter' for the purposes of s 8(1) may or may not comprise the whole dispute in any given court proceeding.[55]
As noted earlier, in this case, there was a further issue as to the proper construction of s 8 of the Arbitration Act. Tianqi submitted that s 8 of the Arbitration Act required the court to refer the parties to arbitration so long as the contracts allowed for the determination of the dispute in that manner, even if reference to arbitration was not required. We do not accept that submission. Section 8 refers to 'a matter which is the subject of an arbitration agreement'. This may be contrasted with the language of s 7(2) of the International Arbitration Act 1974 (Cth), which refers to a matter that 'is capable of settlement by arbitration'.
In Hancock Prospecting Quinlan CJ (with whom Beech and Vaughan JJA agreed on this point) observed, consistently with the paramount object identified in s 1C(2)(a) of the Arbitration Act:[56]

[88]

We think that any rigid taxonomy of approach is unhelpful, as are the labels 'prima facie' and 'merits' approach. How a judge deals with an application under s 8 of the CA Act will depend significantly upon the issues and the context. Broadly speaking, however, and with some qualification, aspects of the prima facie approach have much to commend them as an approach that gives support to the jurisdiction of the arbitrator and his or her competence, as recognised by the common law and by s 16 of the CA Act, whilst preserving the role of the Court as the ultimate arbiter on questions of jurisdiction conferred by ss 16(9) and (10), 34(2)(a)(iii) and 36(1)(a)(iii) of the CA Act. Broadly, the approach is consonant with the structure of the CA Act and the Model Law. However, it is difficult to see how the Court can exercise its power under s 8 without forming a view as to the meaning of the arbitration agreement. Further, it may be that if there is a question of law otherwise affecting the answer to the question of jurisdiction, especially one that is confined, which might be dispositive, it might be less than useful for the Court not to deal with it.

...

To understand whether a body of disputes being the 'matter', assessed and characterised (at the necessarily early stage of the proceeding), is the subject of an arbitration agreement, will generally require the Court to form a view as to the legal meaning of the arbitration agreement. Section 8 is an important power the purpose of which is to protect the practical legitimacy and authority of the arbitration process as reflected in the words of s 1C of the CA Act. It involves the referral to arbitration, by a stay of court proceedings. However, it will often not be possible fully to delineate the metes and bounds of a dispute without fully hearing the dispute. To do so, that is to hear the facts to decide the width of the dispute, would undermine the practical and effective operation of s 8. The application must be brought early (not later than when submitting the party's first statement on the substance of the dispute). The boundaries of the dispute may be unclear, but it will have to be characterised on the material available to be assessed as to whether it can be seen to be the 'subject of' the arbitration agreement. That latter assessment will require some stability or clarity as to the meaning of the arbitration agreement. The Court is then required to construe the clause, at least to the point of being satisfied that the disputes forming the matter are the subject of the agreement, or not, as the case may be. That said, and it is relevant to the arguments here, not every legal question need be, or should be, decided by the Court about the rights and obligations of the parties. That too would tend to undermine the practice and effective operation of s 8.

[95]

The Full Federal Court went on to conclude that Gleeson J had erred by, in effect, concluding a dispute under the deed on the basis that the assertion (that the deed operated as a release) was not sustainable when it was 'plainly sustainable' that the dispute was within the terms of the arbitration agreement. Gleeson J was held to have erred by undertaking a 'form of summary disposal'.[68]
Generally speaking, therefore, it is not appropriate for a court considering an application for a stay under s 8 to consider the merits or arguability of the parties' contentions in the dispute said to constitute a matter which is the subject of an arbitration agreement.
In identifying that general position, the position is not without possible exception. If, for example, a defendant to proceedings for breach of contract, properly commenced by the plaintiff in court, sought a stay on the basis that matters concerning the validity of the contract were the subject of an arbitration agreement, and in that context made the mere assertion that the contract ought be avoided ab initio without indicating on what conceivable basis or why, a court might not conclude that there was a 'matter' concerning the validity of the contract requiring referral to arbitration under s 8(1). Similarly, if the contention were that the contract should be set aside for some implausible reason (eg, that the contract was executed on a Tuesday), a court might conclude that there was no 'matter' which under s 8(1) of the Arbitration Act required referral to arbitration. It is unnecessary to determine these extreme examples, which do not arise in the present case.
However, in our view an exception to the above general position can arise where the arbitration agreement defines the matter which is required to be referred to arbitration by reference to the arguability or other merits of the parties' contentions in the dispute. As was noted in Hancock FFC,[69] the width or narrowness of the scope of the arbitration agreement is central to the ascertainment of the matter subject to it. In our view, such an exception arises under the arbitration agreements in the present case. We turn to the proper construction of the contracts in this case.

[103]

Clause 42.4 properly construed in the context of the whole contract is inconsistent with Tianqi's submission that the clause only applies to payments which are not in dispute in any sense.
A number of observations may be made about the construction and operation of cl 42.4. First, the opening words 'Nothing herein' refer to nothing in cl 42.1 ‑ cl 42.3.[74] The effect of the opening words is that despite the requirement that disputes be referred to arbitration, the requirement is not to be read as 'prejudicing' a party's 'right' to institute curial proceedings in three respects (1) proceedings 'to enforce payment due under the Contract', (2) injunctive relief, and (3) urgent declaratory relief.
Secondly, the reference to a party's 'right' to institute proceedings is consistent with the party's reservation of rights under cl 46.6.
Thirdly, the right to 'institute' proceedings must mean more than the right to file the writ. It must also mean the right to have the proceedings so instituted determined by a court, consistently with the scope and object of cl 42.4, without the need to go to arbitration. The right to initiate proceedings in respect of the second and third matters in cl 42.4 (injunction and urgent declaration), notwithstanding cl 42.1 ‑ 42.3, presupposes the existence of a dispute or disputes in that connection which would otherwise be required to go to arbitration. By cl 42.4, the parties contemplate that those disputes will be resolved in court, and not by arbitration. At least the third of those matters (declaratory relief) involves final relief, typically a declaration expressed by reference to 'the proper construction of the contract and in the events which have happened'. Tianqi accepted in this appeal that an arbitrator would be bound to accept a declaration made by the court, and that the disputes thereby resolved by curial determination could not be re‑agitated by a party in the arbitration.[75] These considerations inform the scope and nature of cl 42.4 and tend against a construction, as advanced by Tianqi, that the first of the three subject matters with which it deals stands apart as merely an adjunct to, rather than a substitution for, arbitration.
Fourthly, while s 9 of the Arbitration Act provides that it is 'not incompatible' with an arbitration agreement for a party to request from a court 'an interim measure of protection' (as defined),[76] the real significance of cl 42 is that it is a contractual expression of the parties' intentions concerning the balance between arbitration and litigation which transcends the operation of s 9. Further, the agreement for the resolution of disputes by curial injunction or urgent declaration indicates that cl 42.4 has a not insignificant breadth of potential operation.
Fifthly, cl 42.4 is drawn in the context that the subclauses which immediately precede it indicate that the procedure for getting to arbitration takes time. It involves (1) a notice of dispute being given (to each of the other party and the Superintendent) by registered post or hand, (2) conferring about the dispute up to 14 days later, (3) the referral of the dispute to arbitration if the dispute is not resolved within 28 days of service of the notice of dispute, (4) a further 14 days to allow the parties to reach agreement on the appointment of an arbitrator, and (5) in the absence of agreement, appointment by the president of the Institute of Arbitrators and Mediators of Australia - a mechanism which would also presumably take some time before an appointment to arbitrate were accepted by an arbitrator.[77]
Sixthly, cl 42.4 operates in a context in which, at least where the contract is on foot, there is longstanding authority to the effect that a claim for the payment of certified progress payments under a provision such as cl 37 is amenable to summary judgment without recourse by the other party to equitable set-off (see [91] above).
Seventhly, the first and third of the matters referred to in cl 42.4 - proceedings to enforce payment of a sum due under the contract and declaratory relief - are in the nature of final orders. Prima facie (although it is not necessary to determine conclusively the matter in this appeal), the reference to injunctive relief also includes final injunctive relief. In any event, it is the character of either form of injunctive relief that damages are not an adequate remedy.[78] In other words, it is a remedy which does not require the forum to undertake an assessment (often time‑consuming and complex, particularly in construction disputes) of the consequences of the relevant breach in terms of damages. These considerations tend to indicate that cl 42.4 is not designed to refer the resolution of complex money claims and damages to the court.
Eighthly, it may be inferred from the nature of the three matters to which cl 42.4 refers (enforcement of payment due under the contract, injunction and urgent declaration) that the parties understood that each was not only appropriately amenable to curial determination, but that curial determination would likely provide an early and efficient vindication of the parties' accrued rights.
Ninthly, the words 'Nothing herein shall prejudice the right of a party' could have no sensible meaning in their application to the first of the three matters referred to in cl 42.4 if the words 'to institute proceedings to enforce payment due under the Contract' merely mean 'proceedings to enforce an arbitral award for payment due under the contract'. That is because nothing in cl 42.1 ‑ cl 42.3 could be read as prejudicing the right of a party to enforce an arbitral award.
Tenthly, the word 'due' in this context evidently means 'due and payable'. There could be no institution of proceedings to 'enforce' a payment which was due, but not payable.[79] That is so even though the contract in other clauses expressly uses the words 'due and payable'.[80]
Eleventhly, the words 'to enforce payment due under the Contract' in their ordinary meaning indicate that there are payments 'due' under the contract itself, and invite attention to the contractual provisions providing for payments of that character. The words are not easily glossed to read 'to enforce payment due under an arbitral award'.
Finally, a reasonable business person[81] would understand that cl 37.2 is an obvious candidate for a contractual provision which provides for 'payment due under the Contract'. That is because:
1. Clause 37.2 provides a comprehensive contractual mechanism for payment by reference to (1) detailed information having been provided to the Superintendent, and (2) a determination having been made by the Superintendent - the person appointed to act honestly and fairly and arrive at a reasonable measure or value of work, quantities or time. Clause 37.2 operates in that sense to provide for a payment 'due under the Contract'.
2. The payment for which it provides is not only due and payable, but it is due and payable without set-off or deduction.[82]
3. Clause 37(2) whilst in its practical application is likely often to result in payments to the contractor, the provision nevertheless cuts both ways. A certified payment under cl 37.2 may result in money due and payable to the principal.
4. A payment that is due and payable to either party without set-off or deduction by the other is readily amenable to curial enforcement without having to interpose an arbitral award for payment, which in turn would then require curial intervention before enforcement.
The above considerations combine to indicate that the first matter referred to in cl 42.4 denotes (and it is not necessary to determine whether this is its exclusive denotation) the institution of proceedings for the enforcement of a progress payment certified as due in accordance with cl 37.2 which is capable of summary determination.
The wide definition of the term 'dispute' in the contract, and the 'liberal approach' to the construction of arbitration clauses to which Tianqi referred may be accepted, but they do not assist Tianqi on this point. Clause 42.4 operates to preserve rights to curial relief notwithstanding the width of the disputes otherwise referable to arbitration. The parties have not 'submitted to arbitration' within the meaning of s 7(1) of the Arbitration Act the three matters in cl 42.4 to which they have reserved their rights of recourse to the court.

[104]

The construction postulated at [88](c) above - that the reference to 'proceedings to enforce payment due' under the contract is to proceedings which are capable of summary determination - also best fits the commercial purpose evident from the terms of the contracts.
Clause 42, on its proper construction, enables a party not only to 'institute' proceedings in respect of the three matters referred to in cl 42.4, but to have the proceedings determined consistently with the scope and object of cl 42. Having regard to the constructional matters referred to in [94] ‑ [105] above, the scope and object of a party's entitlement to institute proceedings to enforce a payment due under cl 37.2 is to enable the party to expeditiously obtain judgment on the sum due, at least typically by summary judgment. The constructional choice which best fits the object and scope of cl 42.4 in this context is the third construction postulated at [88](c) above.
The second possible construction postulated at [88](b) above, insofar as it envisages the court determining on its merits a defence raising a triable issue, is inconsistent with the scope and purpose of cl 42.4, at least in its first aspect ('the right of a party to institute proceedings to enforce payment due under the Contract'). If, for example, the court in which the proceedings were instituted found a triable issue as to whether the contracts ought be avoided ab initio, the character of the matter before the court at that point would, in substance, be whether there was a contract under which any money was due at all (there being no dispute, on this hypothesis, that if the contracts were not void ab initio, there would be no dispute as to payment). If the resolution of the proceedings required the determination of such an issue, the proceedings would not be proceedings for the enforcement of a 'payment due under the Contract'. The parties could not objectively have intended that cl 42.4 applied to the determination of such an issue, having regard to the scope and effect of cl 42 read as a whole in the context of the contract as a whole.
The first possible construction postulated at [88](a) above would undermine the utility of the contractual entitlement to institute proceedings under cl 42.4. If the court concluded that the postulated defence raised no objectively triable issue, a referral to arbitration would mean that the party to whom the moneys were due under the contract would be kept out of its money for no good reason. That is a construction which makes no commercial sense. Nor is it a construction which is consistent with the commercial objects of the contract read[83]s a whole.83

[110]

Turning to Eriez's alternative submission premised on cl 42.5, it does seem to me that the breadth of the disputes referable to arbitration is relevant to the proper construction of this clause. As I mentioned earlier, the breadth of disputes the subject of the dispute resolution clause is very wide, as it concerns any dispute arising in connection with, amongst other things, a claim. As I noted earlier, the expression 'claim' is defined to include any claim for payment of money under the subcontract. Consequently, any claim for payment of money under the subcontract is a dispute.

In that context, it seems to me to be clear that when cl 42.5 preserves the right of a party to institute proceedings to enforce payment due under the subcontract, it cannot be referring to the payment of amounts which are disputed. Rather, the provision is directed to the enforcement by the court of payment of moneys due and owing and no longer disputed under the subcontract.

That approach is consistent with, and supported by the other provisions of cl 42.5 which exempt from the operation of cl 42 proceedings seeking injunctive or urgent declaratory relief. A common characteristic, of course, of injunctive or urgent declaratory relief is that it is relief of a kind not easily or readily given by an arbitrator. Similarly, arbitrators are incapable of making orders enforcing payment of awards made by an arbitrator. So, cl 42.5 is directed to preserving the rights of parties to invoke the jurisdiction of the courts in circumstances in which an arbitrator could either not provide the relief sought, in terms of enforcement, or would have difficulty providing the relief sought, as is the case with urgent or injunctive declaratory relief. The clause has no application where there is a dispute, because otherwise its operation would entirely undermine all the provisions of cl 42 which precede it. As Eriez's claims for payment are disputed, it seems to me that cl 42.5 does not apply, and it cannot be seriously contended that the relief sought by Eriez in these proceedings is either injunctive or declaratory relief which is urgent.

[111]

Martin CJ in Eriez Magnetics was not, apparently, addressing an issue concerning the institution of proceedings to enforce a payment due under a certified payment regime such as cl 37.2 of the contract in this case. His Honour's observations as to the scope of cl 42.5 in that case (analogous to cl 42.4 in this case) are to be read in that context. Accordingly, his Honour was not dealing with the question of construction raised in this appeal. If we were wrong in that, and his Honour's remarks are to be read more widely, we would respectfully consider that they are erroneous if and insofar as they are to be read as precluding the institution of proceedings to recover duly certified progress payments under a provision the same as cl 37.2 of the contract in this case.
Nor is the decision of GR Engineering of any relevant assistance. That case involved a construction contract between Eastern Goldfields as principal, and GR Engineering as contractor.[92] The contractor sued the principal, and the principal applied for a stay on the basis that the matters were required to be referred to arbitration. The contract included a payment regime for progress claims similar to cl 37 in this case,[93] and a dispute resolution clause similar to that of cl 42 in this case.[94] It was a case in which there was a dispute as to whether the progress payments claimed by the contractor had been duly certified under the contract, in that, the principal asserted, no superintendent had been appointed.[95] Other payments claimed by the contractor appeared to be payments allegedly arising under another contract and were not (it appears) contended by the contractor to be certified payments under the construction contract.[96] Tottle J in this context said that he was satisfied that there were 'disputes' between the parties which engaged a clause analogous to cl 42 in this case.[97] His Honour granted a stay and said that the cl 42 equivalent in that case must be construed on the basis that 'all disputes about whether payments are due under the Contract should be determined in arbitral proceedings. The construction ... for which [the contractor] contends would create uncertainty as to which disputes must be resolved by arbitration and which disputes could be the subject of proceedings'.[98] His Honour said that his view was fortified by reference to the decision of Martin CJ in Eriez Magnetics.[99]
In GR Engineering, his Honour appears to have found, relevantly, that if there were a dispute about whether the payments had been duly certified in the absence of the appointment of a superintendent, that dispute was required to be arbitrated, as was any dispute about other (non‑certified) claims. That is not this case. The correctness of the decision in GR Engineering in relation to the facts of that case need not be considered, although it may be noted that the parties did not, it appears, refer his Honour to the decision in Devaugh. Again, if and insofar as his Honour's reasons should be read as precluding the institution of proceedings to recover duly certified progress payments under a provision the same as cl 37.2 of the contract in this case, we would respectfully consider it to be erroneous.
MSP relies on the decision of Vickery J in Lysaght Building Solutions. In that case:
1. The contractor commenced curial proceedings and sought summary judgment against the principal in respect of certain progress claims allegedly certified by the superintendent.[100]
2. The principal counterclaimed, including in respect of an allegedly certified payment sum due to it, and sought summary judgment on that certified payment claim.[101] The principal also alleged waiver by, and an estoppel against, the contractor in relation to the principal's claimed entitlement to payment under the alleged payment certificate.[102]
3. The principal also had other claims involving damages for breach of contract.[103]
4. The contractor, as well as applying for summary judgment on the certified progress claims due to it, sought to stay the principal's claims on the basis that they were required to go to arbitration.[104]
In relation to the contractor's application for summary judgment in respect of the certified progress claims due to the contractor, the principal contended that there had been no valid certification within the meaning of the relevant clause because of non‑compliance with its evidentiary provisions.[105] The court held that the principal had a 'real chance of success' on that issue, and that this was a triable issue. The court accordingly dismissed the contractor's application for summary judgment on those claims.[106] Whilst dismissing the application for summary judgment, his Honour evidently considered that the litigation of this issue should be continued in the curial proceedings, and did not require resolution in arbitration.[107] In relation to the principal's claim for summary judgment on the certified payment in its favour, the judge found (again) that there was a triable issue as to whether the payment certificate was a valid payment certificate in accordance with the relevant contract, and dismissed summary judgment on that claim.[108] Again, his Honour nevertheless considered that this issue should continue to be tried in court and did not require resolution by arbitration.[109] His Honour also considered that the principal's claims of waiver and estoppel, which were associated with its claim for payment under the alleged payment certificate, were properly part of the litigation and did not require resolution by arbitration.[110]
In this regard, Vickery J said:[111]

[141]

For the above reasons, the appeal should be dismissed.
We note that, at the time of preparing these reasons, there was an undetermined summary judgment application pending in the primary proceedings. That application may raise issues which were not before the master when dealing with the application made under s 8 of the Arbitration Act. In the event that the court hearing that application were to determine that Tianqi had raised a triable issue and refused MSP's summary judgment application, it would then also have in effect determined that the action was brought in a matter which the arbitration agreement required be referred to arbitration. That is, it would have determined that MSP's claim in the primary proceedings was not capable of summary determination.
In that event, while Tianqi's application under s 8 of the Arbitration Act has been determined, it would be open (and at least ordinarily appropriate) for the primary court to refer the matter to arbitration in the exercise of its inherent jurisdiction.
We have found that Tianqi failed, on the material before the master, to establish that the action was brought in a matter the subject of an arbitration agreement, on the basis that it had not established MSP's claim to be incapable of summary determination. That is not equivalent to a finding that the action was not brought in a matter the subject of an arbitration agreement, or a finding that MSP's claim is capable of summary determination. Nothing in these reasons operates to preclude the refusal of summary judgment based on material or issues which were not before the master.
For example, these reasons do not preclude a finding in the primary court that MSP's summary judgment application should be dismissed based on:
1. the application of cl 39.10 of the contracts to the purported termination of the contracts after the dismissal of the s 8 application, or
2. a claim by Tianqi for rescission of the contracts for misleading and deceptive conduct to the extent that claim is advanced in the summary judgment application.
In noting these possibilities, we should not be taken to be indicating any view as to how the primary court should resolve those matters, to the extent that they may be raised by Tianqi in defence to MSP's summary judgment application.