CL-2023-000064 - [2025] EWHC 1870 (Comm)

Fecha: 22-Jul-2025

The U/Ws’ submissions

234.

In their skeleton, the U/Ws said that there is nothing objectionable in principle about parties agreeing dispute resolution provisions that divide the process between liability being determined by a court and quantum being determined by an arbitral tribunal. Section 6(1) of the Arbitration Act 1996 defines an arbitration agreement as one where “the parties agree that a dispute...is to be resolved by arbitration”. It is suggested that this allows for a partial reference.

235.

The U/Ws say that the reasons for such clauses in insurance contracts is obvious: namely that resolving “pure” quantum disputes can be a technical and tedious process, which can usually be conducted more efficiently and cost-effectively by an arbitrator with a market, claims adjustment, or accountancy background.

236.

The U/Ws confirm that they are not seeking to refer any matters to arbitration until “liability [is] otherwise admitted”. The question is whether they should be referred to arbitration once all issues of liability, construction and/or law are resolved. By that stage, so the argument goes, liability will have been“admitted”because the U/Ws would have accepted the judgment of the Court on any liability issues.

237.

The U/Ws linked this to the way in which the Cs had advanced their claims, such that (the U/Ws argued):

237.1.

the Cs have not referred any “pure” quantum issues to the Court;

237.2.

some five years on from the events in question, they have not particularised the quantum of their claim, beyond providing some estimates: e.g. “in excess of £80 million”(see paragraph 37 of the Amended Particulars of Claim);

237.3.

there is no proper claim for damages or an indemnity in the Amended Particulars of Claim;

237.4.

the Cs have, instead, sought to have various preliminary issues determined, anticipating that, after that, there would be a consensual “loss adjustment process”(see the recitals to the order of 4 July 2024).

238.

The U/Ws contend that section 9 of the Arbitration Act 1996 is a red herring:

238.1.

as no “pure” quantum dispute has yet been referred to the Court by the Cs, any application for a stay would be premature.

238.2.

section 9(1) says a party“may”apply for a stay but there is nothing to stop the parties instead agreeing a preliminary issue to resolve, in advance, whether or not 'pure' quantum disputes must be arbitrated after all other issues have been resolved;

238.3.

to the extent that a stay might be required in the future, the U/Ws have taken no “step” to answer the relevant “substantive claim” (meaning the claim covered by the arbitration agreement – “pure” quantum issues).

239.

Orally, Mr Walsh KC, who had conduct of this issue on behalf of the U/Ws, took a more limited point, as I will explain.