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Cite as: [2024] CSOH 63, [2024] ScotCS CSOH_63

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OUTER HOUSE, COURT OF SESSION

[2024] CSOH 63

CA77/22

OPINION OF LORD BRAID

In the cause

BRIGGS MARINE CONTRACTORS LIMITED

Pursuer

against

BAKKAFROST SCOTLAND LIMITED

Defender

Pursuer: E Grieve (sol adv); Addleshaw Goddard

Defender: Manson; Morton Fraser MacRoberts LLP

21 June 2024

Introduction

[1]

Following a debate, this commercial action was sisted for a period of 3 months on

2 February 2023 (2023 SLT 193); that was because the matters in dispute were, and are,

governed by an arbitration clause in the contract between the parties. Since then, the

arbitration (which is seated in England, the parties' contract being governed by English law)

has begun and is proceeding in what appears to the outsider to be a somewhat leisurely

fashion towards a final resolution. Some written pleading has taken place; neither party

was able to tell me when there would be a substantive hearing, but it appears to be common

ground that resolution within the next year is unlikely (this in the context of a relatively

narrow dispute in which the summons was lodged in this court in September 2022).

[2]

The issue for resolution now is whether the action must remain sisted, standing

the terms of section 10 of the Arbitration (Scotland) Act 2010, below, or whether it should

now more appropriately be dismissed.

Section 10 of the Arbitration (Scotland) Act 2010

[3]

Section 10 of the 2010 Act provides, insofar as material:

"10 Suspension of legal proceedings

(1)

The court must, on an application by a party to legal proceedings

concerning any matter under dispute, sist those proceedings in so far

as they concern that matter if

(a)

an arbitration agreement provides that a dispute on the matter

is to be resolved by arbitration...

[certain other conditions which must be met]

(e)

nothing has caused the court to be satisfied that the arbitration

agreement concerned is void, inoperative or incapable of being

performed.

...

(3)

This section applies regardless of whether the arbitration concerned

is to be seated in Scotland."

Procedural history

[4]

Following the initial 3-month sist, the action has subsequently been sisted for periods

of respectively 6 and 4 months, the most recent sist expiring on 13 March 2024. When it

called before me on 15 March 2024, the defender moved at the bar to dismiss the action

on the ground that it was serving no discernible purpose. Since the pursuer had had no

advance notice of that motion, I continued it, and the action, for 3 months, to afford the

pursuer the opportunity of addressing the court on what benefit there was to the pursuer

in keeping the action alive, and of updating me on the progress of the arbitration generally.

Submissions

Defender

[5]

When the action called before me afresh, counsel for the defender renewed the

motion to dismiss the action. He submitted that the action had no utility. Its continued

existence was causing the defender prejudice since it had to keep checking in with the court

and was incurring continuing, and pointless, expense. While it could not be said that there

was no conceivable circumstance in which the action might serve some purpose or other, it

was for the pursuer to articulate what that purpose might be and it had been unable to do

so. The position would be otherwise had the arbitration been seated in Scotland, in which

event the parties might have had a need to have recourse to the court, but this was an

English arbitration governed by English law and should recourse to the courts be needed,

that would be to an English court. While section 10 of the 2010 Act required the court to

sist an action where parties had agreed to arbitration, the court had done that. There was

nothing in that provision which required the court to allow an action to remain sisted

indefinitely. The court retained an inherent power to dismiss an action where it was

pointless, and where its jurisdiction had been ousted: North British Railway Co v Newburgh

and North Fife Railway Co 1911 SC 710. Nothing in Fraserburgh Harbour Commissioners v

McLaughlin & Harvey Ltd [2021] CSIH 58 prevented the court from exercising that power,

where it was appropriate so to do. If not dismissing the action, the court should accede to

the pursuer's motion and appoint it to proceed as an ordinary action.

Pursuer

[6]

The solicitor advocate for the pursuer moved me to sist the action for a year (or

indefinitely). She recognised (astutely and accurately) that such a long sist would be

anathema to the commercial court, and so also moved me to remove the action from the

commercial roll. If the action became an ordinary one, there would be no need for parties

to "check in" with the court; nor, she assured me, would the parties lose sight of the action

once the arbitration was completed, as can so often happen. It would be prejudicial to the

pursuer were the action to be dismissed. When pressed by me as to what advantage there

was to the pursuer in the action remaining in court, she replied that further claims might

arise out of the arbitration which would not be covered by the arbitration clause, and which

could be brought in the present action, although she could not give any specification as

to what those claims might be. She submitted, again without reference to any concrete

examples or to authority, that the court action might prove useful in any document recovery

exercise which might be undertaken. She further submitted, again in very general terms,

that alternatively the action might be useful in an enforcement context. Although she

submitted that section 10 envisaged that an action which was sisted would remain so until

the conclusion of the arbitration, she accepted the general principle that the court retained

an overall discretion to dismiss an action if the arbitration were taking an inordinate length

of time, such as (say) 10 years, although she did not think that the present arbitration would

last that long.

Decision

[7]

The starting point is to note that sists in the commercial court should be the

exception rather than the rule. They are at odds with the oft-and-increasingly-overlooked

premise that the commercial court exists to provide parties with a speedy resolution,

utilising a bespoke procedure, to any dispute of a commercial nature. There will be

situations where a sist is inevitable - in the present case, by virtue of section 10 of the

2010 Act, it was mandatory - but they should be few and far between; and when a sist

is granted, the court, in exercise of its case management powers, will necessarily keep it

under review. It is not a productive use of the court's time or resource - both judicial and

non-judicial - to be constantly checking on the progress of an arbitration, particularly one

which is proceeding slowly.

[8]

The next question is whether section 10 of the 2010 Act requires the court, once it

has sisted an action, to allow the action to remain sisted indefinitely. Phrased in that way,

I do not consider that it does. If, to take as an example the period postulated by the solicitor

advocate for the pursuer, the arbitration were still limping along after 10 years, and neither

party was showing any enthusiasm in progressing it, I consider that at that point the court

would be entitled to dismiss the action, effectively for want of prosecution, or for

unconscionable delay. That said, the inevitable corollary of the section 10 requirement

to sist an action for an alternative dispute process to take place, is that the action should

remain sisted pending the outcome of that process: see Fraserburgh Harbour Commissioners v

McLaughlin & Harvey Ltd, above, at [19]. It would be illogical if part way through that

process, and while it was still active, the court then became entitled to recall the sist and to

dismiss the action. As Lord President Carloway pointed out at [16], whether the action was

of any utility or purpose was not a matter which the court required to determine at the stage

of sisting; from which it follows that it is not a matter which the court need, or should,

consider after the action has been sisted. Any principle which can be derived from North

British Railway Co v Newburgh and North Fife Railway Co, above, where the circumstances

were in any event unusual, and where the action was dismissed rather than sisted, has

been modified by the 2010 Act and the mandatory requirement of section 10.

[9]

Accordingly, despite the fact that the pursuer has been unable to articulate what

advantage it would derive from the current action being kept alive, and that it is difficult to

see any benefit to the pursuer in the present action remaining sisted, I am unable to say that

there has been such delay that the action should now be dismissed. For now, the pursuer

is entitled to keep the action in court should it wish to do so; that both parties must incur

some expense in keeping the court up-dated is simply a vagary of litigation (for which

the pursuer might well bear the expense, in due course). It is nothing to the point that the

arbitration is seated in England, as section 10(3) makes clear.

[10]

That all said, I do not consider that it is appropriate for the action to continue on the

commercial roll. Neither party wishes the speedy and efficient determination of the action,

and, as already noted, it is taking up valuable resource.

Disposal

[11]

For all these reasons I have refused the defender's motion to dismiss the action,

but I have withdrawn it from the commercial roll in terms of RCS 47.9 and appointed it to

proceed as an ordinary action, being satisfied that the speedy and efficient determination

of the action is not being served by the action being on the commercial roll. In any event,

neither party wishes the action to continue as a commercial action. Even as an ordinary

action, I do not consider that an indefinite sist is appropriate. Having regard to the likely

minimum future life of the arbitration, I will sist for a period of 1 year and fix a by order

hearing for shortly after the expiry of that sist.