Collins (Contractors) Litd carried out work for Baltic Quay Management under a JCT Minor Works Building Contract. Baltic did not pay an interim certificate and also amounts in respect of the final account but failed to serve a withholding notice. The contractor then determined the contract and issued court proceedings in respect of the amounts.

Baltic applied to the court for a stay of the litigation pursuant to Section 9(4) of the Arbitration Act 1996 on the basis that the contract between the parties contained an arbitration agreement. The contractor argued that there was no arguable defence to the proceedings in the absence of the service of a withholding notice, and therefore there was no “dispute” which was a pre-requisite to the operation of Section 9 of the Arbitration Act 1996.

Did a dispute arise for the purposes of Section 9 of the Arbitration Act 1996 quite simply by a refusal to pay?