Stay of judicial proceedings: "inoperative or incapable of being performed"

In Cranium Adspace Ltd v British American Tobacco (New Zealand) Ltd [2016] NZHC 2922 Edwards J in the High Court of New Zealand has rejected the argument that an arbitration clause was inoperative or incapable of being performed simply because a third party had become involved in the dispute.

Cranium: the facts

On 15 May 2014 the parties entered into an agreement under which Cranium agreed to sell advertising space on BATNZ’s tobacco dispensing units. Clause 15 was a dispute resolution clause.