Determining jurisdiction

In most cases the issue of the validity or scope of an arbitration clause comes before the court where party A brings judicial proceedings, and party B seeks a stay in reliance on an alleged arbitration clause. In that type of case the settled approach is that the court will generally make a ruling on jurisdiction on the evidence before it rather than leave it to the arbitrators. In British Telecommunications plc v SAE Group Inc [2009] EWHC 252 (TCC) Ramsey J has decided that an equivalent approach should be adopted where party A seeks a declaration that no arbitration agreement exists.

BT: the facts

The parties entered into an agreement on 14 July 2000 under which SAE Group Inc (‘SAE’) agreed to provide equipment, software and services to British Telecommunications plc (‘BT’), mainly in respect of BT’s outside broadcast operations. The ultimate price agreed, after amendments, was £1.235m. BT had the right to determine the policy on notice, subject to SAE receiving certain payments. Clause 17 of the agreement was in the following terms: