Our law office successfully represented claimants in defeating an invalid arbitration clause and blocking stay of proceedings

This article provides a brief overview of a recent ex tempore decision of the Nicosia District Court, which rejected an application to stay court proceedings on the basis of an alleged arbitration agreement.

The dispute arose in the context of a construction project, where the employers terminated the services of the project’s architect and subsequently filed a lawsuit before the District Court. The claimants alleged overpayment and delays attributable to the architect.

In response, the architect filed an application seeking a stay of the proceedings, arguing that the parties had agreed to resolve their disputes through arbitration.

The Court dismissed the application and ordered the applicant to pay the claimants’ costs. In its ex tempore ruling, the Court found that no valid arbitration agreement existed between the parties.

In particular, the Court examined a document containing an arbitration clause submitted by the defendant. It held that this document did not constitute a binding agreement, as it had been signed by a third party who acted ultra vires and lacked the necessary authority to bind the claimants in an agreement with the architect.

As a result, the Court concluded that the prerequisites for staying the proceedings in favour of arbitration were not satisfied.

The claimants (respondents to the application) were successfully represented by C. Palekythriti Law Office.

This article has been written by Chara Palekythriti, Lawyer - Legal Consultant ©

Disclaimer: This article is for informative purposes only and does not constitute legal advice, opinion or otherwise.