University of Nairobi v N.k. Brothers Limited

The clause uses the phrase 'dispute or difference' and extends to any matter or thing of whatsoever nature arising under or in connection with the contract, including rights and liabilities under specified clauses. Its wording gives rise to a wide interpretation. Consequently, a difference as to what the contractor is entitled to under the contract falls within the clause even if the architect has certified the amounts claimed. The court refused to confine arbitration to disputes between employer and contractor only, excluding the architect acting on the employer's behalf.

The court posed the question whether the employer must pay simply because the architect certified the amount. Applying Halsbury's Laws of England on when a final certificate is conclusive, a certificate binds only if its subject-matter is within the certifier's powers; no clause allowed the architect to certify amounts in excess of the contract sum. The earlier Court of Appeal decisions in Golf Hotels and Gupta were distinguished as summary judgment applications where certificates were not for amounts in excess of the contract sum. The excess claim and the uncontractual 32% interest claim each constituted a dispute, and proof of one suffices.

Section 6(1) obliges a court before which proceedings are brought in a matter subject to an arbitration agreement, on a timely application, to stay the proceedings and refer the parties to arbitration unless the agreement is null and void, inoperative or incapable of being performed, or there is in fact no dispute. The respondent relied on section 6(1)(b), contending there was no dispute because the claim was based on the architect's certificates. The Court of Appeal found there was in fact a dispute as to entitlement, so the statutory bar did not apply and the referral had to be made.