Salford Estates (No.2) Ltd v Altomart Ltd

The Court of Appeal, led by The Chancellor (Sir Terence Etherton), considered whether the mandatory stay in section 9 of the Arbitration Act 1996 applies to a winding-up petition grounded on an unpaid debt under a lease with a broad arbitration clause. Salford Estates (No 2) Limited, landlord and owner of Salford shopping centre, obtained an arbitral award against its tenant, Altomart Limited, for service charge and insurance rent arrears, then presented a petition asserting £92,032.33 including disputed sums for a subsequent year. Judge Bird stayed the petition relying on Rusant and Halki. On appeal, the Court held section 9 does not apply to insolvency petitions because they are not claims for payment and implicate public-interest remedies. Nonetheless, the Court affirmed that the petition should be dismissed or stayed as a matter of discretion under Insolvency Act 1986 section 122(1)(f), to honor the parties’ arbitration agreement. The appeal was dismissed, with Longmore and Kitchin LJJ concurring.