In Brisbane Airport Corporation Pty Ltd v Jacobs Group (Australia) Pty Ltd [2025] QSC 349, the Supreme Court of Queensland reaffirmed conventional interpretation principles for tiered dispute resolution clauses in a construction project agreement, and the primacy of arbitration under section 8 of the Commercial Arbitration Act 2013 (Qld).

Jacobs applied for an order that BAC’s proceeding be stayed to allow the parties to follow the dispute resolution procedures in the Varied Deed. It argued that, given the arbitration agreement in clause 23, the Court was required to grant a stay under section 8(1) of the Commercial Arbitration Act 2013 (Qld). That section provides that if an action is brought in a matter which is subject to an arbitration agreement, and if a party so requests, the court must refer the matter to arbitration unless the agreement is null and void, inoperative or incapable of being performed. This provision of the Act is not unique to Queensland, with all other States and Territories having also adopted versions of the UNCITRAL Model Law on International Commercial Arbitration in their own Commercial Arbitration Acts to create a uniform framework for domestic arbitration in Australia.

In the present case, in considering Jacobs’ application, the Supreme Court examined the proper construction of clause 23 and whether the parties’ agreement made arbitration the ultimate means of dispute resolution.

The Court emphasised that where parties have agreed to arbitrate, section 8 is likely to apply to require a stay of court proceedings in favour of arbitration even where the contract requires other steps to be followed first. Non-mandatory language at preliminary stages does not render the agreement optional overall, nor does the failure of intermediate steps affect the operability of the arbitration agreement. Similarly, references to disputes “under the agreement” will ordinarily be read broadly to include both contractual and related non-contractual claims. For these reasons, the Court rejected BAC’s argument that the clause gave the parties an option to litigate and held that compliance with the clause was mandatory.

The Court’s decision is consistent with well-established principles and confirms that courts will adopt a sensible interpretation that respects the parties’ bargain and the legislative policy favouring arbitration. Ultimately, the proceeding was stayed under section 8 pending arbitration.

The decision can be found here.