Arbitration pre-deposit conditions are enforceable when refundable and adjustable; appointment of an arbitrator does not by itself waive them.

A contractual pre-deposit for invoking arbitration was upheld because the deposit was adjustable against any costs awarded and any balance was refundable, making it materially different from a deposit-at-call clause previously struck down. The Court held that this structure did not make the condition arbitrary or unenforceable. It also held that appointing an arbitrator on the claimant's request did not amount to waiver of the pre-deposit requirement, since the appointing authority had not abandoned the condition and the arbitration was to proceed in accordance with the contract.

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Issues: Whether the contractual pre-deposit condition for invocation of arbitration was arbitrary or unenforceable, and whether appointment of the arbitrator without insisting on pre-deposit amounted to waiver of that condition.

Analysis: The challenged clause required the contractor to furnish a security deposit before the reference to arbitration could be maintained, but unlike the clause struck down in a different case, it provided for adjustment of the deposit against any costs awarded and refund of the balance. The Court held that this distinction was material and that the earlier ruling invalidating a deposit-at-call clause did not apply. It further held that appointment of the arbitrator on the claimant's request did not amount to waiver of the contractual condition, as the appointing authority had not abandoned the requirement and the arbitrator had proceeded on the basis that the dispute had to be decided in accordance with the contract.

Conclusion: The pre-deposit clause was upheld and no waiver was found.

Ratio Decidendi: A contractual pre-deposit condition for arbitration is not arbitrary where the deposited amount is adjustable and refundable in accordance with the award, and mere appointment of an arbitrator does not by itself waive such a condition.

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