JUDGMENT Panckridge, J. - This is an application under sec. 19 of the Arbitration Act to stay a suit which the Plaintiffs filed on March 7th, 1936. It is common ground that on June 2nd, 1935, an agreement in writing was entered into between the Plaintiffs and the Defendants, which contained a clause, whereby it was provided that in case of disputes between the parties arising out of the agreement, the matter should be submitted to arbitration. The exact form of the arbitration is not material. The contract which was for supply of machinery contained the following clauses relating to payment. Clause 3. The payments shall be made as follows :- 30% Cash with orders against vendors giving Bank guarantee, 60% against shipping documents, 10% at the end of 1935-36 Season with Bank guarantee of vendees. The Plaintiffs' case is that in addition to the written terms there was a term agreed upon orally, which also related to the question of payment. According to the Plaintiffs, the Defendants failed to carry out this term, and I also understand their case to be that Defendants were guilty of a breach of some of the written terms as well. On the 17th of June, 1935, the Plaintiffs wrote to the Defendants a letter, concluding with these words:- In these circumstances it is clear that you are neither ready nor willing to carry out the terms of your contract and you have failed to do so. We had already made the necessary arrangement with our Bankers In the circumstances we have no option but to cancel the contract which we hereby do. 2. The transaction of the 2nd of June, 1935, was not the only transaction between the parties, for, on the 7th June, 1935, the Defendants signed a document whereby they agreed to purchase a boiler from the Plaintiffs on certain terms and conditions. By paragraph 2 of this agreement, the arbitration clause contained in the agreement of June 2nd was made applicable to the agreement of June 7th. The document was signed by a Mr. Sherl who purported to sign for the Managing Director of the Plaintiffs. The Plaintiffs' case is that Mr. Sherl had no authority to sign for the Plaintiffs, and that it was the intention of the parties that the agreement of June 7 should be subject to the approval of Mr. The document was signed by a Mr. Sherl who purported to sign for the Managing Director of the Plaintiffs. The Plaintiffs' case is that Mr. Sherl had no authority to sign for the Plaintiffs, and that it was the intention of the parties that the agreement of June 7 should be subject to the approval of Mr. Kalwas, the Managing Director of the Plaintiffs. The Plaintiffs plead these facts in paragraphs 9 and 10 of their plaint. They also plead that the Defendants are threatening to refer the disputes regarding the agreement of June 2nd and the disputes with regard to the alleged agreement of June 7th to arbitration. 3. They ask for a declaration that the Plaintiffs did not enter into the alleged contract of June 7th and. alternatively, for a declaration that that contract has been validly rescinded. They also ask for a declaration that the contract of June 2nd has been validly rescinded. Another declaration is asked for to the effect that the two contracts are not subsisting. There is also a prayer, asking that the Defendants be restrained by injunction from referring the disputes to arbitration. 4. The Defendants' case is that the disputes between the parties have arisen out of the agreements within the meaning of the arbitration clause in the written agreement of June 2nd, 1935. I entertain no doubt that, with regard to the dispute relating to that particular agreement, the Defendants' contention is justified. In my opinion, the use of the terms " rescission " and " repudiation " by the Plaintiffs is not calculated to throw any light on the matter. When we look at the facts and examine the letter of June 17th on which the Plaintiffs rely as being a rescission or repudiation of the contract the situation seems very simple. Rightly or wrongly the Plaintiffs alleged that the Defendants had defaulted with regard to the provisions of the contract as to payment, and their statement that they have no option but to cancel the contract means no more than this-that the Defendants have lost the right to insist on the Plaintiffs' performing the contract, and that the Plaintiffs do not intend to perform it. 5. 5. I find it very difficult to appreciate the distinction in some of the cases, drawn between a party's saying he will have nothing to do with the contract and his saying that he is under no liability under the contract. The authority to which most frequent reference is made is: Jureidini v. National British and Irish Millers Insurance Company, Limited L. B. [1915] A. C. 499. But the facts of that case differ so widely from the facts here that very little assistance can be derived from it. In that case certain policy-holders sued an Insurance Company on a policy which provided that if the claim were fraudulent, or if the loss were occasioned by the willful act or with the connivance of the insured, all benefits under the policy should be forfeited. There was also a clause in the usual form that if any difference arose as to the amount of any loss, such difference should be referred to arbitration, and that it should be a condition precedent to any right of action upon the policy that the award of the arbitrator or umpire as to the amount of the loss, if disputed, should be first obtained. The Insurance Company invoked the protection of the forfeiture clause, alleging that the loss was due to arson committed by the policyholders. In addition, they relied on the failure of the policy-holders to refer the matter to arbitration. The House of Lords held that the Insurance Company could not treat the arbitration clause as a bar to an action to enforce the claim, while asserting that the policy had been forfeited by the fraud of the policy-holder. In my opinion, that case is not helpful in a discussion whether the disputes between the parties can be said to have arisen out of the agreement within the meaning of the arbitration clause. 6. Another matter relied on is the fact that in the plaint an allegation, which I have already noticed, is made to the effect that the transaction was governed not only by the written terms, but by contemporaneous oral terms. In my judgment it could make no difference if there were an oral stipulation, contemporaneous or subsequent, in addition to the terms contained in the written agreement. The contract is none-the-less a single contract, even though some terms were in writing and others were oral. 7. In my judgment it could make no difference if there were an oral stipulation, contemporaneous or subsequent, in addition to the terms contained in the written agreement. The contract is none-the-less a single contract, even though some terms were in writing and others were oral. 7. In my opinion, the dispute between the parties arose out of the contract of June 2nd, the question being whether the Defendants committed a breach of the terms as regards payment. I think the questions of repudiation and the subsistence of the contract do not really arise. The point is not so much whether the Plaintiffs were justified in repudiating the contract as whether the Defendants committed a breach of the terms. I therefore think the Defendants are entitled to an order staying the suit as far as it concerns the contract of June 2nd, 1935. 8. With regard to the alleged agreement of June 7th, 1935, I refrain from expressing any opinion as to the merits of the respective cases of the parties. There is no doubt that the plaint raises an issue as to the factum of the contract; for, if the gentleman who signed the contract as representing the Plaintiffs had in fact no authority to do so, there was no contract between the parties and, accordingly, no agreement to refer to arbitration. The Defendants urge me to apply the principles enunciated by Rankin, J., in Sardarmull Jessraj v. Agar Chand Mehta and Company 23 C. W. N. 811 (1919). In that case certain parties to a document containing an arbitration clause purported to refer disputes arising out of the agreement contained in the document to arbitration. The Opposite Parties denied the execution of the document, and filed a suit for the purpose of having the document declared ineffective. As soon as the suit was filed they asked for an injunction restraining the Defendants from proceeding with the arbitration pending the hearing of the suit, and Rankin, J., refused the injunction, although he intimated that an injunction should be granted in cases where a contract was impeached upon equitable grounds. The Plaintiffs' application was not one under sec. 19 of the Arbitration Act, since the reference to arbitration preceded the suit. I must confess I have some misgiving as to the correctness of Rankin, J.'s decision. The Plaintiffs' application was not one under sec. 19 of the Arbitration Act, since the reference to arbitration preceded the suit. I must confess I have some misgiving as to the correctness of Rankin, J.'s decision. It is conceded that an arbitrator has no jurisdiction to decide whether the contract containing the arbitration clause was in fact entered into. 9. This being so, it is surely somewhat paradoxical that he should be allowed to go with the arbitration, when the entire substratum of the proceedings is in question. Moreover, after he has made his award it may be that the Court will hold the contract has not been entered into, in which case all the proceedings before him become infructuous. 10. I notice that similar doubts were expressed by Beaumont, C. J., in Ramdas Khatan and Company v. The Atlas Mills Company, Limited ILR 55 Bom. 659 (1930). In my opinion, the true principle is stated in Monro v. Bognor Urban District Council L.R. [1915] 3 K.B. D. 167. There, a party to a contract containing an arbitration clause brought an action against the other party to recover damages for misrepresentation and to have the contract declared void. An application by the Defendants under sec. 4 of the Arbitration Act, 1889 to stay the proceedings and refer the dispute to arbitration was dismissed. Pickford, L. J., observed:- It is, therefore, in no sense an action on the contract at all. Nor do I think that it is an action in relation to or in connection with the contract In one sense it is an action in relation to and in connection with the contract, because if there had never been any contract there would never have been any cause of action, there would never have been any representation, and there would never have been any claim for damages. But it is not in relation to or in connection with the contract, in my opinion, within the meaning of the arbitration clause. If one looks to the substance of the matter, the question resolves itself into the authority of the gentleman acting for the Plaintiffs' Managing Director to sign the document of June 7th, 1935, which incorporated the arbitration clause. That question is beyond the jurisdiction of the arbitrator. If one looks to the substance of the matter, the question resolves itself into the authority of the gentleman acting for the Plaintiffs' Managing Director to sign the document of June 7th, 1935, which incorporated the arbitration clause. That question is beyond the jurisdiction of the arbitrator. I do not think that the suit as far as it deals with that contract, has been shown to be a suit in respect of a matter referred within the meaning of sec. 19 of the Arbitration Act. In any event, the Court's power to stay proceedings is discretionary, and so far as the suit is concerned with the alleged contract of June 7th, I can see no advantage at all but, on the contrary, the possibility of serious complication, if I stay it. So far as the application seeks to stay the suit with regard to the alleged agreement of June 7th, 1935, I dismiss it. The costs of the application are reserved.