SINGAPORE ARBITRATION UPDATE: A POTENTIAL CHANGE FOR ‘OPT-IN’ APPEALS FOR ERRORS OF LAW AND COURT CONFIRMATION OF THE CORRECT STANDARD TO BE MET TO RESTRAIN WINDING UP PROCEEDINGS WHERE A CLAIM IS SUBJECT TO ARBITRATION

Two recent developments in the Singapore arbitration landscape are of interest.  First, a written response from the Singapore Minister for Law confirms that the government is considering amending the International Arbitration Act (the “IAA”) to allow for appeals on errors of law on an opt-in basis. Second, a recent Singapore High Court decision confirms the standard to be met by a party seeking to restrain winding up proceedings when there is a valid arbitration agreement. Underscoring both developments is a common objective of respecting party autonomy in arbitration.

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Singapore court refuses set aside on the basis that the successful party in the arbitration did not call witnesses to give evidence and disclose certain documents

In BVU v BVX [2019] SGHC 69 the High Court of Singapore refused to set-aside an arbitral award on the basis that BVX, the successful party in the arbitration, did not call certain witnesses to give evidence and disclose certain internal documents.  BVU’s attempt to secure these documents by way of subpoena in the context of the set-aside proceedings also failed.  The decision highlights that parties to an international arbitration are normally subject to less stringent requirements for the disclosure of documentary and other evidence.  The decision also emphasises that belated attempts to revisit the merits of a case by procuring additional evidence in the context of set-aside proceedings are unlikely to be successful.

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Should I stay or should I go? Singapore High Court declines to stay arbitration pending review of jurisdictional ruling

Overview

In a recent ex tempore judgment in the case of Loblaw Companies Limited v Origin & Co Ltd & Another [2017] SGHC 59 ("Loblaw v Origin"), the Singapore High Court declined to exercise its discretion under s10(9) of the International Arbitration Act ("IAA"), and refused to stay an arbitration pending final determination by the Singapore courts of a separate application by Loblaw to review the Tribunal's finding on its jurisdiction.

In its decision the High Court acknowledged the lack of authority on when and how a court shall exercise its discretion under s10(9) of the IAA, finding that "[u]ltimately, very much depends on the unique facts and circumstances of each case". However, an applicant would generally be required to show "special circumstances" justifying a stay, over and above the (alleged) merits of the jurisdictional objection or the obvious risk of wasted time and costs.

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‘Bare’ arbitration clauses and the extent to which the Singapore court may assist

In K.V.C Rice Intertrade Co Ltd v Asian Mineral Resources Pte Ltd and another Suit [2017] SGHC 32 ("KVC Action") the Singapore High Court discussed the extent to which the Singapore courts and the Singapore International Arbitration Centre, in its capacity as default appointing authority under the Singapore International Arbitration Act ("IAA"), are able to support and facilitate an arbitration commenced pursuant to a bare arbitration clause which specifies neither the place of arbitration nor the manner in which arbitrators are to be appointed.

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Applicable law of arbitration agreements: Singapore revisits the English case of Sulamérica

In the recent case of BCY v BCZ [2016] SGHC 249, the Singapore High Court considered whether there was a valid and binding arbitration agreement in the context of a negotiated but unsigned contract. The Court comprehensively summarised Singapore's position on determining the governing law of an arbitration agreement, holding that there is a strong presumption that this will be the governing law of the main contract unless this would negate the arbitration agreement.  The judgment provides clarity for clients negotiating contracts which provide for disputes to be resolved by Singapore seated arbitration.

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The Singapore Court adopts a pragmatic approach in its consideration of various aspects of a jurisdictional challenge

In the case of AQZ v ARA , the Singapore High Court has provided useful guidance and clarification on a number of procedural issues relating to jurisdictional challenges which will be of interest to arbitration practitioners both in Singapore and worldwide. The decision provides clarity in relation to the following points:

  1. Where parties have agreed to arbitration under a particular set of institutional rules without any caveat, they agree to submit to all the provisions contained in those rules, even if some of them conflict with other aspects of their agreement, or certain aspects of the procedure fall within the discretion of an arbitrator or the institution. If parties do not wish to agree to future changes in rules, they should specify which particular the version of the rules they want to apply. Further, if, in the context of the SIAC rules, parties want to have their dispute heard by three arbitrators if the Expedited Procedure is invoked, they should make explicit provision for this in their arbitration clause.
  2. In a jurisdictional challenge, although the Court will undertake a “de novo” hearing of an arbitral tribunal’s decision on jurisdiction, this does not mean that oral evidence and cross-examination will be appropriate in every application, even where there are substantial disputes of fact. This pragmatism is welcome, particularly for those on the receiving end of jurisdictional challenges, as the Court’s willingness to rely on material from the arbitration could save significant time and costs in defending such challenges.
  3. In Model Law jurisdictions, once an award on the merits has been handed down, a party who seeks to set it aside on jurisdictional grounds must do so under Article 34 of the Model Law. Article 16(3) of the Model Law is a separate process that only applies to decisions on preliminary questions. If a party wishes to be able to challenge a tribunal’s ruling on jurisdiction shortly after it is handed down, it must ask for that ruling to be given as a preliminary question which does not also deal with the substantive issues in dispute.

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