12 Arbitration

Commercial Practice: Arbitration N.B. The following statutory provisions (“the Act”) are all from the Arbitration Act 2001 unless otherwise specifically stated. Take note of for the exams: Stay of proceedings Removal of arbitrator Setting aside award Appeals Costs – legal costs, sealed letters Legislation and hearing -

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As stated in the Law Commission’s Final Report on The Review of Arbitration Laws: The Arbitration Act 2001 provides for new domestic arbitration laws to be more in line with the UNCITRAL Model Law, and has adopted many useful features from the UK Arbitration Act 1996, which was itself enacted to be in line with the UNCITRAL Model Law. Thus need to refer to both of these statutes to understand our Act better. With regard to application and appeals to the HC, the relevant provisions are contained in O 69 ROC New order 69 nec in 2002 to make it consistent with provn of new act, some amendments since made to O69 in 3005 wrt mode of commencement of proceedings Most matters regd arbitration to be heard by judge in open court though application can be made under O69 r3g to hear matters other than in open court as allowed under s56 arbitration act Reasons for going to arbitration

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Although may not be cheaper, it is meant to be faster than usual litigation. And is also less formal. Privacy can be observed and unnecessary publicity can be avoided. Arbitrators may also mediate. Less formality and more privacy – Unlike a court there is no need to rush there at 10 am, and no need to get scolded by judge. Arbitrator cannot yell or will be seen to be biased. Arbitration comes under ADR, and in the last few years arbitrations have been eclipsed by mediations – and a hybrid has also emerged  Med-Arb.

Definition of “arbitration” -

Arbitration is a process in which two or more persons submit their matters in difference to one or more impartial persons for a binding decision.  Existence of a dispute or matters in difference  A consensual agreement to refer the dispute to a third person and

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A binding decision will be given.

Definition of “domestic arbitration” - It is no longer defined in the new Act. - However, S3 AA states that the Act shall apply to any arbitration: where the place of arbitration is Singapore AND where Part II of the International Arbitration Act does not apply to that arbitration. - It would appear that an arbitration which falls outside International arbitration Act (“IAA”) could be regarded as a domestic arbitration under the new Act. Please see Section 3 of the Arbitration Act. Application of this Act 3. This Act shall apply to any arbitration where the place of arbitration is Singapore and where Part II of the International Arbitration Act (Cap. 143A) does not apply to that arbitration. -

To determine whether an arbitration falls under the International Arbitration Act, it is necessary to look at Section 5 of the International Arbitration Act

Application of Part II 5. —(1) This Part and the Model Law shall not apply to an arbitration which is not an international arbitration unless the parties agree in writing that this Part or the Model Law shall apply to that arbitration. (2) Notwithstanding Article 1 (3) of the Model Law, an arbitration is international if — (a) at least one of the parties to an arbitration agreement, at the time of the conclusion of the agreement, has its place of business in any State other than Singapore; or (b) one of the following places is situated outside the State in which the parties have their places of business: (i) the place of arbitration if determined in, or pursuant to, the arbitration agreement; (ii) any place where a substantial part of the obligations of the commercial relationship is to be performed or the place with which the subject-matter of the dispute is most closely connected; or (c) the parties have expressly agreed that the subject-matter of the arbitration agreement relates to more than one country. (3) For the purposes of subsection (2) — (a) if a party has more than one place of business, the place of business shall be that which has the closest relationship to the arbitration agreement; (b) if a party does not have a place of business, a reference to his place of business shall be construed as a reference to his habitual residence. (4) Notwithstanding any provision to the contrary in the Arbitration Act (Cap. 10), that Act shall not apply to any arbitration to which this Part applies. Juridical Seat

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Juridical Seat = ‘the place of the arbitration’. This concept determines the rules of procedure applicable to an arbitration, and basically refers to the domicile or juridical capital of the arbitration. It is something like the nationality of the arbitration, and is more relevant for international arbitrations. A domestic arbitration cannot be made subject to a foreign law. One of the new concepts expressly enacted into the new Act is the concept of a ‘juridical seat’ as “the place of arbitration” in s 2 AA. - It fills in a lacuna which existed under the previous Act. - This concept would determine the rules of procedure applicable to an arbitration. - The ‘juridical seat’ is a specific reference to the domicile or juridical capital of the arbitration – like the nationality of the arbitration, and the place where the arbitration draws its legal legitimacy. It is to be distinguished from the place where the hearing is merely held. s 2: “the place of arbitration” means the juridical seat of arbitration designated by: - The parties to the arbitration agreement - Any arbitral or other institution or person authorised by the parties for that purpose, or - The arbitral tribunal as authorised by the parties, or - determined in the absence of such designation, having regard to the arbitration agreement and all the relevant circumstances.

The Arbitration Agreement -

To be able to proceed with arbitration one would require an ‘arbitration agreement’. In the new Act, the requirements of an arbitration agreement are more extensively dealt with.

Definition of “agreement” Arbitration agreement 4. —(1) In this Act, “arbitration agreement” means an agreement by the parties to submit to arbitration all or certain disputes which have arisen or which may arise between them whether contractual or not. (2) An arbitration agreement may be in the form of an arbitration clause in a contract or in the form of a separate agreement. (3) An arbitration agreement shall, except as provided for in subsection (4), be in writing, being contained in — (a) a document signed by the parties; or (b) an exchange of letters, telex, telefacsimile or other means of communication which provide a record of the agreement. (4) Where in any arbitral or legal proceedings, a party asserts the existence of an arbitration agreement in a pleading, statement of case or any other document in circumstances in which the assertion calls for a reply and the assertion is not denied, there

shall be deemed to be an effective arbitration agreement as between the parties to the proceedings. (5) A reference in a bill of lading to a charterparty or other document containing an arbitration clause shall constitute an arbitration agreement if the reference is such as to make that clause part of the bill of lading. -

Under s 4(1) an arbitration agreement means an agreement by parties to submit to arbitration - All or certain disputes - Which have arisen - Or which may arise - Whether contractual or not.

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I.e. there is thus no requirement that disputes be contractual in nature. could be tortious too?

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Under Section 4(2), an arbitration agreement may be in the form of an arbitration clause in a contract or in the form of a separate agreement

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An arbitration clause in ordinary terms is usually, and has been held to be, a self -contained contract collateral to the containing contract. As with any other contract, it must be construed according to its terms in and with regard to the relevant factual situation. o (as per C.A. Ralph Gibson in Harbour Assurance v Kansa Gen Ins)

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An “Arbitration agreement” is to be in writing except where Section 4(4) Arbitration Act applies. o As with the previous Act, the agreement must be in writing: s 4(3). o However, our new Act includes the French and German civil law concepts as embodied in the A7 of Model Law, and now the agreement need not be contained in any particular document and can be constituted by an exchange of letters, telex, telefascimile or other means of communication which provide a record of the agreement: s 4(3)(b). o And, unlike the previous Act, an exception to the requirement of a written agreement is embodied in s 4(4): o Where in arbitral or legal proceedings, a party assets the existence of an arbitration agreement in a pleading or other document which calls for a reply, and the assertion is not denied, there shall be deemed to be an effective arbitration agreement between the parties.

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S 4(5) also states that a reference in a B/L to a CP or other documents containing an arbitration clause, shall constitute an arbitration agreement if the reference is such as to make that clause part of the bill of lading. - seems to buttress s 4(2). - Note: our s 4 of the new Act is in pari materia with the Art 7(1) and (2) of the Model Law.

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Parties must be of one mind: Where in action for price of goods sold, a “bought note” signed by the defendants contained a provision for arbitration, while in a “sold note” signed by the Plaintiffs that provision was absent. I - t was held that there was no written agreement for arbitration because both parties had not signed the agreement. Carleon Tinplace Co v Hughes (1891) 60 LJ QB 640 Sufficient writing if proved that party is contractually bound by the arbitration agreement incorporated in the document. - Zambia Steel v Clark & Eaton [1986] 2 LLR 225 Silence to subsequent imposition of arbitration clause will not amount to an agreement to arbitrate. - United Engineers Contractors v L & M Concrete Specialists Pte Ltd [2000] 2 SLR 196. Oral agreement reached and parties began performance. Written letter of award sent by Defendant to Plaintiff requiring signature. Letter made reference to “Standard Conditions of Subcontract”. There was no such document but a special contract, which had an arbitration clause. - Selvam J held that:“there was no written agreement to arbitrate because, the terms of the so-called letter of award were not accepted by the plaintiffs and in any event there were no “standard conditions” which the plaintiffs could agree to accept” Minutes recording agreement to arbitrate, naming and appointing arbitrator held to be sufficient writing. See Sebor (Serawak) Marketing v SA Shee [2000] 6 MLJ 1 (Kuching HC) Some arbitration clauses may be simple, but others, such as in building contracts, could be quite detailed and complex. Some arbitration clauses may incorporate what is known as the “Scott v Avery [1856] clause”. It will provide that arbitration is a condition precedent to the commencement of any action in law, and that the obligation shall be to pay a sum as may be awarded upon arbitration pursuant to this clause. - By virtue of this clause a Court cannot order a stay of proceedings. - However, the Court (High Court) has power to revoke the authority of arbitrators who are impartial. In so doing the Court is entitled to order that the arbitration clause shall cease to have effect with respect to that particular dispute. Thus, in such a case, the court can order that the Scott v Avery clause ceases to be effective. A further development of the Scott v Avery clause is the Atlantic Shipping clause [Atlantic Shipping v Dreyfus [1992]]. - This clause limits the time for making the claim and the appointment of the arbitrator.

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Beyond such specified period any claim not so made will be deemed to be waived and absolutely barred. However, under Section 10 of the new Arbitration Act, the court has the power to extend the time given, even if it has already expired, if the court is of the opinion that undue hardship would be caused.

Section 5 of the new Act lays down the principle that an arbitration agreement is not to be discharged by the death of a party.

Arbitration agreement not to be discharged by death of party 5. —(1) An arbitration agreement shall not be discharged by the death of any party to the agreement but shall continue to be enforceable by or against the personal representative of the deceased party. (2) The authority of an arbitrator shall not be revoked by the death of any party by whom he was appointed. (3) Nothing in this section shall be taken to affect the operation of any written law or rule of law by virtue of which any right of action is extinguished by the death of a person. Choice/Appointment of Arbitrators: Arbitral Tribunal 

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Depending on the subject matter of the dispute, you may wish to get people skilled with expertise in the area e.g. a master mariner for maritime arbitrations, an architect or quantity surveyor for construction disputes. Some lawyers may generally be good all around and in more formal arbitrations that would involve difficult points of law, lawyer arbitrators actually may be preferred. Even then the parties may wish a lawyer and a non-lawyer to be arbitrators. Having a single arbitrator is cheaper on the pocket. May want to give a choice of a few arbitrators so that the other party can choose accordingly. See Section 12(2) of the new Act.

Number of arbitrators 12. —(1) The parties are free to determine the number of arbitrators. (2) Failing such determination, there shall be a single arbitrator.  As under the Schedule 1 of the previous Act, the parties are free to determine the no. of arbitrators to be appointed: s 12(1) new AA, failing which there shall be a single arbitrator: s 12(2).  This however differs from the position under the Model Law, which states: - “Article 10. Number of arbitrators The parties are free to determine the number of arbitrators. Failing such determination, the number of arbitrators shall be three.” 

Special qualifications/disqualifications

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“commercial men” – Palmco Shipping v Continental Ore Corp, “The Captain George K” [1970] 2 Llyods Rep 21, retired solicitor practicing as maritime arbitrator accepted as “commercial man”. “shipping man” – Owners of The Myron v Tradax Export SA [1970] 1 QB 527 where a full time maritime arbitrator was held to be a “shipping man”.

Appointment by Institutions (e.g.) - SIAC - Law Society - Institute of Architects - Institute of Arbitrators - Institute of Professional Engineers - Other industry bodies However, following Art 11 Model Law, s 13(1) states that no person shall be precluded from being arbitrator by reason of his nationality. o this is odd in a domestic AA and has been excluded in the Eng AA. If the parties cannot agree on the procedure for appointing arbitrator(s) as allowed under s 13(2), the appointing authority will appoint the arbitrator: s 13(3)(b) and s 13(4). The new Act thus differs from the previous act in that an ‘appointing authority’ in the form of the Chairman of the SIAC, has been introduced: s 13(8). The SIAC is actively involved in both domestic and international arbitrations and looks forward to being a paramount body overseeing arbitration in Singapore Through its regular contact with arbitrators and administration of arbitration cases, the SIAC is well informed about the capabilities of potential appointees to make appropriate decisions in appointment matters. The CJ may also appoint any other person to exercise the powers of the appointing authority by notification in the Gazette: s 13(9). Appointment of arbitrators 13. —(1) Unless otherwise agreed by the parties, no person shall be precluded by reason of his nationality from acting as an arbitrator. (2) The parties are free to agree on a procedure for appointing the arbitrator or arbitrators. (3) Where the parties fail to agree on a procedure for appointing the arbitrator or arbitrators — (a) in an arbitration with 3 arbitrators, each party shall appoint one arbitrator, and the parties shall by agreement appoint the third arbitrator; or (b) in an arbitration with a sole arbitrator, if the parties are unable to agree on the arbitrator, the arbitrator shall be appointed, upon the request of a party, by the appointing authority.

(4) Where subsection (3) (a) applies — (a) if a party fails to appoint an arbitrator within 30 days of receipt of a first request to do so from the other party; or (b) if the 2 parties fail to agree on the appointment of the third arbitrator within 30 days of the receipt of the first request by either party to do so, the appointment shall be made, upon the request of a party, by the appointing authority. (5) If, under an appointment procedure agreed upon by the parties — (a) a party fails to act as required under such procedure; (b) the parties are unable to reach an agreement expected of them under such procedure; or (c) a third party, including an arbitral institution, fails to perform any function entrusted to it under such procedure, any party may apply to the appointing authority to take the necessary measure unless the agreement on the appointment procedure provides other means for securing the appointment. (6) Where a party makes a request or makes an application to the appointing authority under subsection (3), (4) or (5), the appointing authority shall, in appointing an arbitrator, have regard to the following: (a) the nature of the subject-matter of the arbitration; (b) the availability of any arbitrator; (c) the identities of the parties to the arbitration; (d) any suggestion made by any of the parties regarding the appointment of any arbitrator; (e) any qualifications required of the arbitrator by the arbitration agreement; and (f) such considerations as are likely to secure the appointment of an independent and impartial arbitrator. (7) No appointment by the appointing authority shall be challenged except in accordance with this Act. (8) For the purposes of this Act, the appointing authority shall be the Chairman of the Singapore International Arbitration Centre. (9) The Chief Justice may, if he thinks fit, by notification published in the Gazette, appoint any other person to exercise the powers of the appointing authority under this section. 

The grounds in challenge and the challenge procedure of arbitrators who are appointed are laid down Sections 14 & 15 of the new Act.

Grounds for challenge

14. —(1) Where any person is approached in connection with his possible appointment as an arbitrator, he shall disclose any circumstance likely to give rise to justifiable doubts as to his impartiality or independence.1 (2) An arbitrator shall, from the time of his appointment and throughout the arbitration proceedings, disclose without delay any such circumstance as is referred to in subsection (1) to the parties unless they have already been so informed by him. (3) Subject to subsection (4), an arbitrator may be challenged only if — (a) circumstances exist that give rise to justifiable doubts as to his impartiality or independence; or (b) he does not possess the qualifications agreed to by the parties. (4) A party who has appointed or participated in the appointment of any arbitrator may challenge such arbitrator only if he becomes aware of any of the grounds of challenge set out in subsection (3) as may be applicable to the arbitrator after the arbitrator has been appointed. Challenge procedure 15. —(1) Subject to subsection (3), the parties are free to agree on a procedure for challenging an arbitrator. (2) If the parties have not agreed on a procedure for challenge, a party who intends to challenge an arbitrator shall — (a) within 15 days after becoming aware of the constitution of the arbitral tribunal; or (b) after becoming aware of any circumstance referred to in section 14 (3), send a written statement of the grounds for the challenge to the arbitral tribunal. (3) The arbitral tribunal shall, unless the challenged arbitrator withdraws from his office or the other party agrees to the challenge, decide on the challenge. (4) If a challenge before the arbitral tribunal is unsuccessful, the aggrieved party may, within 30 days after receiving notice of the decision rejecting the challenge, apply to the Court to decide on the challenge and the Court may make such order as it thinks fit. (5) No appeal shall lie against the decision of the Court under subsection (4). (6) While an application to the Court under subsection (4) is pending, the arbitral tribunal, including the challenged arbitrator, may continue the arbitration proceedings and make an award. 

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Rules of nat justice preserved as arbitrator concerned can appear and be heard by court - But no appeal fr order of court

In AT & T Corp v Saudi Cable Co [2000] 1 LLR 22 – Chairman of tribunal was non-executive director of Northern Telecoms, a competitor of AT & T in the bid for contract with Saudi Cable. Award was made against AT & T who then applied to remove him and set aside award on the ground of bias. Application failed as they was no danger of “unconscious bias”. Court applied “real likelihood (in the sense of real danger) of bias test.

Decision by panel of arbitrators 19. —(1) In arbitration proceedings with more than one arbitrator, any decision of the arbitral tribunal shall be made, unless otherwise agreed by the parties, by all or a majority of all its members. (2) Any question of procedure may be decided by a presiding arbitrator if so authorised by the parties or all members of the arbitral tribunal.  

Otherwise all arbitrators will decide Note however that the term “presiding arbitrator” is not defined. Eng concept of umpire not used.

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Under Section 20, it is now clear that the arbitrators now enjoy immunity from their acts as arbitrator, or in arbitration proceedings or in making an arbitral award. This makes the law in pari materia with Section 25 of the IAA (the wording of Section 20 Arbitration Act and Section 25 IAA is exactly the same).

Liability of arbitrator 20. An arbitrator shall not be liable for — (a) negligence in respect of anything done or omitted to be done in the capacity of the arbitrator; or (b) any mistake of law, fact or procedure made in the course of arbitration proceedings or in the making of an arbitral award. Fees of Arbitrators and costs of arbitration Depends on the particular arbitrator and from arbitration to arbitration, arbitrators may charge about $1000 to $2000 per day of arbitration. There is also the question of fees for writing the award. It may be substantial ($5000 to $10,000).  Some may be appted by trade assoc – fees are small or negligible  Different arbitrators command different fees.  Usually the “one-off” arbitrations or the ones which are more formal or complicated that fees can be quite high ° Most professionals (lawyers, engineers, quantity surveyors, architects etc) charge about $1000 – $2000 per day (5 hours a day). Some senior lawyers charge $3000 a day - Fees for writing the award can range from $5000 to $10000. Parties to an arbitration will have to make it clear whether they want a “reasoned award” under s28(6) AA. When they make this decision, it is also an appropriate time to settle the fees for writing the award - Some arbitrators also charge for interlocutory matters, and in such matters, they may charge ($50 per module of 10 minutes or $300 per hour). 

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There has also been a tendency to use arbitration as a means to settlement. Thus, even after reference to arbitration proceedings and sometimes even on the morning of the arbitration, the parties may come to a settlement. The arbitrator may have done some getting up on the pleadings and the bundles of documents would have been

exchanged at the time. Some arbitrators therefore feel that in such cases preliminary “getting-up” fees is fair and reasonable. -

Arbitrators can also charge for any work done before the matter actually goes to arbitration – preliminary “getting up” fees  K/S Norjarl A/J v Hyundai Heavy Industries Co Ltd (1991)  The arbitrators asked for a proportion of their fees in advance as security for loss of remuneration should the dispute be resolved prior to the hearing.  Hyundai alleged that this amounted to technical misconduct  Held: (CA) There was no misconduct. The arbitrators were entitled to reasonable remuneration for work done  The CA remarked that if however the arbitrators wished to insist on a commitment fee, the proper time to do so was before the appointment was accepted

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Sections 39, 40, 41 and 42 governs the costs of the arbitration and arbitrator’s fees. As in litigation, under Section 39(1), costs can be taxed or agreed. It is apparently regarded as being against public policy to agree in an arbitration agreement that each party will only bear their own costs for disputes going to arbitration. It is however possible to so agree if the dispute had arisen before the Agreement was made.

Costs of arbitration 39. —(1) Any costs directed by an award to be paid shall, unless the award otherwise directs, be taxed by the Registrar of the Supreme Court within the meaning of the Supreme Court of Judicature Act (Cap. 322). (2) Subject to subsection (3), any provision in an arbitration agreement to the effect that the parties or any party shall in any event pay their or his own costs of the reference or award or any part thereof shall be void; and this Act shall, in the case of an arbitration agreement containing any such provision, have effect as if there were no such provision. (3) Subsection (2) shall not apply where a provision in an arbitration agreement to the effect that the parties or any party shall in any event pay their or his own costs is part of an agreement to submit to arbitration a dispute which has arisen before the making of such agreement. (4) If no provision is made by an award with respect to the costs of the reference, any party to the reference may, within 14 days of the delivery of the award or such further time as the arbitral tribunal may allow, apply to the arbitral tribunal for an order directing by and to whom such costs shall be paid. (5) The arbitral tribunal shall, after giving the parties a reasonable opportunity to be heard, amend its award by adding thereto such directions as it thinks fit with respect to the payment of the costs of the reference. 

Under Section 40, parties are jointly and severally liable to their arbitrators for their fees. It does not matter who had nominated the arbitrator or appointed the arbitrator. Such fees can be taxed in the Supreme Court. However, fees may have been fixed by

agreement or by some institution agreed by the parties (e.g. SIAC). There will be no taxation in such cases.

Fees of arbitrator 40. —(1) The parties are jointly and severally liable to pay to the arbitrators such reasonable fees and expenses as are appropriate in the circumstances. (2) Unless the fees of the arbitral tribunal have been fixed by written agreement or such agreement has provided for determination of the fees by a person or institution agreed to by the parties, any party to the arbitration may require that such fees be taxed by the Registrar of the Supreme Court within the meaning of the Supreme Court of Judicature Act (Cap. 322). 

Under Section 41, the arbitral tribunal may refuse to deliver an award if the expenses and fees of arbitrators have not been fully paid. However, their claims may be taxed by the Court, if an application is made. The Court may order the disputed amount (or lesser sum) to be paid into Court pending taxation. After taxation, any balance sum will be paid back to the applicant.

Power to withhold award in case of non-payment 41. —(1) The arbitral tribunal may refuse to deliver an award to the parties if the parties have not made full payment of the fees and expenses of the arbitrators. (2) Where subsection (1) applies, a party to the arbitration proceedings may, upon notice to the other parties and the arbitral tribunal, apply to the Court, which may order that — (a) the arbitral tribunal shall deliver the award upon payment into Court by the applicant of the fees and expenses demanded, or such lesser amount as the Court may specify; (b) the amount of the fees and expenses demanded shall be taxed by the Registrar of the Supreme Court; and (c) out of the money paid into Court, the arbitral tribunal shall be paid such fees and expenses as may be found to be properly payable and the balance of such money (if any) shall be paid out to the applicant. (3) A taxation of fees under this section shall be reviewed in the same manner as a taxation of costs. (4) The arbitrator shall be entitled to appear and be heard on any taxation or review of taxation under this section. (5) For the purpose of this section, the amount of fees and expenses properly payable is the amount the applicant is liable to pay under section 40 or under any agreement relating to the payment of fees and expenses of the arbitrators. (6) No application to the Court may be made unless the Court is satisfied that the applicant has first exhausted any available arbitral process for appeal or review of the amount of the fees or expenses demanded by the arbitrators. (7) This section shall apply to any arbitral or other institution or person vested with powers by the parties in relation to the delivery of the award by the tribunal and any

reference to the fees and expenses of the arbitrators shall be construed as including the fees and expenses of that institution or person. (8) The leave of the Court shall be required for any appeal from a decision of the Court under this section. 

Under Section 42, Section 117 of the Legal Profession Act (allowing charge for payment of solicitors’ costs) is applicable to arbitration proceedings.

Court may charge property with payment of solicitor’s costs in arbitration 42. Section 117 of the Legal Profession Act (Cap. 161) (which empowers a Court in which a solicitor has been employed in any proceeding to charge property recovered or preserved in the proceeding with the payment of his costs) shall apply as if an arbitration were a proceeding in the Court, and the Court may make declarations and orders accordingly. Section 117 Legal Profession Act Charging orders 117. —(1) Any court in which a solicitor has been employed to prosecute or defend any suit, matter or proceeding may — (a) at any time declare the solicitor entitled to a charge on the property recovered or preserved through his instrumentality for his taxed costs in reference to that suit, matter or proceeding; and (b) make such orders for the taxation of the costs and for raising money to pay, or for paying, the costs out of that property as it thinks fit. (2) All conveyances and acts done to defeat, or operating to defeat, the charge referred to in subsection (1) (a) shall, except in the case of a conveyance to a bona fide purchaser for value without notice, be void as against the solicitor. (3) No order shall be made under subsection (1) if the right to recover the costs is barred by the Limitation Act (Cap. 163). Some Practical Observations on Costs 

It should be known from the outset that costs can be very high and even prohibitive. This would be true where small sums are involved and lawyers are engaged. The total costs may exceed the amount in dispute.

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One has to pay two types of costs: o Costs of the award; and o Costs of the arbitration

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Costs of the award would include the arbitrator’s fees (may be 2 or more of them), costs of the hearing room, cost of secretarial services and transcripts, costs for writing the award, and other expenses. A lump sum is usually negotiated which may be expensive (e.g. $10,000 for a small award of less than 10 pages).

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Costs of the arbitration would include the usual party & party costs that one has to pay in litigation. In an arbitration involving more than two weeks, a figure of $100,000 or more would not be unusual. Such costs are (as in litigation) in the discretion of the arbitrator.

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There is a tendency to make what is called a “sealed offer”. I.e. a sum is offered in settlement and made known to the other party but not to the arbitrator. The arbitrator will be given a sealed envelope at the end of the hearing.

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The effect of a sealed offer is similar to that of depositing money in Court. The party refusing such an offer would have to bear the costs from the date of such refusal, if the Arbitrator awards a sum less than contained in the offer.

Tramountana Armadora SA v Atlantic Shipping Co SA [1978] 2 All ER 870 - A 'sealed offer' is the arbitral equivalent of making a payment into Court in settlement of the litigation or of particular causes of action in that litigation. Neither the fact, nor the amount, of such a payment into Court can be revealed to the Judge trying the case until he has given judgment on all matters other than costs. As it is customary for an award to deal at one and the same time both with the parties' claims and with the question of costs, the existence of a sealed offer has to be brought to the attention of the arbitrator before he has reached a decision. However, it should remain sealed at that stage and it would be wholly improper for the arbitrator to look at it before he has reached a final decision on the matters in dispute other than as to costs, or to revise that decision in the light of the terms of the sealed offer when he sees them…. - The offer in the present case was a 'sealed offer' and was, I think, treated as such so far as the amount is concerned. It was thus intended to be analogous to a payment into Court. A payment into Court can only be made in respect of the principal sum claimed and any contractual claim for interest. ….. But so far as costs are concerned, the order will take account of whether, ignoring interest, he has recovered more than had been paid into Court. If he recovers more, he will usually be awarded the whole party and party costs of his claim. If he recovers the same or less than has been paid into Court, he will recover his costs up to the date of payment into Court, but will have to pay any costs which the other party has incurred thereafter…… - The position of a 'sealed offer' in arbitration has to be considered against the background of the law relating to payments into Court, but it is not necessarily the same because the Rules of the Supreme Court do not apply to arbitrations. I can see no reason in principle or practice why a 'sealed offer' should not be expressed to relate to 1934 Act interest as well as to principal. Indeed, I think it should, because, if it is accepted, the arbitrator will have no power to make an award of interest by itself. This stems from the wording of the 1934 Act and its application by analogy to arbitral awards. - How should an arbitrator deal with costs where there has been a 'sealed offer'? I think that he should ask himself the question: 'Has the claimant achieved more by rejecting the offer and going on with the arbitration than he*398 would have achieved if he had accepted the offer?'. This is a simple question to answer, whether the offer does or

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does not include interest. The arbitrator knows what the claimant would have received if he had accepted the offer. He would have received that sum and could not have asked the arbitrator to award any interest. The arbitrator knows what he has in fact awarded to the claimant both by way of principal and interest. In order that like should be compared with like, the interest element must be recalculated as if the award had been made on the same date as the offer. Alternatively, interest for the period between offer and award must notionally be added to the amount of the sealed offer. But, subject to that, the question is easily answered. If the claimant in the end has achieved no more than he would have achieved by accepting the offer, the continuance of the arbitration after that date has been a waste of time and money. Prima facie, the claimant should recover his costs up to the date of the offer and should be ordered to pay the respondent's costs after that date. If he has achieved more by going on, the respondent should pay the costs throughout. Let me stress, however, that while this is the general rule, there is an overriding discretion. If, for example, the way in which the claimant conducted the arbitration in the period before the sealed offer was made is open to criticism, this may be a ground for depriving him of all or part of his costs or even, in a very extreme case, of requiring him to pay all or part of the costs of the respondent. Conversely, if after the sealed offer has been made and rejected, the conduct of the respondent is open to criticism, this may be a ground for depriving the respondent of all or part of the costs incurred by him in this period and might even, in a very extreme case, justify an order that he pay all or part of the claimant's costs.

Everglade Maritime Inc v Schiffahrtsgesellschaft Detlef von Appen mbH ”The Maria” [1993] 3 All ER 748 - Facts - O claimed for unpaid hire. C made a sealed offer of settlement to include interest and costs. Arbitrators awarded O a sum slightly, but not minimally, in excess of the offer made plus interest and reserved costs. After considering costs in the light of the sealed offer and written submissions, the arbitrators decided, inter alia, that O should pay C's costs from a date shortly after the date of the sealed offer. They reasoned that, but for the sealed offer, O's conduct in the arbitration would have justified an order that each party bear its own costs and accordingly, although O had achieved a greater amount as to principal and interest than that offered, they had lost a greater sum by way of costs. O successfully appealed and the judge varied the award by a direction that each party bear its own costs. C appealed. - Held, by C.A. (KENNEDY AND EVANS, L.JJ.; Sir THOMAS BINGHAM, M.R., dissenting) - (1) in a commercial arbitration a sealed offer was regarded as similar in its effect to a payment into Court or to a written offer without prejudice save asto costs and tt in general costs followed the event. The courts shld take not account of the incidence of costs in the reference but should only have regard to the claim for principal and interest. - (2) the arbitrator must not be influenced by unverified and extraneous facts; the discretion was absolute and was to be exercised judicially; on the authorities a commercial arbitrator did not have any wider discretion as regards costs than the

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Judge; and an arbitrator erred in law if he did not exercise the discretion to award costs otherwise than in accordance with the restraints imposed by law upon a Judge (3) payment in was regulated by Rules of the Court which did not apply either to arbitrators or to sealed offers in particular but the question to be posed was whether the arbitrator was required by law to make equivalent orders in the case of a sealed offer to pay a stated amount in respect of the claim; and the arbitrators were right to ask themselves the question: had the claimant achieved more by rejecting the offer and going on with the arbitration than he would have achieved if he had accepted the offer -Tramountana Armadora S.A. v. Atlantic Shipping Co. S.A., [1978] 1 Lloyd's Rep. 391 applied; (4) the answer to that question was clear but it depended on whether costs were taken into account or not; if costs were taken into account then the excess recovery could not be disregarded; the offer was exceeded by a non-negligible amount (5) the law did not require or permit arbitrators or Judges to have regard to the likely incidence of post-offer costs whatever might be the position regarding the claimant's own pre-offer taxed costs; in this case the offer was $15,000 plus costs; the award was $16,214 without costs and the claimant's pre-offer costs likely to be recovered on taxation clearly were more than $1215 so that the claimants were worse off for going on because the additional hire which was awarded to them was less than the costs which they did not recover but which had been offered to them (6) the charterers should not be permitted to say that the offer of $15,000 in respect of hire should now be treated as if it was an offer of $16,215 or more merely because their further offer of costs was proved by subsequent events to have been unnecessary; costs were offered because they were regarded as ancillary to the claim; in the result the charterers successfully objected to that ancillary order being made and they could not now say that the offer to pay costs should be treated as if it were a supplementary offer to pay more than $15,000 in respect of the claim; the appeal would be dismissed Sir Thomas Bingham MR (as he then was) took the view that it must be shown that the arbitrator’s order was not lawfully made. He felt in that case that the finding of the arbitrators but for the sealed offer they would have awarded the owners none of the costs of the reference, provided relevant ground on which they could properly conclude that the owners fared worse, and not better, in pressing on with their claim.

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Although costs are in the discretion of the arbitrator, many arbitrators hear the parties on costs after an award is given. Most arbitrators would follow the general rule (where there are no sealed offers) that costs follow the event.

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There is a tendency to argue that the party in whose favour the award is made should not get full costs, if he had lost on important issues. Costs may be awarded to the other party, if it can be shown that these issues should never have been raised, and/or contributes an abuse of process.

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Where there are counter-claims, costs can be awarded separately for the counterclaims.

Stay of Legal Proceedings Requirements 

This is a technicality before arbitration. A stay of proceedings must be filed after appearance and before taking any steps in the proceedings.

Stay of legal proceedings 6. —(1) Where any party to an arbitration agreement institutes any proceedings in any court against any other party to the agreement in respect of any matter which is the subject of the agreement, any party to the agreement may, at any time after appearance and before delivering any pleading or taking any other step in the proceedings, apply to that court to stay the proceedings so far as the proceedings relate to that matter. (2) The court to which an application has been made in accordance with subsection (1) may, if the court is satisfied that — (a) there is no sufficient reason why the matter should not be referred in accordance with the arbitration agreement; and (b) the applicant was, at the time when the proceedings were commenced, and still remains, ready and willing to do all things necessary to the proper conduct of the arbitration, make an order, upon such terms as the court thinks fit, staying the proceedings so far as the proceedings relate to that matter. (3) Where a court makes an order under subsection (2), the court may, for the purpose of preserving the rights of parties, make such interim or supplementary orders as the court thinks fit in relation to any property which is or forms part of the subject of the dispute to which the order under that subsection relates. (4) Where no party to the proceedings has taken any further step in the proceedings for a period of not less than 2 years after an order staying the proceedings has been made, the court may, on its own motion, make an order discontinuing the proceedings without prejudice to the right of any of the parties to apply for the discontinued proceedings to be reinstated. (5) For the purposes of this section, a reference to a party includes a reference to any person claiming through or under such party. o

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S 6 of the new Act is similar to s 7 of the old act permitting an application for stay of legal proceedings instituted in respect of any matter which is the subject of the arbitration agreement at any time after appearance, and before delivering pleadings or taking any other step in the proceedings so far as the proceedings relate to that matter. As with the old s 7(2), the new s 6(2) lays down the requirements before the court will order a stay”: There must be no sufficient reason why the matter should not be referred to arbitration; AND The applicant must be ready and willing to do all things necessary for the proper conduct of the arbitration

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Tan Hock Leng v Sigma International Ltd (OS 1110/1988 HC) - Chan Sek Keong J took the view that as the defendant had contested the plaintiff’s application to re-mend the writ and had mentioned for the plaintiff’s solicitors, it would amount to taking a step in the proceedings. This barred them from obtaining a stay.

The arbitration clauses usually refer to a “dispute” between the parties: o Haiki Shipping Corporation v Sopet Oils Ltd [1997] 1 WLR 1268 o It was held that the term “dispute” as sused includes any claim which the other party refused to admit or did not pay, whether or not there was any answer to the claim in fact or in law. It was also pointed out that under Section 9(4) of the English Arbitration Act 1996, the Court was bound to stay proceedings in respect of any dispute within the arbitration agreement. o

JDC Corporation & Anor v Lightweight Concrete Pte Ltd (1999)  Issue: was there a dispute?  Held: once the disputes have been made out, and they fall within the ambit of the Arbitration Agreement, there was no sufficient reason for not granting stay of proceedings -

In Four Pillars Enterprises Co Ltd v Beiersdorf Aktiengesellschaft [1999] 1 SLR 737, the Court of Appeal refused to stay winding up proceedings brought by the respondent against the joint venture company. The application for stay was made by the appellants under Section 7 of the previous Arbitration Act, as they were one of the parties to the joint venture agreement. It was held that there was sufficient reason for not granting a stay of the winding up proceedings sought by the respondents, as the said relief for winding up was not available in arbitration. Only a court could grant such a relief.

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SA Shee & Co (Pte) Ltd v Kaki Bukit Industrial Park Limited [2000] 2 SLR 12 o In that case, a contractor commenced action claiming payment under 5 architect’s certificates issued pursuant to Building Contract. CA upheld the decision of the HC that there were triable issues, which fell within clause 37(1) of the SIA conditions and should be referred to arbitration. Hence the HC had correctly stayed the proceedings under Section 7 of the previous arbitration act.

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In Chong Long Hak Kee Construction Trading Co v IEC Global Pte Ltd [2003] 4 SLR 499, the question of the exercise of discretion by the court in granting stay was considered. o In that case, an application for stay of legal proceedings was filed by the Defence at the same time with the Defence; but the defendants also stated in the Defence that it was being filed without prejudice to its right to stay the proceedings. The court pointed out that since a step in the proceedings had been taken, it would have no discretion to stay the proceedings. However, where such steps were made with the express reservation of the rights under

the arbitration agreement, the defendant’s right to stay the proceedings would be preserved. Nonetheless, as a Counterclaim had been served together with the defence, the defendants had shown that it was serious enough to pursue the same in a court of law and not in arbitration. Hence the stay application was dismissed. -

Australian timber prodts v koh brothers building and civil engineering contractor 2005 1 SLR 168 – relevant to meaning of ‘step in the proceedings’ under 6.1 of AA o Belinda Ang J took view tt step means any step which affirms correctness of proceedings or demonstrates a willingness or intention to defend substance of claim in court instead of arbitration o Additionally no such step if specific statement tt applicant intends to seek stay or expressly reserves his right to do so o Learned judge noted tt def clearly intended to seek stay o Also fact tt def had applied ot have default judgement set aside was not step in proceedings

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Yee Hong v Chan Chye Yee Andrew 2002 4 SLR 398 – impt pt of law raised regarding juris of court in rlation to stay of proceedings o Case involved three parties – plaintiff (main contractor), def (architect), and third aprty (developer) o No contract between plaintiff and def o Already suit bet plaintiff and third party to be referred to arbitration o Hence third party felt tt suit bet plaintiff and def shld be stayed and also referred to arbitration though no arbitrarion bet them as no conract between them o Application was dismissed by assistant registrar and matter appealed o Justice Lai Siu Chui – took view tt s6.5 of AA empowered court to order plaintiff to arbitrate its dispute with def though no arbitrarion agreement bet them – because provn states tt ref to party includes ref to any person claiming through o runder such a party  Also pted out tt order to stay proceedings merely meant tt there was more suitable forum for three parties involved to have all their disputes relating to one poject determined o : - decision cld have interesting conseq –may start trend where consultants eg architects, engineers, or quantity surveyors who may have arbitrarion clause in their respective service contracts with developer wld be drawn into tripartite arbitrations with developer and contractor o may also start trend of tripartite arbitrations involving developer, contractor and sub contractor

Lian Teck Construction V Woh Hup Pte Ltd 2006 4 Slr 1 Facts The defendants/respondents were the main contractors on a building project (“the project”). The plaintiff/appellant was appointed as a subcontractor on the project by the respondents pursuant to a subcontract between the parties (“the subcontract”).

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When the respondents gave notice to the appellant of partial termination of the subcontract, the appellant took this to be a repudiation of the subcontract and accepted such repudiation without prejudice to its right to recover damages against the defendants. Subsequently, the appellant commenced an action against the respondent for such damages. The respondents entered an appearance and applied for the proceedings in the action to be stayed in favour of arbitration pursuant to s 6 of the Arbitration Act (Cap 10, 2002 Rev Ed) (“the stay application”). In response, the appellant filed a crossapplication for interim payment, pursuant to O 29 r 10 of the Rules of Court (Cap 322, R 5, 2006 Rev Ed) (“the interim payment application”). A procedural issue of whether the stay application and the interim payment application ought to be heard together arose. The assistant registrar ordered, inter alia, that the hearing of the application for interim payment be adjourned to a date after the final resolution of the stay application. The appellant appealed against the assistant registrar’s orders, its contention being that both applications should be heard together. Held, dismissing the appeal: As regards to the argument that to delay the hearing of the application for interim payment until after the stay application had been finally disposed of would cause hardship to the deserving appellant, it should be noted that adjudication under s 12(1) Building and Construction Industry Security of Payment Act (Cap 30B, 2006 Rev Ed) provided an alternative means towards mitigating such hardship unless the contract was entered into on or after 1 April 2005. Moreover, it was open to the appellant to seek an interim award from the arbitrator if the matter went to arbitration: at [21]. o 21 I further looked at the matter from the stand point of fairness. (However, I should reiterate that in the appeal before me, I was not called upon to consider the merits of either the stay application or that for interim payment. The appeal concerned only the procedural issue whether the two applications ought to be heard together.) It was argued that to delay the hearing of an application for interim payment until after the stay application had been finally disposed of would cause hardship to a deserving plaintiff. As a partial answer to that, it should be noted that adjudication under s 12(1) of the Building and Construction Industry Security of Payment Act (Cap 30B, 2006 Rev Ed) as an alternative means of obtaining interim payment is available unless the contract was entered into on or after 1 April 2005. Besides, although the point was not argued by counsel, I believe it is open to the claimant to seek an interim award from the arbitrator if the matter went to arbitration. Therefore the hardship to a claimant may perhaps not be quite as severe as might be imagined.

Multiplex Construction V Singtel Enterprise 2005 2 Slr 530 – X Look Into Nature And Siptue To Let Stay -

Facts o Subsequently, Sintal sued Multiplex for various sums of money and damages that it claimed were due to it. Multiplex applied to stay the proceedings

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pursuant to an arbitration clause in the sub-contracts. An assistant registrar granted the stay, save for Sintal’s claim under the interim certificates (“the claim”). The judge in chambers upheld the assistant registrar’s decision. o On appeal, Multiplex argued that there were disputes under the claim which should be stayed in favour of arbitration. First, it was unclear from the SubContract whether Multiplex’s sole remedy for delay was liquidated damages. Multiplex argued that although cl 10 of the letter of acceptance stipulated liquidated damages for late completion, it still had a right to general damages under Item I in Bill 1 of the GCP and cl 11.4 of the Conditions. Held: o (3) The set-off notices that Multiplex sent Sintal were detailed documents that were reasonably accurate as they provided sufficient information to enable Sintal to ascertain the quantum of the set-off, to understand the bases of Multiplex’s claims against it and how the same were calculated, and to challenge such claims in any arbitration proceeding. However, in view of the phraseology of cl 11.4 and the common law position which did not allow the set-off of prospective debts, the first set-off notice was not reasonably accurate: at [33] and [34]. o (4) Multiplex was entitled to make a claim for every component of its monthly costs as long as it could prove that those costs would not have been incurred but for Sintal’s delay. Disputes as to the ability of Multiplex to recover any particular item and the extent to which such item was recoverable were matters to be sorted out by the arbitrator: at [35]. o (5) Multiplex had dropped its claim against LKC for delay. Even if the issue of concurrent delay remained, it could not be said to be indisputable that the set-off notices were not reasonably accurate because there was a substantive dispute on concurrent delay: at [36]. o (6) Apart from the first set-off notice in respect of interim certificate no 27, the other set-off notices complied with cl 11.5(i). A stay was granted in respect of the interim certificates save for interim certificate no 27. Multiplex was awarded two thirds of its costs here and b The legal position 4 The issues that arise on this appeal are substantially the same as those considered below. The main point that has to be determined by this court is whether there is a dispute between the parties that should be stayed in favour of arbitration. 5 The application made by Multiplex to stay the High Court action was brought under s 6 of the Arbitration Act (Cap 10, 2002 Rev Ed) (“the Act”). This section provides that a court may stay proceedings brought contrary to an arbitration agreement, if the court is satisfied that “there is no sufficient reason why the matter should not be referred in accordance with the arbitration agreement” (see s 6(2)(a)). It is well established that if the court finds that there is no dispute between the parties, then generally there will be no sufficient reason to stay court proceedings as there will be nothing to refer to arbitration. 6 The parties are in substantial agreement on the legal principles that guide the court when it hears an application under s 6 of the Act. Both parties cited the decision in Kwan Im Tong Chinese Temple v Fong Choon Hung Construction Pte Ltd [1998] 2

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SLR 137 (“the Kwan Im Tong case”). There, while this court accepted the principle enunciated in Tradax Internacional SA v Cerrahogullari TAS (The M Eregli) [1981] 2 Lloyd’s Rep 169 that if the claim is indisputable then the court has jurisdiction to hear the matter instead of referring it to arbitration, it also sanctioned a holistic and common-sense approach towards determining the existence of a dispute. In so doing, this court adopted the following observation of G P Selvam JC (as he then was) in Uni-Navigation Pte Ltd v Wei Loong Shipping Pte Ltd [1993] 1 SLR 876 at 879, [16] and [17]: The common form arbitration agreement provides for disputes to be decided by arbitrators. In such a case the court should, save in obvious cases, adopt a holistic and commonsense approach to see if there is a dispute. The justification for this approach is that it is important to hold a party to his agreement and avoid double and split hearing of matters. … If the defendant, therefore, makes out a prima facie case of disputes the courts should not embark on an examination of the validity of the dispute as though it were an application for summary judgment. This court in the Kwan Im Tong case (per Karthigesu JA at [10]) also indicated that while O 14 summary judgment principles aided the court in determining whether a claim should be immediately allowed in very obvious cases, it was not entirely safe to apply them in determining whether the parties should be bound by their agreement to arbitrate. His Honour agreed with the observation of Parker LJ in Home and Overseas Insurance Co Ltd v Mentor Insurance Co (UK) Ltd [1990] 1 WLR 153 at 158 that, except in a very clear case, in a situation where there was an arbitration clause, full-scale argument should not be permitted since the parties had agreed on their chosen tribunal and the defendant would be entitled, prima facie, to have the dispute decided by that tribunal in the first instance. This court concluded, on the basis of the authorities it had discussed, that it was the party resisting the stay of proceedings who had the burden of showing that the other party had no defence to the claim.

Dalian Hualiang Enterprise Group Co Ltd and Another v Louis Dreyfus Asia Pte Ltd [2005] 4 SLR 646– shld not go into details and nature od diptue, court shld not examine validity of dispute as though stay alication was an application for SJ - Facts - The first plaintiff (“DHE”) entered into a contract with the defendant (“LD”) (“the Armonikos contract”). DHE then assigned the Armonikos contract to the second plaintiff (“DJOM”). Subsequently, DJOM made two claims under the Armonikos contract. Sally Yang (“SY”) of LD’s offices in China confirmed certain sums to be payable on these claims and the plaintiffs filed an action against LD for these sums. LD applied for a stay of the action pursuant to an arbitration agreement in the Armonikos contract. - The issues before the assistant registrar (“AR”) who heard the stay application were, inter alia: (a) whether there was a dispute between the parties capable of arbitration under s 6(1) of the International Arbitration Act (Cap 143A, 2002 Rev Ed) (“IAA”); (b) whether there was an admission by LD of the debt; and (c) whether LD could claim a set-off from a running account, assuming there was such an admission (“the

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set-off issue”). LD raised the set-off issue as it had a claim against another company (“Fuhong”) under a different contract (“the Hanjin Tacoma contract”). LD alleged that Fuhong was treated as part of the group of companies that included DHE and DJOM insofar as the running account was concerned. The AR ordered a stay of the action. He held that there was a dispute regarding SY’s authority to bind LD as she was not an employee of LD itself. As such, the dispute was not capable of resolution by the court. The plaintiffs appealed against his decision. The parties presented further arguments on s 6(2) IAA as to whether the court had jurisdiction to consider if there was in fact a dispute between the parties or whether the court was obliged to refer any dispute to arbitration so long as there was a dispute. Held, allowing the appeal: Section 6(1) IAA applied where the proceedings in court were “in respect of any matter which [was] the subject of the [arbitration] agreement”. This meant that the court had no jurisdiction under s 6(2) IAA to order a stay if the court proceedings were not in respect of a matter which was the subject of the arbitration agreement. It should be for the court to determine if the matter before the court was the subject of the arbitration agreement. However, if that issue was arguable in that the outcome was not clear, then the court should stay the proceedings: at [20] and [25]. On the facts, SY was not the only one who had admitted the claims under the Armonikos contract. The sums payable on the claims were disclosed in a statement of account issued by LD, which demonstrated LD’s acceptance that the sums claimed under the Armonikos contract would be due and payable but for its claim under the Hanjin Tacoma contract: at [14]. The disputes under the Hanjin Tacoma contract were separate and distinct from those under the Armonikos contract. Neither of the plaintiffs was a party to the Hanjin Tacoma contract and the allegation about the running account arose only because of LD’s claim under that contract. The issue as to whether there was a running account was unrelated to the transaction under the Armonikos contract and it was clear that the set-off issue was not the subject of the arbitration agreement: at [30]. Under s 6(2) of the Arbitration Act (Cap 10, 2002 Rev Ed), the court might determine if there was in fact a dispute before deciding to order a stay, although the court should not examine the validity of the dispute as though the stay application was an application for summary judgment. As regards s 6(2) IAA, once there was a dispute, a stay had to be ordered unless the arbitration agreement was null and void, inoperative or incapable of being performed. The court was not to consider if there was in fact a dispute or whether there was a genuine dispute. The more difficult question was when it could be said that a dispute existed. A mere refusal to pay or silence was not a dispute. An admission by a defendant would, generally speaking, be contrary to a dispute but not every admission would necessarily avoid a stay order: at [74] and [75].

SIR newsletter dec 2005/jan 2006 pg 9 Commencement of arbitration proceedings

Section 9 of the Act Commencement of arbitration proceedings 9. Unless otherwise agreed by the parties, the arbitration proceedings in respect of a particular dispute shall commence on the date on which a request for that dispute to be referred to arbitration is received by the respondent. 

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Thus, the sending of the request is not enough. It has to be received by the respondent. S 9 of new Act states that, unless otherwise agreed, arbitration commences when the request is received by the Respondent. Cos there are cases where request may not be received. And then turns on the meaning of ‘received’  sometimes fella in Cayman Islands and other places where difficult to serve stuff on person. This imposes on the party commencing proceedings the added duty to show that the respondent has received the request. Provision is non-mandatory: parties may agree otherwise. Adopts Art 21 Model Law

Section 10 of the Act Powers of Court to extend time for beginning of arbitration proceedings 10. —(1) Where the terms of an arbitration agreement to refer future disputes to arbitration provide that a claim to which the arbitration agreement applies shall be barred unless — (a) some step has been taken to begin other dispute resolution procedures which must be exhausted before arbitration proceedings can be begun; (b) notice to appoint an arbitrator is given; (c) an arbitrator is appointed; or (d) some other step is taken to commence arbitration proceedings, within a time fixed by the agreement and a dispute to which the agreement applies has arisen, the Court may, if it is of the opinion that in the circumstances of the case undue hardship would otherwise be caused, extend the time for such period and on such terms as the Court thinks fit. (2) An order of extension of time made by the Court under subsection (1) — (a) may be made only after any available arbitral process for obtaining an extension of time has been exhausted; (b) may be made notwithstanding that the time so fixed has expired; and (c) shall not affect the operation of section 9 or 11 or any other written law relating to the limitation of actions. 

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‘Court’ in the Arbitration Act refers to the High Court of Singapore. Under s 10, the HC has the discretion to extend time for the beginning of arbitration proceedings if: The court is satisfied that ‘undue hardship’ would be caused without an EOT s 10, and The applicant has exhausted any available arbitral process for obtaining an EOT: s 10(2)(a). Then the court is entitled to fix new period for arbitration as deems fit: s 10

Four pre-arbitration dispute resolution procedures are specifically mentioned as the events for which EOT may be granted so that the disputes would not be barred for failure to take the steps within a time fixed by the agreement: see s 10(1)(a)-(d). And the order of EOT may be made notwithstanding that the time so fixed for commencing such procedures under the agreement has expired: s 10(2)(b).

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Under Section 11 of the new Arbitration Act, the Limitation Act shall apply to arbitration proceedings as it applies to proceedings before any court. Application of Limitation Act 11. —(1) The Limitation Act (Cap. 163) shall apply to arbitration proceedings as it applies to proceedings before any court and a reference in that Act to the commencement of any action shall be construed as a reference to the commencement of arbitration proceedings. (2) The Court may order that in computing the time prescribed by the Limitation Act for the commencement of proceedings (including arbitration proceedings) in respect of a dispute which was the subject-matter of — (a) an award which the Court orders to be set aside or declares to be of no effect; or (b) the affected part of an award which the Court orders to be set aside in part or declares to be in part of no effect, the period between the commencement of the arbitration and the date of the order referred to in paragraph (a) or (b) shall be excluded. (3) Notwithstanding any term in an arbitration agreement to the effect that no cause of action shall accrue in respect of any matter required by the agreement to be referred until an award is made under the agreement, the cause of action shall, for the purpose of the Limitation Act, be deemed to have accrued in respect of any such matter at the time when it would have accrued but for that term in the agreement. 

Jurisdiction of Arbitral Tribunal 

Based on Article 16 of the Model Law, the doctrine of competence now applies to arbitral tribunals. Under Section 21, they may rule on their own jurisdiction and also on the existence or validity of the arbitration agreement. Note that an “arbitration clause” in an Agreement may be regarded as an independent agreement by virtue of Section 4(2) Arbitration Act.

Separability of arbitration clause and competence of arbitral tribunal to rule on its own jurisdiction 21. —(1) The arbitral tribunal may rule on its own jurisdiction, including any objections to the existence or validity of the arbitration agreement. (2) For the purpose of subsection (1), an arbitration clause which forms part of a contract shall be treated as an agreement independent of the other terms of the contract. (3) A decision by the arbitral tribunal that the contract is null and void shall not entail ipso jure (as a matter of law) the invalidity of the arbitration clause. (4) A plea that the arbitral tribunal does not have jurisdiction shall be raised not later than the submission of the statement of defence.

(5) A party shall not be precluded from raising the plea that the arbitral tribunal does not have jurisdiction by the fact that he has appointed, or participated in the appointment of, an arbitrator. (6) A plea that the arbitral tribunal is exceeding the scope of its authority shall be raised as soon as the matter alleged to be beyond the scope of its authority is raised during the arbitration proceedings. (7) Notwithstanding any delay in raising a plea referred to in subsection (4) or (6), the arbitral tribunal may admit such plea if it considers the delay to be justified in the circumstances. (8) The arbitral tribunal may rule on a plea referred to in this section either as a preliminary question or in an award on the merits. (9) If the arbitral tribunal rules on a plea as a preliminary question that it has jurisdiction, any party may, within 30 days after having received notice of that ruling, apply to the Court to decide the matter. (10) The leave of the Court is required for any appeal from a decision of the Court under this section. (11) While an application under subsection (9) is pending, the arbitral tribunal may continue the arbitration proceedings and make an award. 

The concept of separability is now embodied in Section 21(3) of the new Act. Thus, a decision by the tribunal that the contract is null and void does not entail ipso jure (as a matter of law) the invalidity of the arbitration clause.

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The plea of lack of jurisdiction is to be raised not later than the submission of the statement of defence.

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Where there is a plea that the arbitral tribunal has exceeded its authority, it must be raised when the matter concerned is raised during the arbitration proceedings.

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Where the tribunal holds that it has jurisdiction, one can apply to the High Court to decide the matter. For any further appeal, the leave of the High Court would be required. It would, however, appear that where the tribunal holds that it has no jurisdiction, there is no appeal to the Court.

Prehearing dealings with arbitrators 

After the appointment of the arbitrator (and his acceptance), he would normally ask the parties to appear before him. The Arbitrator will then give directions as to the filing of pleadings, the Statement of Claim and the Statement of Defence, and the dates they are to be filed. Section 24 of the new Act no longer refers to a “Reply”, though this would be necessary where there is a counter claim. Nevertheless lawyers do usually file a reply in such an instance where it is necessary.

Statements of claim and defence 24. —(1) Within the period of time agreed by the parties or, failing such agreement, as determined by the arbitral tribunal, the claimant shall state —

(a) the facts supporting his claim; (b) the points at issue; and (c) the relief or remedy sought, and the respondent shall state his defence in respect of the particulars set out in this subsection, unless the parties have otherwise agreed to the required elements of such statements. (2) The parties may submit to the arbitral tribunal with their statements, all documents they consider to be relevant or other documents which refer to such documents, or other evidence. (3) Except as otherwise agreed by the parties, either party may amend or supplement his claim or defence during the course of the arbitration proceedings, unless the arbitral tribunal considers it inappropriate to allow such amendment, having regard to the delay in making the amendment. 

After the close of proceedings, the Claimant and the Respondent would then have to deliver a list of documents. Thereafter the Claimant’s Solicitor would prepare an (“Agreed Bundle”). As for documents not agreed, the parties can prepare their own bundles.

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The Arbitrator would also like to be told whether there would be expert witnesses and if so, their reports should be exchanged. Sometimes, the Arbitrator may want to limit the number of expert witnesses to be called by each side.

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Section 27 of the new Arbitration Act gives the power to the arbitral tribunal to appoint experts. If the tribunal would like to do so it would have to search an appoint such an expert and give him/her time to make his/her assessment and to formulate a written or oral report prior to the hearing.

Power to appoint experts 27. —(1) Unless otherwise agreed by the parties, the arbitral tribunal may — (a) appoint one or more experts to report to it on specific issues to be determined by the tribunal; and (b) require a party to give the expert any relevant information or to produce, or to provide access to, any relevant documents, goods or other property for his inspection. (2) Unless otherwise agreed by the parties, if a party so requests or if the arbitral tribunal considers it necessary, the expert shall, after delivery of his written or oral report, participate in a hearing where the parties have the opportunity to put questions to him and to present other expert witnesses in order to testify on the points at issue. 

The “venue” or the premises where the arbitration would be held would be discussed (usually a conference room, sometimes in some posh town club). The use of shorthand notes or other means of recording/ transcribing will then be determined.

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Similar to the procedure now adopted in the Courts, some arbitrators may direct that the affidavits be filed by the parties within a specified time, and thus reduce the time spent in examination in chief.

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If you’re an arbitrator, when dealing with lawyers, always appear to be fair and impartial. Don’t interfere too much or it could be grounds for improper conduct. Don’t talk too much in front of the parties or their lawyers.

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Arbitrators must be careful in dealing with requests or communications made by lawyers for the parties to the arbitration. While some of them may be innocuous (e.g. extension of time for filing pleadings) and may be decided by the arbitrator in his discretion, it would always be wise to obtain the views of the other party before making a decision. It must be noted that the provisions of the Evidence Act do not apply to arbitrations under Section 2(1) of the Evidence Act.

Section 2(1) Evidence Act 2. —(1) Parts I, II and III shall apply to all judicial proceedings in or before any court, but not to affidavits presented to any court or officer nor to proceedings before an arbitrator. Arbitral Proceedings 

Based on Article 18 of the Model Law, Section 22 of the new Arbitration Act makes it a mandatory duty for the arbitral tribunal to act fairly and impartially.

General duties of arbitral tribunal 22. The arbitral tribunal shall act fairly and impartially and shall give each party a reasonable opportunity of presenting his case. 

Based on Article 19 of the Model Law, Section 23 of the new Act gives the parties freedom to agree on the procedure to be followed by the arbitral agreement. o Following art 19 Model Law, the new s 23(1) gives the parties the freedom to agree on the procedure to be followed, failing which the tribunal will conduct the proceedings as its sees appropriate: s 23(2).

Determination of rules of procedure 23. —(1) Subject to the provisions of this Act, the parties are free to agree on the procedure to be followed by the arbitral tribunal in conducting the proceedings. (2) Failing such agreement, the arbitral tribunal may, subject to the provisions of this Act, conduct the arbitration in such manner as it considers appropriate. (3) The power conferred on the arbitral tribunal under subsection (2) includes the power to determine the admissibility, relevance, materiality and weight of any evidence.  

The language used inay Section 23 does not imply any need for any adherence to the rules laid down in the Evidence Act.

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The duties of the Tribunal are not delegable. In Neale v Richardson [1938] 1 AER 753, Arbitrator named nominated person to hear evidence and act as the arbitrator. It was held to be improper. Cannot consult anyone to decide the dispute.

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Certain functions are delegable. - Analysing samples. - Stock taking/inventory. - Measuring of land/valuation. - Taking accounts. (NOTE however where an arbitrator gave claims on accounts to a firm of accountants who gave report. Award made adopting report of the accountants. It was held to be excessive delegation. See The Eastern Counties Railway Co v Eastern Union Railway Co (1863) 3 De GJ & S 610

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Section 24 of the new Act now refers to “Statement of Claim and Defence”, No “Reply” is referred to, but obviously the tribunal can allow filing of other documents.

Statements of claim and defence 24. —(1) Within the period of time agreed by the parties or, failing such agreement, as determined by the arbitral tribunal, the claimant shall state — (a) the facts supporting his claim; (b) the points at issue; and (c) the relief or remedy sought, and the respondent shall state his defence in respect of the particulars set out in this subsection, unless the parties have otherwise agreed to the required elements of such statements. (2) The parties may submit to the arbitral tribunal with their statements, all documents they consider to be relevant or other documents, which refer to such documents, or other evidence. (3) Except as otherwise agreed by the parties, either party may amend or supplement his claim or defence during the course of the arbitration proceedings, unless the arbitral tribunal considers it inappropriate to allow such amendment, having regard to the delay in making the amendment. Under Section 25 of the new Act, the arbitral tribunal can decide how proceedings are to be conducted. Thus, an arbitration may proceed with or without oral hearing or oral arguments. It can proceed on the basis of documents (e.g. written affidavits) and materials. This is subject to any contrary agreement.  Therefore if parties request for oral hearing, arbitral tribunal must allow an oral hearing - Myint Soe: Being a lawyer, the arbitrator would usually follow court procedure - Start with oaths/affirmation - Then, written submissions, - EIC, XXN, Re-Exam 

And then an award in lieu of a judgement – which of course is liable to appeal [see below].

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Hearings and written proceedings 25. —(1) Subject to any contrary agreement by the parties, the arbitral tribunal shall determine if proceedings are to be conducted by oral hearing for the presentation of evidence or oral argument or on the basis of documents and other materials. (2) Unless the parties have agreed that no hearings shall be held, the arbitral tribunal shall, upon the request of a party, hold such hearings at an appropriate stage of the proceedings. (3) The parties shall be given sufficient notice in advance of any hearing and of any meeting of the arbitral tribunal for the purposes of inspection of goods, other property or documents. (4) All statements, documents or other information supplied to the arbitral tribunal by one party shall be communicated to the other party. (5) Any expert report or evidentiary document on which the arbitral tribunal may rely in making its decision shall be communicated to the parties. 

But even where affidavits have been filed, the arbitrators would usually allow more evidence to be entered orally – to ensure that justice is done, since the lawyer may not have known certain facts when the affidavit was first prepared. The lawyer must apply for the oral evidence to be admitted.

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It is implied from the words “shall be communicated” in Section 25(5) that the parties should file the expert reports and evidentiary documents ahead. Hence the present practice of giving “directions” would normally include the time for filing of expert reports, and of discovery and inspection of documents.

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Under Section 26 of the new Act, the parties are free to agree on the agree on the consolidation of arbitration proceedings or for concurrent hearings where there is more than one arbitration proceedings. The tribunal would have such power if the parties agree to confer such power. No provisions are made for the Court to exercise such power.

Consolidation of proceedings and concurrent hearings 26. —(1) The parties may agree — (a) that the arbitration proceedings shall be consolidated with other arbitration proceedings; or (b) that concurrent hearings shall be held, on such terms as may be agreed. (2) Unless the parties agree to confer such power on the arbitral tribunal, the tribunal has no power to order consolidation of arbitration proceedings or concurrent hearings. Power to appoint experts 27. —(1) Unless otherwise agreed by the parties, the arbitral tribunal may —

(a) appoint one or more experts to report to it on specific issues to be determined by the tribunal; and (b) require a party to give the expert any relevant information or to produce, or to provide access to, any relevant documents, goods or other property for his inspection. (2) Unless otherwise agreed by the parties, if a party so requests or if the arbitral tribunal considers it necessary, the expert shall, after delivery of his written or oral report, participate in a hearing where the parties have the opportunity to put questions to him and to present other expert witnesses in order to testify on the points at issue. -

S27 AA is based on s 26 Model Law in giving the arbitral tribunal the power to appoint experts, a power that was not found in the previous Act. Note that S 37 Eng AA goes even further and refers to Legal Advisors and Assessors. In most arbitrations, there will be experts especially in fields of construction, insurance etc. Arbitrator must be careful here because expert reports are impt and shld be exchanged by both parties and shld be given to the arbitrator before the arbitration starts Problem when arbitrator thinks he is an expert – and if disagrees then should trash it out with the experts when issue arises – do not just say tt disagree in the judgement. Cannot use their own expert knowledge without first putting it to the experts. And how to decide which expert to believe? Where confused, arbitrator is allowed to appoint his own expert: this is something new. And if not a lawyer, then permitted to consult a lawyer as well Expert can also be asked by any party to participate in the hearing: s 27(2) – and on costs probably the losing party will pay.

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Other Powers of the Arbitral Tribunal Section 28 of the new Act refers to general powers exercisable by the tribunal. However, it is not confined to making orders or giving directions for security for costs, or for the preservation and interim custody of any evidence. It is to be noted that security for costs can be ordered against any party.  Orders for preservation and interim custody would be similar to grant of an interim injunction by the Court. This new section enumerates other matters such as discovery of documents and interrogatories, giving of evidence by affidavit, the examination of parties by oath or affirmation and administering the same. 

General powers exercisable by arbitral tribunal 28. —(1) The parties may agree on the powers, which may be exercised by the arbitral tribunal for the purposes of and in relation to the arbitration proceedings. (2) Without prejudice to the powers conferred on the arbitral tribunal by the parties under subsection (1), the tribunal shall have powers to make orders or give directions to any party for —

(a) security for costs; (b) discovery of documents and interrogatories; (c) giving of evidence by affidavit; (d) a party or witness to be examined on oath or affirmation, and may for that purpose administer any necessary oath or take any necessary affirmation; (e) the preservation and interim custody of any evidence for the purposes of the proceedings; (f) samples to be taken from, or any observation to be made of or experiment conducted upon, any property which is or forms part of the subject-matter of the dispute; and (g) the preservation, interim custody or sale of any property which is or forms part of the subject-matter of the dispute. (3) The power of the arbitral tribunal to order a claimant to provide security for costs as referred to in subsection (2)(a) shall not be exercised by reason only that the claimant is — (a) an individual ordinarily resident outside Singapore; or (b) a corporation or an association incorporated or formed under the law of a country outside Singapore, or whose central management and control is exercised outside Singapore. (4) All orders or directions made or given by an arbitral tribunal in the course of an arbitration shall, by leave of the Court, be enforceable in the same manner as if they were orders made by the Court and, where leave is so given, judgment may be entered in terms of the order or direction. 

Muslims affirm and Christians swear oaths on the Bible.

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Section 29 of the new Act deals with defaulting parties. Where statements of claims are not filed in time, the proceedings may be summoned. However, if the defence is not filed the tribunal can proceed, but it is not to treat such failure in itself as an admission of the claimant’s allegations. Where the claimant is guilty of inordinate or inexcusable delay, the tribunal may make an award dismissing the claim.

Powers of arbitral tribunal in case of party’s default 29. —(1) The parties may agree on the powers which may be exercised by the arbitral tribunal in the case of a party’s failure to take any necessary action for the proper and expeditious conduct of the proceedings. (2) Unless otherwise agreed by the parties, if, without showing sufficient cause — (a) the claimant fails to communicate his statement of claim in accordance with section 24, the arbitral tribunal may terminate the proceedings; (b) the respondent fails to communicate his statement of defence in accordance with section 24, the arbitral tribunal may continue the proceedings without treating such failure in itself as an admission of the claimant’s allegations; and

(c) any party fails to appear at a hearing or to produce documentary evidence, the arbitral tribunal may continue the proceedings and make the award on the evidence before it. (3) If the arbitral tribunal is satisfied that there has been inordinate and inexcusable delay on the part of the claimant in pursuing his claim, and the delay — (a) gives rise, or is likely to give rise, to a substantial risk that it is not possible to have a fair resolution of the issues in that claim; or (b) has caused, or is likely to cause, serious prejudice to the respondent, the tribunal may make an award dismissing the claim. 

Section 30 of the new Act gives power to the parties to secure the attendance of witnesses. A court order can be obtained to subpoena witnesses.

Witnesses may be summoned by subpoena 30. —(1) Any party to an arbitration agreement may take out a writ of subpoena ad testificandum (writ to compel witness to attend and give evidence) or a writ of subpoena duces tecum (writ to compel witness to attend and give evidence and produce specified documents). (2) The Court may order that a writ of subpoena ad testificandum or a writ of subpoena duces tecum shall be issued to compel the attendance before an arbitral tribunal of a witness wherever he may be within Singapore. (3) The Court may also issue an order under section 38 of the Prisons Act (Cap. 247) to bring up a prisoner for examination before an arbitral tribunal. (4) No person shall be compelled under any such writ to produce any document which he could not be compelled to produce on the trial of an action. 

Section 31 of the new Act refers to Court’s powers exercisable in support of arbitration proceedings. - S 31 of the new Act generally states that the court has the same power as that conferred on an arbitral tribunal under s 28, in addition to pre-emptive powers like - Securing the amount of the dispute, - Ensuring that any award will not be ineffectual by dissipation of the assets, and - Order interim injunction or other interim measure.

Court’s powers exercisable in support of arbitration proceedings 31. —(1) The Court shall have the following powers for the purpose of and in relation to an arbitration to which this Act applies: (a) the same power to make orders in respect of any of the matters set out in section 28 as it has for the purpose of and in relation to an action or matter in the Court; (b) securing the amount in dispute; (c) ensuring that any award which may be made in the arbitral proceedings is not rendered ineffectual by the dissipation of assets by a party; and (d) an interim injunction or any other interim measure.

(2) An order of the Court under this section shall cease to have effect in whole or in part if the arbitral tribunal or any such arbitral or other institution or person having power to act in relation to the subject-matter of the order makes an order to which the order of the Court relates. (3) The Court, in exercising any power under this section, shall have regard to — (a) any application made before the arbitral tribunal; or (b) any order made by the arbitral tribunal, in respect of the same issue. (4) Provision may be made by Rules of Court for conferring on the Registrar of the Supreme Court (within the meaning of the Supreme Court of Judicature Act (Cap. 322)) or other officer of the Court all or any of the jurisdiction conferred by this Act on the Court. 

It is however pertinent to note that the Court must give due regard to what the arbitral tribunal does. Where similar orders are later made by the tribunal, the order of the court would cease to have effect.

Removal of arbitrators  2 sitns when this is sought – - want to remove arbitrator - award already made, want to set aside award on misconduct (note term is not used any longer) 

The Court may be requested to remove an arbitrator on the grounds referred to in Section 16(1) of the new Act. Other institns or persons so empowered may also remove. Court not to act until tt is done.

Failure or impossibility to act 16. —(1) A party may request the Court to remove an arbitrator — (a) who is physically or mentally incapable of conducting the proceedings or where there are justifiable doubts as to his capacity to do so; or (b) who has refused or failed — (i) to properly conduct the proceedings; or (ii) to use all reasonable despatch in conducting the proceedings or making an award, and where substantial injustice has been or will be caused to that party. (2) If there is an arbitral or other institution or person vested by the parties with power to remove an arbitrator, the Court shall not exercise its power of removal unless it is satisfied that the applicant has first exhausted any available recourse to that institution or person. (3) While an application to the Court under this section is pending, the arbitral tribunal, including the arbitrator concerned may continue the arbitration proceedings and make an award. (4) Where the Court removes an arbitrator, the Court may make such order as it thinks fit with respect to his entitlement, if any, to fees or expenses, or the repayment of any fees or expenses already paid.

(5) The arbitrator concerned is entitled to appear and be heard by the Court before it makes any order under this section. (6) No appeal shall lie against the decision of the Court made under subsection (4). note that the wording of Section 16 of the new Act does not use the word “misconduct” unlike Section 17 and 18 of the previous Arbitration Act. The phrase used is “refused or failed to properly conduct the proceedings”.  Although the legal effect is roughly the same, the new phrasing avoids the undesirable stigma on the arbitrator. The cases above refer to the old test of “misconduct”. In the part, there were two kinds of misconduct – legal misconduct and personal misconduct. 

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Principles of natural justice apply

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Recent case under new Act wrt removal of arbitrator is tt of yee hong v powen electrical engineering 2005 3 SLR 512 - In tt case yee hong filed application under s16(1)(b) of AA to remove arbitrator in arbitration proceedings commenced by powen electrical - Allgted tt arbitrator in tt case had made preemptory order tt unless yee hong exchanged affidavits of eic before certain date, he wld proceed to hear matter with regard to AEIC fr yee hong - Additionally alleged tt arbitrator made said order without hearing application for yee hong for fuhter discovery of docs and consequential application for etensoin of time to exchange affidavits - Therefore alleged tt this amted to violation of natural justice and breach of duty under s22 - Belinda Ang J dismissed application; pted out tt power to remove arbitrator wld not be exercised unless failure to conduct proceedings properly had cuased or wld cause substantial injustice to applicant - Whilst failure to comply with s22 of act might manifest improper conduct of proceedings, tt in itself not enough to warrant removal of arbitrator under s16.1.b - Latter provision reqd second stage of investigation nad tt whether failure had cuased or wld cause substantial injustice - Test of substantial injustice was igh one for any application to surmount and diff fr test under prev regime - Judge also found tt arbitrator had heard arg fr both sides before making order - Thus arbitrator had balanced relevant considerations and entitled to ocnlue tt no basis for not proceeding to hold hearing of scheduled dates - Arbitrator had wide discretion in reaching his decisions as to what duty of acting fialry demanded in circumstances of partr case

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An arbitrator is allowed to make mistakes of law, but if he continually makes mistakes of law as he does not care for the law, that may well be evidence of misconduct.

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In some cases improper admission of evidence or improper rejection of evidence may amount to misconduct. Even use of one’s own expert knowledge may amount to misconduct.

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In Fisher & Another v P G Wellfair Ltd [1981] 2 Lloyds Rep. 514 (English CA), the applicants served notices of motion in the main and individual arbitrations applying that the arbitrator be removed for misconduct; alternatively that the awards be set aside for misconduct. The grounds of the application were inter alia that (1) the arbitrator had taken into account facts and matters which tended to contradict the unchallenged evidence tendered at the hearing of the reference without giving the applicants notice or opportunity of dealing with the same and (2) he failed to conduct the said proceedings in accordance with the principles of natural justice. - Held, by C.A. (Lord DENNING, M.R., DUNN and O'CONNOR, L.JJ.), that (1) on the evidence the arbitrator was an expert and not simply a legal arbitrator - (2) the fact that the claim was undefended did not mean that the arbitrator was obliged to accept the claim without question nor did it mean that he was under an obligation to protect the party who was not present; his function was to hold the scales of justice as evenly as he could and act as fairly and judicially in the conduct of the hearing - (3) an expert arbitrator should not in effect give evidence to himself without disclosing the evidence on which he relied to the parties or if there was only one to that party; he should not act on his private opinion without disclosing it and although it was true that an expert arbitrator could use his own expert knowledge there was a distinction between general expert knowledge and knowledge of special facts relevant to the particular case - (4) the conclusion which the arbitrator had come to could only have been reached by in effect giving evidence to himself in fiat contradiction to the evidence given by the applicants' expert witnesses; natural justice required that he ought to have put his alternative scheme and alternative costings to the experts to give them an opportunity of dealing with them; and in failing to take that course the arbitrator was guilty of technical or legal misconduct in failing to observe the principles of natural justice - (5) in the circumstances the learned Judge was right in his conclusion that the awards would be set aside and the arbitrator removed and the appeal would be dismissed

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Turner (East Asia) Pte Ltd v Builders Federal (Hong Kong) Ltd & Anor (No. 2) [1988] 2 MLJ 502 is an interesting case where the “reasonable suspicion” test was applied (in relation to the old Section 17(1), the predecessor of the current Section 16(1) AA. The test applied by Chao Tick Hin J (as he then was) was whether a reasonable and fair minded person sitting in Court and knowing all the relevant facts have a reasonable suspicion that a fair hearing for the applicant was not possible. It was held that by not referring a legal question to the Court, the arbitrator had misconducted the proceedings.

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In Sabah Bank Bhd v Borneo Housing Mortgage Finance Bhd [1992] 3 CLJ 1640, it was remarked that it was not misconduct to err in fact or law, or to make findings for which there was no evidence. In that case, it was held that the arbitrator had not deviated from the norms as the parties had their say, they submitted all sorts of documents, they talked at length, and only at the end did the arbitrator consider the facts and the weight to be placed on each, as well, as the law. Accordingly, he had not misconducted himself or the proceedings.

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The recent case of Koh Bros Building and Civil Engineering Contractor Pte Ltd v Scotts Development (Saraca) Pte Ltd [2002] 4 SLR 748 relates to the alleged misconduct of an arbitrator during the course of an arbitration. That case involved a dispute between the contractor and the developer. The contractor had applied for an interim award on the sum obtained. The developer objected in correspondence to the application that the matter was res judicata. At the hearing of the preliminary objections of the developer, an additional argument was presented; namely that the matter was not fit for summary disposal. The arbitrator apparently agreed with the submission and later wrote to the parties refusing to hear the application for the interim award. - The arbitrator then applied to the High Court for the removal of the arbitrator for misconduct under Section 17(1)(a) of the previous Arbitration Act alleging breach of natural justice as he had not heard their application on the merits. Additionally, it was argued that he had prejudged the matter, as the only matter before him was whether the contractor’s application should be heard. - Judith Prakash J went extensively into the general law relating to misconduct, and dealt with the two main issues before her: - (a) was there a breach of natural justice as alleged; and - (b) should the arbitrator be removed. - The learned judge took the view that there was a breach of natural justice as submitted by the contractor, and hence the arbitrator had acted inappropriately. With regards to the next question, it was pointed out that an order for removal would be made if it is determined that the conduct of the arbitrator was such as to make a reasonable person think that there was a real likelihood that the arbitrator could not or would not fairly determine the relevant issues in the arbitration. In the circumstances, the arbitrator would be removed. - The learned Judge pointed out that the arbitrator had cut short the process of listening to both sides, by telescoping two separate parts of the interim application hearing into one. He did so by determining the outcome of the first part of the application on the basis of issues that actually fell within the second part of the application, without hearing full arguments from both sides.

Award

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Section 32 of the new Act deals with the law to be applied by an arbitral tribunal to the substance of a dispute before it.

Law applicable to substance of dispute 32. —(1) The arbitral tribunal shall decide the dispute in accordance with the law chosen by the parties as applicable to the substance of the dispute. (2) If or to the extent that the parties have not chosen the law applicable to the substance of their dispute, the arbitral tribunal shall apply the law determined by the conflict of laws rules. (3) The arbitral tribunal may decide the dispute, if the parties so agree, in accordance with such other considerations as are agreed by them or determined by the tribunal. 

Section 32(2) therefore presumes that the law of Singapore need not apply in such cases. This could be so in cases where the parties arbitrating in Singapore may not have any connection with Singapore, but merely like to come to Singapore to arbitrate.

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Section 32(3) would allow the tribunal to decide according to justice, equity and good conscience and other similar considerations. Thus a decision would be recognised, even if it is not made in accordance with any system of national law.

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Section 33 allows an arbitral tribunal to make more than one award at different points in time. The controversial concept of ‘interim awards’ has also been dropped in the new Act. A tribunal may decide on liability which would affect the whole claim, or the tribunal may decide in part only of the claim or on cross-claims submitted for decision, or on counterclaims.

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Law Commission’s Final Report on The Review of Arbitration Laws: This clause was to cater for complex cases where issues raised may mean protracted and expensive hearings, and empowers the tribunal to identify and deal with issues it deems critical in priority over others. The omission of ‘interim awards’ was deliberate as the Act contemplates that all awards enforcement of which is sought (including interim and partial awards) are to be final in nature The reference to ‘different times’ is so as to avoid any controversy on whether an interim award has final and binding effect.

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Awards made on different issues 33. —(1) Unless otherwise agreed by the parties, the arbitral tribunal may make more than one award at different points in time during the proceedings on different aspects of the matters to be determined. (2) The arbitral tribunal may, in particular, make an award relating to — (a) an issue affecting the whole claim; or (b) a part only of the claim, counter-claim or cross-claim, which is submitted to the tribunal for decision.

(3) If the arbitral tribunal makes an award under this section, it shall specify in its award, the issue, or claim or part of a claim, which is the subject-matter of the award. -

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Section 34 of the new Act deals with remedies or reliefs, which an arbitral tribunal may award. Here again, the choice of the parties is paramount. that unless otherwise agreed, the tribunal shall have the power to make any award that could have been ordered by a Court in civil proceedings There is now no restriction in Singapore on the power to grant specific performance of a contract relating to land, unlike First Schedule of the old Act and s 48 Eng Act.

Thus our Tribunals may have more powers than the English Tribunals as our law also modelled on Model Law

Remedies 34. —(1) The parties may agree on the powers exercisable by the arbitral tribunal as regards remedies. (2) Unless otherwise agreed by the parties, the arbitral tribunal may award any remedy or relief that could have been ordered by the Court if the dispute had been the subject of civil proceedings in that Court. 

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If the parties had not agreed to limit the available remedies beforehand, Section 34(2) states that the tribunal can provide any relief or remedy as the High Court could if the dispute had been the subject of a civil dispute proceedings in court e.g. -

Award for payment of money Specific performance – including rights relating to land or interest in land. Declaratory relief – e.g. whether a party is entitled to reject goods; meaning of certain clauses in a lease. Must be a final declaration, which determine the rights of the parties “once and for all”. See Bocatra Construction Pte Ltd v A-G [1995] 2 SLR 523 Comments: Interim declarations could not exist in law as final legal rights were not being declared. It was not enough to maintain that simply because injunctions were not available in proceedings against the government, the courts should therefore freely adapt the device of a declaratory order to attain a desired result which might only be properly achieved through the grant of an injunction.

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Indemnity – against liability to third parties, which have yet to be established or incurred.

Section 35 deals with interest payable on an award. The general rule is that it should be the same as a judgment debt.

Interest 35. —(1) The arbitral tribunal may award interest, including interest on a compound basis, on the whole or any part of any sum that — (a) is awarded to any party; or (b) is in issue in the arbitral proceedings but is paid before the date of the award, for the whole or any part of the period up to the date of the award or payment, whichever is applicable. (2) A sum directed to be paid by an award shall, unless the award otherwise directs, carry interest as from the date of the award and at the same rate as a judgment debt. 

Section 36 allows the court to give extensions of time for making an award provided it is satisfied that substantial injustice would otherwise be done.

Extension of time for making award 36. —(1) Where the time for making an award is limited by the arbitration agreement, the Court may by order, unless otherwise agreed by the parties, extend that time. (2) An application for an order under this section may be made — (a) upon notice to the parties, by the arbitral tribunal; or (b) upon notice to the arbitral tribunal and the other parties, by any party to the proceedings. (3) An application under this section shall not be made unless all available tribunal processes for application of extension of time have been exhausted. (4) The Court shall not make an order under this section unless it is satisfied that substantial injustice would otherwise be done. (5) The Court may extend the time for such period and on such terms as it thinks fit, and may do so whether or not the time previously fixed by or under the arbitration agreement or by a previous order has expired. (6) The leave of the Court shall be required for any appeal from a decision of the Court under this section. -

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Section 37 allows the tribunal may record a settlement between parties in the form of an arbitral award on agreed terms. The parties may agree to come to a settlement and then may want to record the settlement in the form of a consent award so that they could have a settlement agreement with all the benefits of enforcement that comes along with an arbitral award: eg could enforce it in a jurisdiction that is party to the NY Convention. This saves the party in whose favour the award is made the need to prove its claims afresh or sue on the settlement agreement should default be made in the performance of the agreed terms Award by consent 37. —(1) If, during arbitration proceedings, the parties settle the dispute, the arbitral tribunal shall terminate the proceedings and, if requested by the parties and not objected to by the arbitral tribunal, record the settlement in the form of an arbitral award on agreed terms. (2) An arbitral award on agreed terms —

(a) shall be made in accordance with section 38; (b) shall state that it is an award; and (c) shall have the same status and effect as any other award on the merits of the case. (3) An award on agreed terms may, with the leave of the Court, be enforced in the same manner as a judgment or order to the same effect, and where leave is so given, judgment may be entered in terms of the award.  Form and Contents of Award Section 38 of the new Arbitration Act stipulates inter alia that the award shall be made in writing and signed by the arbitrator or arbitrators.  The award must be in writing, and signed by all the arbitrators or a majority provided the reason for any omitted signature is stated: s 38(1), with the date and place of arbitration stated: s 38(3)  The award must state the reasons on which it is based, UNLESS: - the parties have agreed that no grounds need be stated OR - the award is an award by consent under s 37. 

Form and contents of award 38. —(1) The award shall be made in writing and shall be signed — (a) in the case of a single arbitrator, by the arbitrator himself; or (b) in the case of 2 or more arbitrators, by all the arbitrators or the majority of the arbitrators provided that the reason for any omitted signature of any arbitrator is stated. (2) The award shall state the reasons upon which it is based, unless the parties have agreed that no grounds are to be stated or the award is an award on agreed terms under section 37. (3) The date of the award and place of arbitration shall be stated in the award. (4) The award shall be deemed to have been made at the place of arbitration. (5) After the award is made, a copy of the award signed by the arbitrators in accordance with subsection (1) shall be delivered to each party. 

An arbitration whose place of arbitration is Singapore shall be deemed to be made in Singapore. This implies that this presumption will be applied even if the hearing takes place outside Singapore, or the arbitrators put their signature on the award outside Singapore.

 Correction or interpretation of award and additional award Correction or interpretation of award and additional award 43. —(1) A party may, within 30 days of the receipt of the award, unless another period of time has been agreed upon by the parties — (a) upon notice to the other parties, request the arbitral tribunal to correct in the award any error in computation, any clerical or typographical error, or other error of similar nature; and

(b) upon notice to the other parties, request the arbitral tribunal to give an interpretation of a specific point or part of the award, if such request is also agreed to by the other parties. (2) If the arbitral tribunal considers the request in subsection (1) to be justified, the tribunal shall make such correction or give such interpretation within 30 days of the receipt of the request and such interpretation shall form part of the award. (3) The arbitral tribunal may correct any error of the type referred to in subsection (1)(a) or give an interpretation referred to in subsection (1)(b), on its own initiative, within 30 days of the date of the award. (4) Unless otherwise agreed by the parties, a party may, within 30 days of receipt of the award and upon notice to the other party, request the arbitral tribunal to make an additional award as to claims presented during the arbitration proceedings but omitted from the award. (5) If the arbitral tribunal considers the request in subsection (4) to be justified, the tribunal shall make the additional award within 60 days of the receipt of such request. (6) The arbitral tribunal may, if necessary, extend the period of time within which it shall make a correction, interpretation or an additional award under this section. (7) Section 38 shall apply to an award in respect of which a correction or interpretation has been made under this section and to an additional award.  Effect of award 

The doctrine of “finality” is enshrined in Section 44(1) of the new Act.

Effect of award 44. —(1) An award made by the arbitral tribunal pursuant to an arbitration agreement shall be final and binding on the parties and on any person claiming through or under them and may be relied upon by any of the parties by way of defence, set-off or otherwise in any proceedings in any court of competent jurisdiction. (2) Except as provided in section 43, upon an award being made, including an award made in accordance with section 33, the arbitral tribunal shall not vary, amend, correct, review, add to or revoke the award. (3) For the purposes of subsection (2), an award is made when it has been signed and delivered in accordance with section 38. (4) This section shall not affect the right of a person to challenge the award by any available arbitral process of appeal or review or in accordance with the provisions of this Act. Tang Boon Jek Jeffrey v Tan Poh Leng Stanley [2001] 3 SLR 237 The “final award” must be the one that completes everything that the arbitral tribunal is expected to decide, including the question of costs. Following from the above, it is clear that until such a final award is given, the arbitral tribunal’s mandate still continues; it is not functus officio. As the mandate of the Arbitrator had not yet been terminated, he was entitled to reconsider his decision and if he thought fit, as he did here, to reverse himself.

Comments: The CA took the view that the arbitration proceedings had not come to an end as there was an outstanding question as to costs and the arbitrator could reconsider issues, which had been decided by him.  Preliminary Points of Law Determination of preliminary point of law 45. —(1) Unless otherwise agreed by the parties, the Court may, on the application of a party to the arbitration proceedings who has given notice to the other parties, determine any question of law arising in the course of the proceedings which the Court is satisfied substantially affects the rights of one or more of the parties. (2) The Court shall not consider an application under this section unless — (a) it is made with the agreement of all parties to the proceedings; or (b) it is made with the permission of the arbitral tribunal and the Court is satisfied that — (i) the determination of the question is likely to produce substantial savings in costs; and (ii) the application is made without delay. (5) Except with the leave of the Court, no appeal shall lie from a decision of the Court on whether the conditions in subsection (2) are met. (6) The decision of the Court on a question of law shall be a judgment of the Court for the purposes of an appeal to the Court of Appeal. (7) The Court may give leave to appeal against the decision of the Court in subsection (6) only if the question of law before it is one of general importance, or is one which for some other special reason should be considered by the Court of Appeal.  Powers of Court Regarding Awards Made Enforcement of award 46. —(1) An award made by the arbitral tribunal pursuant to an arbitration agreement may, with leave of the Court, be enforced in the same manner as a judgment or order of the Court to the same effect. (2) Where leave of the Court is so granted, judgment may be entered in the terms of the award. (3) Notwithstanding section 3, subsection (1) shall apply to an award irrespective of whether the place of arbitration is Singapore or elsewhere. No judicial review of award 47. The Court shall not have jurisdiction to confirm, vary, set aside or remit an award on an arbitration agreement except where so provided in this Act. 

Hence, orders for certiorari, mandamus, etc. are not available to vary, set aside or remit an award.

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Furthermore, an application under Order 69 Rule 2 to declare that an award is not binding, would no longer be available as it is not specifically provided for in the Act.

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Section 48 lays down a number of reasons for which the High Court may set aside an award. This Section is based on Article 34 of the Model Law. Setting aside the award is not the same as an appeal, which is dealt with under Section 49

Court may set aside award 48. —(1) An award may be set aside by the Court — (a) if the party who applies to the Court to set aside the award proves to the satisfaction of the Court that — (i) a party to the arbitration agreement was under some incapacity; (ii) the arbitration agreement is not valid under the law to which the parties have subjected it, or failing any indication thereon, under the laws of Singapore; (iii) the party making the application was not given proper notice of the appointment of an arbitrator or of the arbitration proceedings or was otherwise unable to present his case; (iv) the award deals with a dispute not contemplated by or not falling within the terms of the submission to arbitration, or contains decisions on matters beyond the scope of the submission to arbitration, except that, if the decisions on matters submitted to arbitration can be separated from those not so submitted, only that part of the award which contains decisions on matters not submitted to arbitration may be set aside; (v) the composition of the arbitral tribunal or the arbitral procedure is not in accordance with the agreement of the parties, unless such agreement is contrary to any provisions of this Act from which the parties cannot derogate, or, in the absence of such agreement, is contrary to the provisions of this Act; (vi) the making of the award was induced or affected by fraud or corruption; (vii) a breach of the rules of natural justice occurred in connection with the making of the award by which the rights of any party have been prejudiced; or (b) if the Court finds that — (i) the subject-matter of the dispute is not capable of settlement by arbitration under this Act; or (ii) the award is contrary to public policy. (2) An application for setting aside an award may not be made after the expiry of 3 months from the date on which the party making the application had received the

award, or if a request has been made under section 43, from the date on which that request had been disposed of by the arbitral tribunal. (3) When a party applies to the Court to set aside an award under this section, the Court may, where appropriate and so requested by a party, suspend the proceedings for setting aside an award, for such period of time as it may determine, to allow the arbitral tribunal to resume the arbitration proceedings or take such other action as may eliminate the grounds for setting aside an award. 

The term “corruption” can be construed very widely as under the Prevention of Corruption Act. Basically taking any advantage is corruption. Corruption is not limited to just bribery alone.

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Award is contrary to public policy. Note that the scope of public policy is not defined, so it can be very broad, and a possible “unruly horse” if the phrase is not strictly construed.

Hainan Machinery Import & Export Corp [1996] 1 SLR 34.2 - Comments: Public policy did not require that this court refuse to enforce the award obtained by the plaintiffs. There was no allegation of illegality or fraud and enforcement would therefore not be injurious to the public good. The comity of nations required that the awards of foreign arbitration tribunals be given due deference [initial arbitration in tribunal from China] and be enforced unless exceptional circumstances exist. [and hence still not defined] As a nation that aspired to be an international arbitration centre, Singapore must recognise foreign awards if it expected its own awards to be recognised abroad. Harris Adacom Corp v Perkam Sdn Bhd [1991] 3 MLJ 504 - The defendant had entered into a distribution agreement with Harris Corporation, an American company, under which it owed the sum of RM538,000. Harris Corporation then sold its interests and assigned all its rights to the plaintiff. When the defendant failed to pay the debt, the plaintiff commenced arbitration proceedings in the United States. The defendant did not appear despite due notice and an award was made in favour of the plaintiff. The plaintiff applied to register the award under the Convention on the Recognition and Enforcement of Foreign Arbitral Awards Act 1985. - The defendant opposed the application on the grounds that: (i) it was contrary to public policy to enforce the award as the plaintiff was an Israeli company. - Held – “On the allegation that the plaintiff is an Israeli based company and, therefore, it is against public policy to have the award enforced, it is common ground that, in the foreign office declaration produced to this court, if it is so found that the plaintiff is an Israeli based company, it is against public policy to enforce it as trade with Israel is prohibited. 2

The respondent alleged that decision not based on law; no allegation of illegality or fraud, CIETAC award enforced.

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Is the fact so? This court need only refer to exh P7 referred to in the affidavit of Paul Owen Suttie at p 14 that the Malaysian Government`s stand vis-a-vis the state of Israel is not applicable and has no relevance in our present case and does not support the defendant`s argument. I find merit in the statement of LJ Zito of Harris Adacom, in a letter to the defendant, dated 12 July 1990 (exh A5) in the affidavit of DP Naban, encl (1), that clearly puts the correct position that the plaintiff is a United States corporation. The plaintiff like any other company has a 68% stake in a subsidiary company engaged in development and manufacturing operations in Israel but what is important for our consideration, and to be clear about, and the court is clear on this, that the products covered by the distribution agreement have been and would have continued to be developed, manufactured and supported from the plaintiff`s United States operation. For the reason stated above, I reject the defendant`s argument that it is against public policy to have this award enforced.

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Note that Section 48(3) does not amount to a real remission as it is intended to enable the tribunal to remedy only the alleged irregularities. One cannot review the case on its merits.

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It must also be noted that Section 48(1)(a)(vi), (vii) and (viii) can be possibly applied in situations where there can be said to be ‘misconduct” on the part of the arbitrator, although there is no concept of misconduct in the present Arbitration Act as compared to the old Act.

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With regards to Section 48(1)(a)(vii) (breach of the rules of natural justice), Lord Tucker in Russell v Duke of Norfolk [1949] 1 All ER 109 states that whatever standard is adopted,, the person concerned should have a reasonable opportunity of presenting his case (audi alteram partum). What does the phrase “breach of the rules of natural justice” mean? As was said by Lord Morris in Wiseman v Borneman [1971] AC 309, “Natural justice, it has been said, is only fair play in action”.

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In criticizing awards made by arbitrators, it is often alleged that findings have been made with little or no evidence, or that the aggrieved party was not given a chance to explain matters more fully, more so, as they cannot know what the arbitrators were thinking.

Bulfracht (Cyprus) Ltd v Boneset Shinninn Co Ltd (The “Pamphilos”) [2002] 2 Lloyds Rep 681 (This case involved inter alia Section 68 of the English Arbitration Act, which is somewhat similar to Section 48 of the new Singapore Arbitration Act.) Colman J – “The arbitrator’s duty was to give the parties a fair opportunity of addressing them on all factual issues material to their intended decision as to which there had been no reasonable opportunity to address them during the hearings…..  It has to be emphasized, however, that the duty to act fairly is quite distinct from the autonomous power of the arbitrators to make findings of fact. Thus, whereas it may normally be contrary to the arbitrator’s duty to fail to give to the parties an opportunity to address them on proposed findings of major areas of material primary 

facts which have not been raised during the hearing or earlier in the arbitral proceedings, it will usually not be necessary to refer back to the parties for further submissions every single inference of fact from the primary facts which arbitrators intend to draw, even if such inferences may not have been previously anticipated in the course of the arbitration. Particularly where there are complex factual issues it may often be impossible to anticipate by the end of the hearing exactly what inferences of fact should be drawn from the findings of primary fact which have been in issue. In such a case the tribunal does not have to refer back its evidential analysis for further submissions.” -

recent English case relevant to rules of natural justice or duty to act fairly – st george’s investment v Gemini consulting 2004 EWHC 2353 (Ch) o held tt arbitrator entitled to use his expert knowledge to arraive at his award; knowledge which he wld be reasonably expected to have and provded he isuses it to evaluate the vid called and not to introd new and diff evid o otherwise his duty to expose those matters for comnt by party concerned o arbitrator is also entitled to arrive at award by deploying evid in awy diff fr the way parties’ witnesses have deployed them; provided tt it addresses matter which has been put into arena

 Appeals against the award on a Question of Law Appeal against an Award -

What’s the difference btwn setting aside an award and appealing against an award? - Setting aside relates primarily to attacking the award based on irregularity. - Appealing deals with the merits of the case – not so much on arbitration – but on the question of law arising out of the award made in the proceedings. Appeal against award 49. —(1) A party to arbitration proceedings may (upon notice to the other parties and to the arbitral tribunal) appeal to the Court on a question of law arising out of an award made in the proceedings. (2) Notwithstanding subsection (1), the parties may agree to exclude the jurisdiction of the Court under this section and an agreement to dispense with reasons for the arbitral tribunal’s award shall be treated as an agreement to exclude the jurisdiction of the Court under this section. (3) An appeal shall not be brought under this section except — (a) with the agreement of all the other parties to the proceedings; or (b) with the leave of the Court.

(4) The right to appeal under this section shall be subject to the restrictions in section 50. (5) Leave to appeal3 shall be given only if the Court is satisfied that — (a) the determination of the question will substantially affect the rights of one or more of the parties; (b) the question is one which the arbitral tribunal was asked to determine; (c) on the basis of the findings of fact in the award — (i) the decision of the arbitral tribunal on the question is obviously wrong; or (ii) the question is one of general public importance and the decision of the arbitral tribunal is at least open to serious doubt; and (d) despite the agreement of the parties to resolve the matter by arbitration, it is just and proper in all the circumstances for the Court to determine the question. (6) An application for leave to appeal under this section shall identify the question of law to be determined and state the grounds on which it is alleged that leave to appeal should be granted. (7) The leave of the Court shall be required for any appeal from a decision of the Court under this section to grant or refuse leave to appeal. (8) On an appeal under this section, the Court may by order — (a) confirm the award; (b) vary the award; (c) remit the award to the arbitral tribunal, in whole or in part, for reconsideration in the light of the Court’s determination; or (d) set aside the award in whole or in part. (9)The Court shall not exercise its power to set aside an award, in whole or in part, unless it is satisfied that it would be inappropriate to remit the matters in question to the arbitral tribunal for reconsideration. (10) The decision of the Court on an appeal under this section shall be treated as a judgment of the Court for the purposes of an appeal to the Court of Appeal. (11) The Court may give leave to appeal against the decision of the Court in subsection (10) only if the question of law before it is one of general importance, or one which for some other special reason should be considered by the Court of Appeal. -

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The new Act differs from the old Act as follows: - The criteria for appeal: in old Act: if appealing to CA then must be question of general imptance - Under the new Act there are 5 conditions for appeal to HC, and for appeals to CA there is also the added requirement of public imptance The principles in The Nema are similar.

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Under Section 49(1) , an appeal must be on the basis of a question of law, and not secondary facts.

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The court will only grant leave to appeal if the grounds in S 49(5) are satisfied. - Note that under Section 49(5)(a), the rights of one or more of the parties must be “substantially” affected. - The phrase “obviously wrong” under Section 49(5)(c)(i) is a question of law which is subjective. - The phrase “open to serious doubt” under Section 49(5)(c)(ii) implies a standard lower than “obviously wrong” under Section 49(5)(c)(i). If one arbitrator out of three totally differs in opinion, that could qualify as serious doubt. A decision may be “open to serious doubt”, but may not be “obviously wrong”.

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It appears that “general importance” in Section 49(11) is of a broader standard than “general public importance” in Section 49(5)(c)(ii) since different phrasing is used. What is a matter of public importance? There is no decision on this point yet, but in Jeyaretnam’s case, it was said that a matter of public importance is not a one-off case.

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Note that the present provisions with regards to appeals against awards contained in section 49 (and the statutory criteria in Section 49(5) in particular) of the new Act have replaced the judge-made guidelines in the the HL decisions in The Nema [1980] 2 Lloyd’s Rep 339 and The Antaios [1985] AC 191 (widely referred to as The Nema/Antaios guidelines).

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Previously under the Nema/ Antaios guidelines, where the construction of a “one-off” contract or clause was in issue, the discretion was to be strictly exercised and leave to appeal normally refused unless the judge was satisfied that the construction given by the arbitrator was “obviously wrong”. - Where, however, what was in issue was the construction of a standard form contract or clause a less guarded approach was adopted. In such a case, the judge had to be satisfied as to two cumulative requirements before being prepared to consider giving leave to appeal. - First, he must be satisfied that the resolution of the question of construction would add significantly to the clarity, certainty and comprehensiveness of the law; and second when so satisfied, that there was strong prima facie evidence that the arbitrator had gone wrong in his construction.

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At the outset, I must state that while the criteria for appeal are set out in s 49 new Act and at first glance contrast extremely with the old s 28, on careful examination, one will find that our s 49 is merely a codification of the law as existed before the commencement of the new Act.

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In the case of Nema the court expounded the guidelines on when the court should grant leave to appeal.

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Law Commission’s Final Report on The Review of Arbitration Laws: • The principles that had consistently been applied by the courts in granting or refusing leave as enunciated in the leading case of The Nema are now spelt out in this clause.

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The Nema principles are thus relevant and the new Act is a mere codification of the law as stood then, revealed in parliamentary reports too.

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As stated in the Law Commission Report, our new Act was meant to incorporate the guidelines therefore guidelines clearly relevant:

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Under s 49(5)(c), the court may grant leave only where on the basis of the findings of fact in the award, (i) the decision of the arbitral tribunal is ‘obviously wrong’OR (ii) if the question is one of general public importance AND the decision of the arbitral tribunal is at least open to serious doubt

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Thus it would appear that s 49(5)(c)(i) refers to a case where leave will be granted in a one-off contract: i.e. where the arbitrator was ‘obviously wrong’. The test for granting leave here appears to be the exact phrase used by Lord Diplock in The Nema and the Antaios.

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Similarly, s 49(5)(c)(ii) mirrors the Nema/Antaios guidelines for granting leave in a standard form case: i.e. the ‘less guarded approach’. The provision also has cumulative requirements of the concepts of ‘general public importance’ and ‘open to serious doubt’ as stated in the Nema/Antaios guidelines in the form of ‘adding to the clarity of the law’ and ‘strong prima facie evidence that the arbitrator had gone wrong’.

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However, it does appear that our s 49 may lay down even stricter requirements for the granting of leave to appeal as s 49(5) also states as cumulative requirements that: - The determination of the question must ‘substantially affect’ the rights of one or more of the parties: s 49(5)(a), and - The question must be one which the arbitral tribunal was asked to determine: s 49(5)(b), and - The question of law must have as its basis the findings of fact by the tribunal: s 49(5)(c).

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As noted in the Law Commission’s Report, this it to prevent parties from trying to review a tribunal’s findings of facts by expressing it in the form of a question of law, and operates to ensure that the question of law has relevance to the facts as found Further, the power of the court to grant leave is discretionary and the court may refuse leave unless it is just and proper in all the circumstances

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OTOH, it could be said that these ‘additional’ requirements for leave were always also present before the enactment of the law, and the new AA just merely codified all the principles applicable.

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The leave of the court will be required for any appeal from a decision of the court to grant or refuse leave to appeal: s 49(7).

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After the court has heard an appeal against the award, another appeal from this appeal is possible. [ie Tribunal  HC  CA] - Here leave to appeal against the decision of the court is need and will only be given if the question of law is one of some general importance, or for some other special reason should be considered by the CA: s 49(11). - thus while a distinction is drawn in the criteria required in an appeal from the tribunal to the HC, and an appeal from the HC to the CA, there is some overlap. - Note also O 69 r 8: An application under the Arbitration Act for leave to appeal against a decision of the Court to the Court of Appeal must be made to the court within 7 days of the decision of the court.

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The Nema/ Antaios guidelines had been applied in Singapore in the cases of:

Invar Realty v JDC [1988] 3 MLJ 13.  (1).General guidelines for the granting of leave to appeal were set out in The Nema [1982] AC 724; [1981] 2 Lloyd`s Rep 239, as follows. Where a question of law involved was the construction of a `one-off` clause the application of which to the particular facts of the case was an issue in the arbitration, leave should not normally be given unless it was apparent to the judge upon a mere perusal of the reasoned award itself without the benefit of adversarial argument, that the meaning ascribed to the clause by the arbitrator was obviously wrong. Rather less strict criteria were appropriate where questions of construction of contracts in standard terms were concerned. But leave should not be given even in such a case, unless the judge considered that a strong prima facie case had been made out that the arbitrator had been wrong in his construction.  (2).The issues that were placed before the arbitrator upon which he made a finding were more questions of fact rather than questions of law. He was asked to determine whether the parties had agreed between them to extend the completion date by 101/2 months. The arbitrator answered the question in the affirmative after examining contemporaneous documents and hearing oral evidence from the parties. On this view, there could be no appeal to the High Court.  (3).If the court were wrong on the above view, then the guidelines in The Nema would be applied to determine whether leave should be given. Where, as in this case, a standard clause was to be applied to a `one-off` event, stricter criteria should be applied, ie if it was apparent to the judge upon a mere perusal of the reasoned award itself without the benefit of adversarial argument that the meaning ascribed to the clause by the arbitrator was obviously wrong; but if on such perusal it appeared to the judge that it was possible that arguments might persuade him, despite first impression

to the contrary, that the arbitrator might be right, he should not grant leave. On these criteria, there was nothing in the award to indicate to the court that the arbitrator was obviously wrong in his decision.  (4).The award of the arbitrator in the instant case could not be truly called a reasoned award. It was clearly an award to which s 28(6) applied.  (5).There was no special reason why a notice to the arbitrator before the award was made, that a reasoned award would be required, was not given by Invar. It followed therefore that there was no jurisdiction for the court to grant leave to order the arbitrator to give reasons. There should be finality to arbitration. Parties should not be allowed to wait and see how the award came out before they decide whether or not it should be a reasoned award. The principle behind this was fairness: reasons when given were available to both sides and they could each consider whether or not they should seek leave to appeal.  (6).If the the award given by the arbitrator was a reasoned award, though inadequate, and that s 28(6) did not apply, this court in considering whether leave should be granted to order the arbitrator to state further reasons for his award had to bear in mind at least the following two factors: (i) if further reasons were ordered and given, what prospect was there that leave to appeal against the award to the High Court would be granted in accordance with the guidelines set out in The Nema ; and (ii) no request for reasons was made by Invar to the arbitrator before the award was given. Invar had not satisfied any of these two criteria. In any event, a decision on those questions of law raised by Invar in this application would not add significantly to the clarity and certainty of the law. Each case would have to depend on its own facts. The facts in this case were special. American Home Assurance Co v Hong Lam Marine Pte Ltd [1999] 3 SLR 682  Held -- dismissing the appeal -- (1).The general principles governing the granting of leave to appeal against an award made on an arbitration agreement under s 28 of the Arbitration Act (Cap 10) (`the Act`) were as spelt out in the House of Lords decisions in The Nema and The Antaios , and have come to be widely referred to as The Nema/Antaios guidelines. These not only gave effect to the policy of the legislature to accord greater recognition to the finality of awards in matters of legal determination, but also illustrated the approach to be taken in particular circumstances encountered in practice, for instance the nature of the question of law in issue and whether its significance was confined to the arbitrating parties or was of wider interest.  (2).Where the construction of a `one-off` contract or clause was in issue, the discretion was to be strictly exercised and leave to appeal normally refused unless the judge was satisfied that the construction given by the arbitrator was `obviously wrong`. Where, however, what was in issue was the construction of a standard form contract or clause a less guarded approach was adopted. In such a case, the judge had to be satisfied as to two cumulative requirements before being prepared to consider giving leave to appeal. First, he must be satisfied that the resolution of the question of construction would add significantly to the clarity, certainty and comprehensiveness of the law; and second when so satisfied, that there was strong prima facie evidence that the arbitrator had gone wrong in his construction.

(3).In the instant case, the main question of law in issue - the scope and effect of the bonds issued by the appellants in favour of the respondents - had to be characterised as `one-off` rather than standard. The resolution of this question depended entirely on the true nature of the bonds which, it was trite law, was entirely a question of construction. In turn, the question of construction involved taking into account not only the words used by the parties to express their mutual obligations, but also the factual matrix or surrounding circumstances, and when all this was considered, it led to the conclusion that the question of law was `one-off` and not standard in character, for two reasons. First, the evidence showed that the relevant portions of the bonds were tailored to meet the parties` respective positions - the epitome of a `one-off` case; and second, the decision on the question of construction one way or the other would merely be another factual illustration of well-established principles and would be incapable of adding anything to the existing jurisprudence. The appellants therefore had to satisfy the court to the degree of an `obvious`, ie readily demonstrable error - that the award of the arbitrator was bad in law. In any event, if this was incorrect, they would not have succeeded in satisfying even the less stringent criteria of a `strong prima facie case` of error.  (4).Leave to appeal would be refused on the first issue. The bonds were clearly performance bonds payable on demand and not repayment or refund guarantees. Accordingly, the appellants were liable to pay on the respondents` demands made under the bonds which were triggered by the exercise of their rights of termination or rescission, notwithstanding that what was claimed was not repayment of the progress payments paid to the shipyard but possession of the vessel and damages. Neither a strong prima facie case was made out that the arbitrator had erred in his construction of the bonds, nor could it be said that he was obviously wrong. 

The Case Law Guidelines Elaborated -

The Nema/Antaios guidelines governed the approach that should be taken by judges when deciding whether to grant leave to appeal against an arbitration award and have now been incorporated into our s 49(5) AA. - Note however that clear guidelines in Nema now superceded by s49(5) - Do not have to show seriously wrong – merely that - decision of tribunal open to serious doubt and tt pt is one of general public importance (the commercial community)

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As summarised by the learned CJ in the American Home Assurance Case, Nema/Antaios state that: - If the construction of a `one-off` contract or clause was in issue, the discretion was to be strictly exercised and leave to appeal normally refused unless the judge was satisfied that the construction given by the arbitrator was `obviously wrong`. - Where, however, what was in issue was the construction of a standard form contract or clause a less guarded approach was adopted. In such a case, the judge had to be satisfied as to two cumulative requirements before being prepared to consider giving leave to appeal.

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First, he must be satisfied that the resolution of the question of construction would add significantly to the clarity, certainty and comprehensiveness of the law; and second when so satisfied, that there was strong prima facie evidence that the arbitrator had gone wrong in his construction

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On the ‘std terms test’

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As noted by CJ Yong in American Home Assurance, this two-step approach has been endorsed by the way in which the guidelines have been formulated in subsequent authorities:

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The Kerman [1982] 1 WLR 166 Parker J phrased the guideline in the following words: ‘... even if the decision on the question of construction in the circumstances of the particular case would add significantly to the clarity and certainty of English commercial law, leave should not be given unless the judge considers that a strong prima facie case that the arbitrator was wrong has been made out.’ [this is the std terms test] Aden Refinery v Ugland Mgt [1987] QB 650 Sir John Donaldson MR expressed his understanding of the guideline in the following terms (at p 659 of the report): ‘In the case of standard terms ... [judges] are advised to apply rather less strict criteria, taking account of whether or not a decision on the question or questions of law would add significantly to the clarity and certainty of English commercial law. But even then the advice is that leave to appeal should be refused, unless the judge considers that a strong prima facie case has been made out that the arbitrator has been wrong in his construction.

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On the one-off contract test

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Aden Refinery Co Ltd v Ugland Management Co Ltd [1987] QB 650 at p 659 Sir John Donaldson MR indicated that under ‘The Nema guidelines in the case of a "one-off" contractual clause, judges are advised to refuse leave to appeal if they consider that the arbitrator might have been right`. And in The Antaios Lord Diplock rephrased the test: `whether the arbitrator was in the judge`s view so obviously wrong as to preclude the possibility that he might be right`. American Home Assurance v Hong Lam Marine This was an appeal against the dismissal of the appellants` application for leave to appeal against the award of the arbitrator made in arbitration proceedings between the appellants and the respondents. The appellants, who were insurers and underwriters who were the issuers of performance bonds on behalf of a shipyard which had contracted to build a vessel for the respondent shipowners When the shipyard failed to deliver the vessel the respts repossessed the vessel and called on the performance bonds.

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In the arbitration btwn the respondents and appellants the arbitrator held that the shipowners were entitled to recover the amount expended in completing the vessel. ca held: - The guidelines to be applied in the exercise of judicial discretion to grant leave to appeal against an arbitral award have been laid down in The Nema and The Antaios. [see above for CJ’s summary of the guidelines] - These guidelines gave effect to the policy of the legislature to accord greater recognition to the finality of awards in matters of legal determination. On one-off and standard contracts: characterisation

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The essence of a `one-off` contract is that it is - one negotiated, drafted and agreed to de novo to accommodate the personal positions of the parties in the circumstance of the particular transaction they have entered into. - It has no wider application beyond the particular parties and their respective positions. raises an issue of concern which is confined to the particular contracting parties and `in which the general market and commercial fraternity has no interest`. It is a `question of a singular character unlikely to recur` But the facts of and the speeches in The Nema also illustrate that to fall within the category of `one-off` contracts a contract need not be wholly novel and original in its conception, design and drafting. A contract may be `one-off` notwithstanding that its basis is a standard form contract, if it has received substantial amendments and/or additions to meet the particular needs and expectations of the parties. On the other hand, it is equally clear that it is not every amendment, addition or deletion that is capable of converting a standard form contract into a `one-off` contract. It is ultimately a question of degree, and where the line is to be drawn may on occasions give rise to difficult questions. Nor will it necessarily be the case that a contract will be incapable of being characterised as `one-off` by virtue of the fact that it incorporates what may be described as some standard contractual terms. Although again in each case it will be a question of degree, the mere existence of some standard clauses will not result in what is primarily a `one-off` contract losing its dominant identity. The same difficulties arise when defining a `standard form` contract or clause. The traditional understanding of a standard form contract is that of a pre-prepared contract, invariably in printed form, which the parties adopt either directly by signing (whether in person or through agents) or indirectly by incorporation by reference or some other mode of adoption: Thomas at para 5.2.4.13. As in the case of a `one-off` contract, it is equally possible for a printed standard form contract or term to change its characterisation to a `one-off` contract or term by virtue of its amendment by the parties. It will in each case be a question of degree whether a particular amendment or cluster of amendments effect a change in characterisation of the contract as a whole or any contractual term.

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Contrariwise it would appear possible for standard terms incorporated into a `one-off` contract to retain their character as standard contractual terms provided they are capable of existing independently and their construction is not coloured by the new contractual environment: Thomas at para 5.2.4.15 But the crux of the `standard` concept is that `the potential interest extends beyond the immediate contracting parties to the community at large or to a determinable section of the community`. In the instant case, the main question of law in issue - the scope and effect of the bonds issued by the appellants in favour of the respondents - had to be characterised as `one-off` rather than standard. The resolution of this question depended entirely on the true nature of the bonds which, it was trite law, was entirely a question of construction. In turn, the question of construction involved taking into account not only the words used by the parties to express their mutual obligations, but also the factual matrix or surrounding circumstances, and when all this was considered, it led to the conclusion that the question of law was `one-off` and not standard in character, for two reasons. First, the evidence showed that the relevant portions of the bonds were tailored to meet the parties` respective positions - the epitome of a `one-off` case; and Second, the decision on the question of construction one way or the other would merely be another factual illustration of well-established principles and would be incapable of adding anything to the existing jurisprudence. The appellants therefore had to satisfy the court to the degree of an `obvious`, ie readily demonstrable error - that the award of the arbitrator was bad in law. In any event, if this was incorrect, they would not have succeeded in satisfying even the less stringent criteria of a `strong prima facie case` of error On what is ‘obviously wrong’ in a one-off contract In the final analysis, the important question is whether an error can be demonstrated quickly and easily; if hours of legal argument are required, the applicant will not have succeeded in satisfying the court that the award is `obviously wrong`. On what is ‘strong prima facie case’ that was wrong in a std term contract In contrast, the courts will be more ready to entertain a question of law relating to the construction of a standard form contract or clause than is the case with a `one-off` contract or clause, notwithstanding the initial reference to arbitration. A less guarded approach is adopted; and the courts are more willing to substitute their own determination for that of the arbitrator. If the judge is satisfied that the arbitrator is right or is probably right or there is at the very least a strong prima facie case that the arbitrator is right, then normally leave ought to be refused (see, eg Aden Refinery (supra), notwithstanding that an appeal might contribute beneficially to the development of the law. The test is clearly less strict than that applicable to the category of `one-off` contracts and clauses, but otherwise raises difficulties as to its precise meaning. However some factors pointing towards the presumption in favour of finality: If the parties selected as an arbitrator an experienced lawyer of many year’s standing

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and in so far as the dispute centred on a question of construction of the contract and other related issues of law, must be assumed to have had good reason for relying on the arbitrator`s legal expertise. On policy grounds: Finality as the intention of the Legislature Comments on American Home Assurance: Although this case decides whether leave to appeal should be granted under the old repealed AA and not our new AA, it is still very relevant as it makes reference the Nema/Antaios guidelines which are clearly relevant under our new AA. [see above.] On std/one-off contracts: characterisation of the contract In the case we were dealing with performance bonds – which cld be construed as a std contract. However, because of the special circumstances of the case, the bonds were construed as one-off contracts. Thus it appears that the characterisation of a contract may not be so straightforward. The factual matrix of each case has to be carefully considered before one can characterise the contract. On ‘obviously wrong’ Does this refer to obviously wrong on the facts or on the law? Seems like referring to the decision of law, as based on the findings of facts, is obviously wrong. The requirement of ‘obviously wrong’ is necessary because of the principle of finality, parliamentary intention, and the fact that the parties had themselves agreed to go for arbitration and thus should be bound by the arbitral decisions. I.e. it must be more than debatable, it must be clear. I think that what will be considered ‘obviously wrong’ cannot just be an issue of law, but there must be some policy decisions involved. Finality Do not want long arguments: inefficient. Singapore hates inefficiency. Commercial reasons for wanting Singapore to be commercial international arbitration hub. On substantially affecting the parties’ rights If the claim was for 10k and you lost because of a question of law or interpretation, have your rights been substantially affected? What if it was for $1? What if is was for $1 for a very fundamental question of law? Probably still cannot appeal What if lost 1m? Then to me would be a lot. But what if it was Bill Gates? What if was poor contractor? Thus whether a parties rights were substantially affected would depend on the facts of the case

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However, some guideline to consider would be that if want to appeal to CA, would need to obtain leave if the amount claimed falls below $250k. The Nema Here the case concerned whether continued strikes by stevedores had the effect of frustrating a charterparty. Lord Diplock: As Lord Denning M.R. summarised it in dealing with the question of frustration in the instant case: to justify interference with the arbitrator's award it must be shown (i) that the arbitrator misdirected himself in law or (ii) that the decision was such that no reasonable arbitrator could reach. Parliament's intention to promote greater finality in arbitral awards than was being achieved under the previous procedure as it was applied in practice is evidenced by the removal for judicial review for an error on the face of the record, and the need for leave to appeal except where all parties consent. Where, as in the instant case, a question of law involved is the construction of a "oneoff" clause, leave should not normally be given: Unless it is apparent to the judge upon a mere perusal of the reasoned award itself without the benefit of adversarial argument, that the meaning ascribed to the clause by the arbitrator is obviously wrong. But if on such perusal it appears to the judge that it is possible that argument might persuade him, despite first impression to the contrary, that the arbitrator might be right, he should not grant leave; the parties should be left to accept, for better or for worse, the decision of the tribunal that they had chosen to decide the matter in the first instance. Rather less strict criteria are in my view appropriate where questions of construction of contracts in standard terms are concerned. That there should be a high degree of legal certainty as to how such terms apply upon the occurrence of events of this kind The Antaios Here, in times when mkt prices for hire were rising, the shipowners withdraw their vessel from the service of the charterers on the grounds that inaccurate B/Ls had been issued. The arbitrator found that the breach by the charterers was non-repudiatory and did not give the S/O a right of withdrawal. Hl held (lord diplock): On granting leave to appeal:  Even in a case which turns on the construction of a standard term, the mere fact that there are conflicting commercial opinions would not normally in itself be a reason for departing from the Nema guidelines.  Applications in such cases should ‘normally be dealt with on the papers alone.’  My Lords, to permit any prolonged and therefore costly arguments on applications for leave to appeal to the High Court would only assist in frustrating the policy of Parliament.

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On granting leave to appeal from a granting/refusal to grant leave to appeal [our s 49(7) sitn]:  This brings me to the "(6A) question" canvassed in Staughton J.'s second judgment of 19 November 1982: when should a judge give leave to appeal to the Court of Appeal from his own grant or refusal of leave to appeal to the High Court from an arbitral award?  I agree with him that leave to appeal to the Court of Appeal should be granted by the judge under section 1(6A) [Our s 49(7)] only in cases where a decision whether to grant or to refuse leave to appeal to the High Court under section 1(3)(b) [our s 49(5)] in the particular case in his view called for some amplification, elucidation or adaptation to changing practices of existing guidelines laid down by appellate courts; and that leave to appeal under section 1(6A) should not be granted in any other type of case.  Judges should have the courage of their own convictions and decide for themselves whether, applying existing guidelines, leave to appeal to the High Court under section 1(3)(b) ought to be granted or not.

But now the statutory provisions in the new Section 49 replace the Nemas/ Antaios guidelines. This point was well brought out in the English CA decision of The North Pioneer [2003] 1 WLR 1015.  It was emphasized that under Section 69 of the English Act (in pari materia with the Singapore Section 49), before a Judge could grant permission to appeal, he was required to find both that the decision of the arbitrators was obviously wrong or was a point of general public importance and that the said decision was at least open to serious doubt. Furthermore the Judge was to be satisfied that the question of law arising out of the award would substantially affect the rights of one or more of the parties.  Lord Philips MR also pointed out that the guidelines laid down in The Nema by Lord Diplock that the arbitrator had to be “wrong in his construction” had been superceded by Section 69(3)(c)(ii) [Singapore Section 49(5)(c)(ii)] and imposed a test broader than Lord Diplock’s requirement. Hence, changing circumstances can raise issues of general public importance with regards to terms or clauses that are not covered by judicial decision.  It also follows that in certain arbitrations where there is more than one arbitrator (there were 3 in the above case), differences in view between them may itself provide a ground for contending that the decision of the majority is “at least open to serious doubt”. 

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In view of The North Pioneer 2003 1 WLR 1015, the guidelines previously adopted by the Singapore courts in Invar Realty and American Home Assurance Co. will have to be carefully studied.

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In northen elevator manufacturing v united engineers 2004 2 SLR 594 – CA had chance to disting bet qn of law and error of law - In tt case HC had granted leave to appeal on qn whether arbitrator cld properly at law have assessed damages in manner he did

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CA took view tt qn of law must nec be finding of law which parties dispute and which req guidance of ocurt to resolve Merely an errofr of alw when arbitrator deos not apply principle of law correctly and this does not entitle aggrieved party to appeal

Liew ter kwang v hurry general contractor 2004 3 SLR 59 – decided under old act also but may have some relevance wrt reqt of decisions of law applying for leave to appeal - 3 qns of law involved in std lump sum building contract and held inter alia by Judith prakash J tt determoination of qns of law wld have substantial effect on rights of one or more parties to arbitration - leave to appeal accordingly given

Other Provisions regarding appeal The Appeal Procedure  On application or appeal the court may order the arbitral tribunal to state reasons for its award where such reasons are absent: s 50(4)(a) or insufficient: s 50(4)(b). 

The Court may also order the applicant to provide security for costs of the appeal: s 50(5), subject to the restrictions in s 50(6).

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The need for quick resolution of the dispute is also reflected in s 52(2) where the court in hearing an application for leave shall determine the application without a hearing unless it appears to the court that this is required. This adopts Lord Diplock’s approach in The Antaios, as the hearing of lengthy arguments would frustrate the intention of the AA. As noted by Lord Roskill in The Antaios, ‘one purpose of arbitration, especially in commercial disputes, is the avoidance of delays traditionally if often unfairly associated with the judicial process. The award of an arbitral tribunal can, it is supposed, be obtained swiftly and simply and without elaboration.’

Supplementary provisions to appeal under section 49 50. —(1) This section shall apply to an application or appeal under section 49. (2) An application or appeal may not be brought if the applicant or appellant has not first exhausted — (a) any available arbitral process of appeal or review; and (b) any available recourse under section 43 (correction or interpretation of award and additional award). (3) Any application or appeal shall be brought within 28 days of the date of the award or, if there has been any arbitral process of appeal or review, of the date when the applicant or appellant was notified of the result of that process. (4) If on an application or appeal it appears to the Court that the award — (a) does not contain the arbitral tribunal’s reasons; or (b) does not set out the arbitral tribunal’s reasons in sufficient detail to enable the Court to properly consider the application or appeal, the Court may order the arbitral tribunal to state the reasons for its award in sufficient detail for that purpose.

(5) Where the Court makes an order under subsection (4), it may make such further order as it thinks fit with respect to any additional costs of the arbitration resulting from its order. (6) The Court may order the applicant or appellant to provide security for the costs of the application or appeal, and may direct that the application or appeal be dismissed if the order is not complied with. (7) The power to order security for costs shall not be exercised by reason only that the applicant or appellant is — (a) an individual ordinarily resident outside Singapore; or (b) a corporation or association incorporated or formed under the law of a country outside Singapore or whose central management and control is exercised outside Singapore. (8) The Court may order that any money payable under the award shall be brought into Court or otherwise secured pending the determination of the application or appeal, and may direct that the application or appeal be dismissed if the order is not complied with. (9) The Court may grant leave to appeal subject to conditions to the same or similar effect as an order under subsection (6) or (8) and this shall not affect the general discretion of the Court to grant leave subject to conditions. Effect of order of court on appeal  Where the court varies the award, the variation shall have effect as part of he arbitral tribunal’s award: s 51(2).  Where the award is remitted, the tribunal shall make a fresh award within 3 months, or as the court may otherwise direct: s 51(3)  In many old contracts and in particular insurance policies, arbitration clauses require a party to first obtain an arbitral award as a condition precedent to commencement of Court proceedings – Such clauses are known as Scott v Avery clauses, and in such an instance a party would have no recourse but to recommence arbitration to get another award.  S 51(4) thus gives the court discretionary power to override the effect of such a clause over the subject matter covered in the award which has been set aside or declared to be of no effect. Effect of order of Court upon appeal against award 51. —(1) Where the Court makes an order under section 49 with respect to an award, subsections (2), (3) and (4) shall apply. (2) Where the award is varied by the Court, the variation shall have effect as part of the arbitral tribunal’s award. (3) Where the award is remitted to the arbitral tribunal, in whole or in part, for reconsideration, the tribunal shall make a fresh award in respect of the matters remitted within 3 months of the date of the order for remission or such longer or shorter period as the Court may direct. (4) Where the award is set aside or declared to be of no effect, in whole or in part, the Court may also order that any provision that an award is a condition precedent to the bringing of legal proceedings in respect of a matter to which the arbitration agreement

applies, shall be of no effect as regards the subject-matter of the award or, as the case may be, the relevant part of the award. Application for leave of Court, etc. 52. —(1) An application for the leave of the Court to appeal or an application referred to in section 21 (10), 36 (6) or 49 (3) (b) or (7) shall be made in such manner as may be prescribed in the Rules of Court. (2) The Court shall determine an application for leave to appeal without a hearing unless it appears to the Court that a hearing is required. (3) For the purposes of this section — (a) an application for leave of the Court may be heard and determined by a Judge in Chambers; and (b) the Court of Appeal shall have the like powers and jurisdiction on the hearing of such applications as the High Court or any Judge in Chambers has on the hearing of such applications. Some miscellaneous provisions Notice and other requirements in connection with legal proceedings 53. —(1) References in this Act to an application, appeal or other step in relation to legal proceedings being taken upon notice to the other parties to the arbitration proceedings, or to the arbitral tribunal, are references to such notice of the originating process as is required by the Rules of Court. (2) Subject to any provision made by Rules of Court, a requirement to give notice to the arbitral tribunal of legal proceedings shall be construed — (a) if there is more than one arbitrator, as a requirement to give notice to each of them; and (b) if the arbitral tribunal is not fully constituted, as a requirement to give notice to any arbitrator who has been appointed. (3) References in this Act to making an application or appeal to the Court within a specified period are references to the issue within that period of the appropriate originating process in accordance with the Rules of Court. (4) Where any provision of this Act requires an application or appeal to be made to the Court within a specified time, the Rules of Court relating to the reckoning of periods, the extending or abridging of periods, and the consequences of not taking a step within the period prescribed by the Rules, shall apply in relation to that requirement. (5) Provision may be made by Rules of Court amending the provisions of this Act — (a) with respect to the time within which any application or appeal to the Court must be made; (b) so as to keep any provision made by this Act in relation to arbitral proceedings in step with the corresponding provision of the Rules of Court applying in relation to proceedings in the Court; or

(c) so as to keep any provision made by this Act in relation to legal proceedings in step with the corresponding provision of the Rules of Court applying generally in relation to proceedings in the Court. (6) Nothing in this section shall affect the generality of the power of the Rules Committee to make Rules of Court. Proceedings to be heard otherwise than in open court 56. Proceedings under this Act in any court shall, on the application of any party to the proceedings, be heard otherwise than in open court. Restrictions on reporting of proceedings heard otherwise than in open court 57. —(1) This section shall apply to proceedings under this Act in any court heard otherwise than in open court. (2) A court hearing any proceedings to which this section applies shall, on the application of any party to the proceedings, give directions as to whether any and, if so, what information relating to the proceedings may be published. (3) A court shall not give a direction under subsection (2) permitting information to be published unless — (a) all parties to the proceedings agree that such information may be published; or (b) the court is satisfied that the information, if published in accordance with such directions as it may give, would not reveal any matter, including the identity of any party to the proceedings, that any party to the proceedings reasonably wishes to remain confidential. (4) Notwithstanding subsection (3), where a court gives grounds of decision for a judgment in respect of proceedings to which this section applies and considers that judgment to be of major legal interest, the court shall direct that reports of the judgment may be published in law reports and professional publications but, if any party to the proceedings reasonably wishes to conceal any matter, including the fact that he was such a party, the court shall — (a) give directions as to the action that shall be taken to conceal that matter in those reports; and (b) if it considers that a report published in accordance with directions given under paragraph (a) would be likely to reveal that matter, direct that no report shall be published until after the end of such period, not exceeding 10 years, as it considers appropriate. Application to references under statutory powers 58. This Act shall apply in relation to every arbitration under any other written law (other than the International Arbitration Act (Cap. 143A)), as if the arbitration were commenced pursuant to an arbitration agreement, except in so far as this Act is inconsistent with that other written law. Immunity of arbitral institutions 59. —(1) The appointing authority, or an arbitral or other institution or person designated or requested by the parties to appoint or nominate an arbitrator, shall not be

liable for anything done or omitted in the discharge or purported discharge of that function unless the act or omission is shown to have been in bad faith. (2) The appointing authority, or an arbitral or other institution or person by whom an arbitrator is appointed or nominated, shall not be liable, by reason only of having appointed or nominated him, for anything done or omitted by the arbitrator, his employees or agents in the discharge or purported discharge of his functions as arbitrator. (3) This section shall apply to an employee or agent of the appointing authority or of an arbitral or other institution or person as it applies to the appointing authority, institution or person himself. Service of notices 60. —(1) The parties are free to agree on the manner of service of any notice or other document required or authorised to be given or served in pursuance of the arbitration agreement or for the purposes of the arbitration proceedings. (2) If or to the extent that there is no such agreement as is referred to in subsection (1), subsections (3) and (4) shall apply. (3) A notice or other document may be served on a person by any effective means. (4) If a notice or other document is addressed, prepaid and delivered by post — (a) to the addressee’s usual or last known place of residence or, if he is or has been carrying on a trade, profession or business, his usual or last known place of business; or (b) if the addressee is a body corporate, to the body corporate’s registered office, it shall be treated as effectively served. (5) This section shall not apply to the service of documents for the purposes of legal proceedings, for which provision is made by Rules of Court. (6) References in this Part to a notice or other document include any form of communication in writing and references to giving or serving a notice or other document shall be construed accordingly. Reckoning periods of time 61. —(1) The parties may agree on the method of reckoning periods of time for the purposes of — (a) any provision agreed by them; or (b) any provision of this Act having effect in default of such agreement. (2) If or to the extent that the parties have not agreed on the method of reckoning time, periods of time shall be reckoned in accordance with this section. (3) Where the act is required to be done within a specified period after or from a specified date, the period shall begin immediately after that date.

(4) Where an act is required to be done within or not less than a specified period before a specified date, the period shall end immediately before that date. (5) Where the act is required to be done, a specified number of clear days after a specified date, at least that number of days shall intervene between the day on which the act is done and that date. (6) Where the period in question being a period of 7 days or less would include a Saturday, Sunday or a public holiday, that day shall be excluded. Confidentiality of Arbitration Proceedings -

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The case of Myanma Yaung Chi Oo Co Ltd v Win Win Nu and another [2003] 2 SLR 547 brought out several important features with regard to the confidential nature of arbitration proceedings. In that case, the second defendant had commenced arbitration proceedings against the Government of Myanmar. The Plaintiffs (a joint venture between the Government of Myanmar and the first defendant) had filed the present legal proceedings in Singapore against the first and second defendants. In an application for striking out, the first defendant had inter alia referred to the arbitration proceedings and exhibited documents in those arbitration proceedings. The main issue before the High Court was whether parties in arbitration proceedings have a duty to maintain confidentiality of the documents in those proceedings, and whether leave of court was necessary for disclosure. The learned judge (Kan Ting Chu J) discussed relevant English and Australian decisions. He preferred the English approach over the Australian. He agreed that it was more in keeping with the parties’ expectations to take the position that the proceedings are confidential (There was an implied obligation on a party obtaining documents not to disclose them or use them for any purpose other than the dispute in which they were obtained), and that disclosures can be made in accepted circumstances (with the consent of the other party or by order or leave of the court, where it was reasonably necessary or where it was in the interests of justice). The learned judge also held that there was no need to obtain the leave of the court before making the disclosure. However, after disclosure is made, the party which argues that it was not reasonably necessary to disclose (the “reasonably necessary” exception) can apply to expunge the disclosure and the court will then decide whether it was reasonably necessary to disclose. It was held that the time of application, the disclosure of the arbitration pleadings and documents were reasonably necessary as it was required to support the defendant’s case that the plaintiff’s suit was vexatious and an abuse of court. However, by the time of the appeal, the arbitration tribunal had held that it had no jurisdiction to hear the matter thereby ending the arbitration proceedings. Hence it was no longer reasonably necessary for any disclosure to be made.

Mediation and Arbitration 

mediation increasingly popular and SMC under academy of law in addition to sg international arbitration center

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note tt apptment of mediator as arbitrator is regarded as proper if agreement so proides; in practice such apptmnent may not vbe desirable since person concerned is acting as mediator and cld have heard each party alone and listened to their one sided stories; cld be persuaded by any one side

Appointment of mediator 62. —(1) In any case where an agreement provides for the appointment of a mediator by a person who is not one of the parties and that person refuses to make the appointment or does not make the appointment within the time specified in the agreement or, if no time is so specified, within a reasonable time of being requested by any party to the agreement to make the appointment, the Chairman of the Singapore Mediation Centre may, on the application of any party to the agreement, appoint a mediator who shall have the like powers to act in the mediation proceedings as if he had been appointed in accordance with the terms of the agreement. (2) The Chief Justice may, if he thinks fit, by notification published in the Gazette, appoint any other person to exercise the powers of the Chairman of the Singapore Mediation Centre under subsection (1). (3) Where an arbitration agreement provides for the appointment of a mediator and further provides that the person so appointed shall act as an arbitrator in the event of the mediation proceedings failing to produce a settlement acceptable to the parties — (a) no objection shall be taken to the appointment of such person as an arbitrator, or to his conduct of the arbitral proceedings, solely on the ground that he had acted previously as a mediator in connection with some or all of the matters referred to arbitration; and (b) if such person declines to act as an arbitrator, any other person appointed as an arbitrator shall not be required first to act as a mediator unless a contrary intention appears in the arbitration agreement. (4) Unless a contrary intention appears therein, an agreement which provides for the appointment of a mediator shall be deemed to contain a provision that in the event of the mediation proceedings failing to produce a settlement acceptable to the parties within 4 months, or such longer period as the parties may agree to, of the date of the appointment of the mediator or, where he is appointed by name in the agreement, of the receipt by him of written notification of the existence of a dispute, the mediation proceedings shall thereupon terminate. Power of arbitrator to act as mediator 63. —(1) If all parties to any arbitral proceedings consent in writing and for so long as no party has withdrawn his consent in writing, an arbitrator may act as a mediator. (2) An arbitrator acting as a mediator — (a) may communicate with the parties to the arbitral proceedings collectively or separately; and (b) shall treat information obtained by him from a party to the arbitration proceedings as confidential, unless that party otherwise agrees or unless subsection (3) applies.

(3) Where confidential information is obtained by an arbitrator from a party to the arbitration proceedings during mediation proceedings and those proceedings terminate without the parties reaching agreement in settlement of their dispute, the arbitrator shall before resuming the arbitration proceedings disclose to all other parties to the arbitration proceedings as much of that information as he considers material to the arbitration proceedings. (4) No objection shall be taken to the conduct of arbitration proceedings by a person solely on the ground that that person had acted previously as a mediator in accordance with this section. (5) For the purposes of this section and section 62 — (a) any reference to a mediator shall include a reference to any person who acts as a conciliator; (b) any reference to mediation proceedings shall include a reference to conciliation proceedings. Act binds Government Act to bind Government 64. This Act shall bind the Government. Transitional Provisions Transitional provisions 65. —(1) This Act shall apply to arbitration proceedings commenced on or after 1st March 2002 but the parties may in writing agree that this Act shall apply to arbitration proceedings commenced before that date. (2) Notwithstanding the repeal of the Arbitration Act (Cap. 10, 1985 Ed.), where the arbitration proceedings were commenced before 1st March 2002, the law governing the arbitration agreement and the arbitration shall be the law which would have applied if this Act had not been enacted. (3) Where an arbitration agreement made or entered into before 1st March 2002 provides for the appointment of an umpire or an arbitral tribunal comprising 2 arbitrators, the law to the extent that it governs the appointment, role and function of the umpire shall be the law which would have applied if this Act had not been enacted. (4) For the purposes of this section, arbitration proceedings are to be taken as having commenced on the date of the receipt by the respondent of a request for the dispute to be referred to arbitration, or, where the parties have agreed in writing that any other date is to be taken as the date of commencement of the arbitration proceedings, then on that date.