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'''High Court of Singapore; Chong J; [2015] SGHC 65; 20 January 2014'''
'''RBITRATIONARBITRATION: SETTING ASIDE: WHETHER THE TRIBUNAL’S FAILURE TO CLOSE THE PROCEEDINGS AS REQUIRED BY THE RULES OF THE SINGAPORE INTERNATIONAL ARBITRATION CENTRE (SIAC) WAS A BREACH OF THE PARTIES’ AGREED PROCEDURE OR A BREACH OF NATURAL JUSTICE: WHETHER THE RELEASE OF AN AWARD 19 MONTHS AFTER CLOSING SUBMISSIONS WAS CONTRARY TO THE PUBLIC POLICY OF SINGAPORE'''
Gabriel Peter and Chong En Lai (Gabriel Law Corporation) for Coal & Oil
Coal & Oil’s grounds for setting aside
Coal & Oil sought to set aside the Award under the following grounds:
The High Court considered each of these facts in turn, and whether or not they could have the legal effect asserted by Coal & Oil.
Whether the Arbitrator’s alleged Failure to Close Proceedings satisfied any of the three grounds for setting aside
Chong J first considered the question of whether the alleged Failure to Close Proceedings was a breach of rule 27.1 of the SIAC Rules 2007. Rule 27.1 provided as follows.
"27.1 Before issuing any award, the Tribunal shall submit it in draft form to the Registrar. Unless the Registrar extends time or the parties agree otherwise, the Tribunal shall submit the draft award to the Registrar within 45 days from the date on which the Tribunal declares the proceedings closed. The Registrar may suggest modifications as to the form of the award and, without affecting the Tribunal’s liberty of decision, may also draw its attention to points of substance. No award shall be issued by the Tribunal until it has been approved by the Registrar as to its form. "
It was not in dispute that the Arbitrator had never declared the proceedings closed. The key question was whether the Tribunal was obliged, or merely empowered, to declare the closure of proceedings. Chong J held that rule 27.1 granted the Tribunal a mere power to close the proceedings for the following reasons.
The judge further held that, in any event, the Arbitrator’s failure to issue a declaration of the closure of proceedings was merely a technical, arid breach which was not a material breach of procedure compelling the court to exercise its discretion to set aside the award.
Whether the Lapse of Time in the issuance of the Award satisfied any of the three grounds for setting aside
16(1) A party may request the Court to remove an arbitrator –
(a) …
(b) Who has refused or failed –
(i) To properly conduct the proceedings; or
(ii) To use all reasonable dispatch in conducting the proceedings or making an award.
Further, if the delay were truly intolerable, Coal & Oil ought to have applied under Article 14 of the Model Law for the mandate of the arbitrator to be terminated before the Award was released. Article 14 of the Model Law is similar to s.16 of Singapore’s International Arbitration Act and provides in pertinent part as follows.
Article 14- Failure or Impossibility to Act
(1) If an arbitrator becomes de jure or de facto unable to perform his functions or for other reasons fails to act without undue delay, his mandate terminates if he withdraws from his office or if the parties agree on the termination…
However, Coal & Oil did not do so, leading Chong J to infer that it was “only making the argument now because the Award that was issued was adverse to Coal & Oil and not because of any delay”.
Application of the Judge’s findings above to the three grounds of appeal
Further, Chong J opined that Coal & Oil had conflated the concept of public interest with that of public policy: “[t]he public interest is the wider concept. It embraces everything that is conducive to the public good ranging from the comparatively minor (clean streets) to the vital (a robust criminal justice system). An innumerable number of things could be described as not being in the public interest. However, the concept of “public policy” in the context of the setting aside of an arbitral award, as noted at [61] above, is much narrower. Violations of “public policy” only encompass those acts which are so egregious that elementary notions of morality have been transgressed. While delay in the release of an arbitral award might not necessarily be in the public interest, it cannot, in itself without more, constitute a violation of public policy”.
'''Comment '''
This decision highlights the Singapore Courts’ faithfulness to the text of the Model Law and Singapore’s International Arbitration Act when faced with an application to set aside arbitral awards. The Court made the following observations as a prelude to its findings:
