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'''The High Court Proceedings'''
RALL commenced proceedings in the High Court of Singapore to set aside the Award. The Judge dismissed RALL’s application, noting that a party’s failure to challenge a Tribunal’s ruling on jurisdiction as a preliminary issue had a preclusive effect, in that such party could not bring a jurisdictional challenge in subsequent proceedings in the courts of the jurisdictional seat of the arbitration (in this case, Singapore) to set the Award aside. The Judge also decided that the preclusive effect of Art 16(3) of the UNCITRAL Model Law on International Commercial Arbitration (Model Law) - see footnote No.1 - and s10(3) of the International Arbitration Act (the “IAA”) - see footnote No.2 - applied equally to a party that had not participated in the arbitral proceedings. The Judge was of the view that even if RALL was not precluded from bringing its jurisdictional challenge, the Tribunal’s mandate was not put to an end by virtue of the MOU. RALL proceeded to appeal to the Court of Appeal.
'''Decision of the Court of Appeal'''
This case establishes that a party which did not participate in an arbitration is entitled to raise a jurisdictional objection to set aside an arbitral award even though it failed to utilise the mechanism provided under Art 16(3) of the Model Law to appeal to the High Court against the Tribunal’s decision on its jurisdiction. However, it is important to note that the party will only be able to defend the arbitration claims on substantive grounds if it is correct in its belief that a tribunal lacks jurisdiction. Otherwise, it would then be left with a valid award against it.
Fn.1 Art 16(3) of the Model Law reads:
“(3) The arbitral tribunal may rule on a plea [that it does not have jurisdiction] either as a preliminary issue or in an award on the merits. If the arbitral tribunal rules as a preliminary question that it has jurisdiction, any party may request within thirty days after having received notice of that ruling, the [Singapore High Court] to decide the matter, which decision shall be subject to no appeal; while such a request is pending, the arbitral tribunal may continue the arbitral proceedings and make an award.
Fn.2 S.10(3) of the International Arbitration Act reads:
(3) If the arbitral tribunal rules —
(a) on a plea as a preliminary question that it has jurisdiction; or
(b) on a plea at any stage of the arbitral proceedings that it has no jurisdiction,
any party may, within 30 days after having received notice of that ruling, apply to the General Division of the High Court to decide the matter.
