Legal Update April 2014

SINGAPORE ARBITRATION UPDATES

Joining a party to an existing arbitration – The “Titan Unity” (No 2) [2014] SGHCR 04

This case dealt with the questionof whether the court could order a party to be joined to an arbitration.

The Court concluded that the consent of the parties to the existing arbitration and the party seeking to join or to be joined to the arbitration was a necessary condition for there to be joinder. To determine this consent, the Court has to give regard to “the context and the objective circumstances” to ascertain the parties’ objective intentions.

In this case, the Court found that the parties in this case did indeed impliedly consent to have the dispute resolved in arbitration. However, it declined to join the non-party to the arbitration. The Court took the position that such joinder should be decided by the arbitral tribunal instead.

This case illustrates the importance of consent and that in the absence of consent, it might not be possible to consolidate two arbitrations or join a party to an existing arbitration even where the facts and issues of the respective claims overlap.

What happens to arbitral proceedings after an award has been set aside L W Infrastructure Pte Ltd v Lim Chin San Contractors Pte Ltd [2013] SGHC 264

This case dealt with the question of what happens to arbitral proceedings after an award has been set aside. The Court held the status of arbitral proceedings after an award has been set aside is dependent on:

 1.         Whether the award was made within power or beyond power, and;

 2.         The extent to which the arbitral tribunal is conferred jurisdiction over the dispute by the arbitration agreement.

Arbitral award made “within power”

 The tribunal would have performed its duties with respect to the issues covered in that award. Thus, arbitral proceedings have to be recommenced before a newly constituted tribunal, assuming the underlying arbitration agreement is still valid and there is no time bar.

Arbitral award made “beyond power”

1. If the arbitral tribunal lacks jurisdiction, then it would not be vested with jurisdiction to deal with the matter merely because the award has been set aside. This is because the arbitral tribunal was not vested with jurisdiction in the first place when it made the award. Depending on the reason why the tribunal lacked jurisdiction, parties may be able to recommence arbitral proceedings. For example, if the initial tribunal was improperly appointed, then parties may reappoint a newly constituted tribunal in accordance with the arbitration agreement and recommence proceedings.

2. If the tribunal did not have power to issue the award in the form that it did, but nevertheless had jurisdiction under the arbitration agreement to decide the issues, then the same tribunal can determine those issues in a subsequent award. Arbitral proceedings would not have to be recommenced before a newly constituted tribunal because the original tribunal did not complete its mandate to decide all the issues between the parties in the first place. Such situations can be expected to be rare and would be an exception rather than the norm.

 

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This update is for general information only and is it not intended to constitute legal advice. JTJB has made all reasonable efforts to ensure the information provided is accurate.