Coal & Oil Co LLC v GHCL Ltd
Jurisdiction | Singapore |
Judge | Steven Chong J |
Judgment Date | 12 March 2015 |
Neutral Citation | [2015] SGHC 65 |
Docket Number | Originating Summons No 538 of 2014 |
Date | 12 March 2015 |
Published date | 16 March 2015 |
Plaintiff Counsel | Gabriel Peter and Chong En Lai (Gabriel Law Corporation) |
Hearing Date | 20 January 2015 |
Defendant Counsel | Joseph Lopez, Khushboo Hashu Shahdadpuri and Chong Li Tang (Joseph Lopez LLP) |
Court | High Court (Singapore) |
Subject Matter | Award,Setting aside,Recourse against award,Arbitration |
In the last few decades, international arbitration has emerged as an attractive and, in certain industries, the preferred form of dispute resolution. Parties opt for arbitration for various tactical, strategic, and commercial reasons including the flexibility to select the tribunal who, in their assessment, is best suited to preside over the dispute bearing in mind the complexity of the case. Finality of the arbitral award is also perceived as a significant advantage though it would be fair to say that the perception is viewed less advantageously, after the fact, by the losing party. Curial intervention is therefore available only in limited circumstances, including instances where there has been a breach of natural justice, where the award is tainted by fraud or corruption, or where the award has been made
I have observed a clear trend, in recent times, of parties seeking to set aside adverse arbitral awards on the basis of alleged breaches of natural justice. Many have failed. It is perhaps opportune for me to state that an accusation against a tribunal for committing a breach of natural justice is a serious matter. The tribunal is not able to defend itself and the accusation can have an adverse impact on the arbitrator’s reputation and standing in the arbitration community. The courts take a serious view of such challenges and that is why those which have succeeded are few and far between and limited only to egregious cases where the error is “clear on the face of the record” (see
Parties have nonetheless been creative (though ultimately unsuccessful) in attempting to expand the defined boundaries of the doctrine of breach of natural justice. Some notable examples include an assertion that the tribunal’s decision to close the arbitral proceedings and subsequent refusal to reopen them upon request was a breach of the right to a fair hearing (
The present case represents another novel attempt to set aside an arbitral award. In brief, the plaintiff’s argument is two-fold. First, the plaintiff argues that the Tribunal had breached its
Two general issues arise from these facts. The first is the proper construction of r 27.1; the second is the applicable time limit, if any, for the release of arbitral awards.
Background factsThe plaintiff, Coal & Oil Company LLC (“C&O”), is a company registered in Dubai, United Arab Emirates.1 It is engaged in the business of trading coal.
The defendant, GHCL Limited (“GHCL”), is a company registered in the Republic of India. It was, at the material time, a customer of the plaintiff.2
The facts are not in dispute and lie within a narrow compass. On 26 April 2007, the plaintiff signed an agreement to supply between 180,000 and 190,000 Metric Tons (“MT”) of coal to the defendant (“the Agreement”).3 It was agreed that the coal would be delivered in three to four shipments. Clause 16 of the Agreement provided that any disputes would be submitted to arbitration in Singapore.4 The plaintiff separately contracted with Noble Resources Pte Ltd (“Noble”) to obtain some of the coal it required to fulfil the terms of its contract with the defendant (“the Noble Contract”).5
Between April 2007 and January 2008, the price of coal rose dramatically and Noble attempted to re-negotiate the price of coal under the Noble Contract. The plaintiff initially resisted this increase as it would affect the profitability of its contract with the defendant but Noble was insistent that the price be increased. This triggered an exchange of correspondence between the plaintiff and the defendant during which the defendant was informed that the plaintiff would not deliver the third shipment (consisting of 70,000 MT of coal) unless a price increase was agreed.6 By way of an addendum dated 17 March 2008, the defendant agreed to a price increase of US$18.50 per MT for the third shipment (“the Addendum”).7 The third shipment was loaded and paid for on 25 April 2008.8 However, on 18 May 2008, the defendant demanded that the plaintiff repay a sum of US$1,295,888 (the additional sum paid under the Addendum), arguing that the Addendum was illegal as it had been procured through coercion.9
The plaintiff refused to repay the demanded sum and, pursuant to clause 16 of the Agreement, the defendant submitted the dispute to arbitration in Singapore.10 The parties agreed, from the outset, that the arbitration would be governed by the 2007 SIAC Rules.11 A sole arbitrator (“the Tribunal”) was appointed by the Singapore International Arbitration Centre (“the SIAC”).
The following is a brief chronology of the arbitration:12
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In its Final Award dated 14 March 2014 (“the Award”), the Tribunal found in favour of the defendant and held that the Addendum was vitiated by duress and ought to be side aside. The Tribunal awarded the defendant the sum of $1,295,888 with interest.13 The parties received the Award on 17 March 2014, one year and seven months after they made their final reply submissions (on 17 August 2012).
The plaintiff’s application On 12 June 2014, the plaintiff filed Originating Summons No 538 of 2014 (“OS 538/2014”), applying under s 24 of the International Arbitration Act (Cap 143A, 2002 Rev Ed) (“IAA”) to set aside the Award on the following grounds:14
The plaintiff also prayed, in the alternative, for a declaration under Art 14(1) of the Model Law that the Tribunal’s mandate had been terminated prior to 14 March 2014 (the date of the issuance of the Award) by reason of the Tribunal’s failure to act without undue delay in declaring the proceedings closed and that, therefore, the Award should be set aside for want of jurisdiction.15 As the application to terminate the mandate of the arbitrator was filed out of time, the plaintiff also sought an extension of time in aid of that specific ground of the application.16
At the hearing on 20 January 2015, Mr Peter Gabriel (“Mr Gabriel”), counsel for the plaintiff, informed me that the plaintiff would not be proceeding with the alternative prayer.17 I should add that if the plaintiff had pursued the alternative prayer, I would not have been minded to grant the extension of time. Order 69A r 2(3) of the Rules of Court (Cap 322, R5, 2014 Rev Ed) (“ROC”) stipulates that any application to decide on the termination of the tribunal’s mandate must be made “within 30 days from the date of receipt by the applicant… of the arbitral tribunal’s decision or ruling.” Given that the plaintiff had received the Award on 17 March 2014, the application ought to have been filed by 16 April 2014. The plaintiff was thus 57 days late in filing the application on 12 June 2014. No convincing reasons for the delay were put forward apart from the need to “study the purported Final Award”, “seek legal advice”, and instruct new solicitors.18 However, I note that the plaintiff was represented by their previous solicitors, M/s Rajah & Tann LLP, at least until 2 May 2014, which is well
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