Commentary

• Citation: (2017) 29 SAcLJ 574
• Date: 01 December 2017
• Published date: 01 December 2017

ON APPEAL FROM SINGAPORE INTERNATIONAL COMMERCIAL COURT

On 12 May 2017, the Singapore Court of Appeal heard and rendered its first decision in relation to an appeal from a decision of the Singapore International Commercial Court (“SICC”). The Court of Appeal's written decision was subsequently reported as Jacob Agam v BNP Paribas SA (“Jacob Agam”). This article sets out highlights relating to the management and determination of the Jacob Agam appeal. It also discusses the attractiveness of appeal mechanisms in the resolution of international commercial disputes, and takes a closer look at the appellate mechanism in SICC, drawing illustrations from the Jacob Agam appeal.

I. Introduction

1 The Singapore International Commercial Court (“SICC”) was launched in January 2015. It was a dispute resolution mechanism specially designed to offer a world-class facility for resolving international commercial disputes through litigation.1 Positioned alongside the Singapore International Arbitration Centre and the Singapore International Mediation Centre, the establishment of SICC is aimed at providing an entire suite of dispute resolution services for users

to choose from, and is an important part of Singapore's aim to be a leading international dispute resolution hub in Asia.2

2 Following the launch of SICC, there was widespread interest in comparing what SICC offered with what was available in international commercial arbitration. Many of these differences have been highlighted and discussed elsewhere.3 This article focuses on one of the key differences, viz, the availability of an appellate mechanism in SICC.

3 On 12 May 2017, the Singapore Court of Appeal heard and rendered its first decision in relation to an appeal from the decision of SICC.4 Shortly thereafter, the Court of Appeal furnished detailed grounds in its written decision reported as Jacob Agam v BNP Paribas SA5 (“Jacob Agam”).

4 This article first provides an overview of the Jacob Agam appeal. It, thereafter, discusses the attractiveness of appeal mechanisms in international commercial dispute resolution systems, and takes a closer

look at the framework for appeals from SICC, drawing illustrations from the Jacob Agam appeal where appropriate.

II. The Jacob Agam appeal

5 The appellants in the Jacob Agam appeal were Jacob and Ruth Agam. They were Israeli nationals who owned, through several companies, a number of properties in France and Monaco.6 The respondent was BNP Paribas SA, which was the parent company of BNP Paribas Wealth Management (“Wealth Management”), a bank incorporated in France.7

6 In November 2015, Wealth Management commenced an action in the Singapore High Court, claiming about €30m from the appellants as guarantors of the obligations of two of the appellants' companies. The action was transferred from the High Court to SICC in April 2016.

7 By virtue of a merger effected by a written merger agreement under the French Commercial Code, the respondent succeeded to the assets and liabilities of Wealth Management.8 The written merger agreement was in French, and provided, inter alia, (in translation) that the respondent “shall be generally subrogated purely and simply on the Closing Date in all the rights, legal actions, obligations and miscellaneous commitments of Wealth Management”.9

8 On 27 October 2016, the respondent applied to be substituted for Wealth Management in the action.10 The matter was heard in SICC at first instance by a coram comprising Steven Chong J (as he then was)11 and International Judges12 Roger Giles13 and Dominique Hascher.14 On 17 February 2017, the first instance court allowed the substitution sought, for reasons published in BNP Paribas Wealth Management v Jacob Agam15 (“Jacob Agam (First Instance)”).

9 The appellants, thereafter, took out an application to the first instance court, praying for a declaration that the leave of court was not required for an appeal against the entire decision in Jacob Agam (First Instance). In the alternative, they prayed for leave to appeal against the decision.

10 The application was heard by Chong JA on 5 April 2017.16 As a preliminary issue, Chong JA directed the appellants to clarify their position on the requirement for leave.17 If their position was that leave was not required, they should proceed directly with the appeal; the prayer for a declaration would only be entertained if there was “genuine uncertainty” on whether leave was required.18 Alternatively, if their position was that leave was required, the court would hear the prayer for leave.

11 In the circumstances, the appellants elected to proceed on the basis that leave was required. After hearing parties, Chong JA granted leave to appeal against Jacob Agam (First Instance), limited to a single issue framed as follows: “[w]hether the Court had erred in its interpretation of Sections 14A to 14C and 55B to 55C of the Banking Act (Cap. 19) in determining that Court approval was not required in the instant case”.19

12 On application by the appellants and with the consent of the respondent, Chong JA ordered that the appeal be expedited. Allowing the appeal to proceed on the usual appeal timelines would mean that the trial, which had been fixed in August 2017,20 would have to be vacated simply to determine the issue of substitution of the respondent. This would have unnecessarily delayed the resolution of the matter.

13 The appellants filed the notice of appeal to the Court of Appeal on 12 April 2017. In view that this was an expedited appeal, the Court of Appeal convened a case management conference later the same day, conducted by one of the members of the appeal coram, Judith Prakash JA. The conference was attended by lead counsel on both sides. At the conference, Prakash JA gave directions for an expedited process that departed from the usual filing requirements and timelines for

appeals prescribed by the Rules of Court21 (“RoC”). Amongst other things, Prakash JA ordered the parties to promptly file and exchange written arguments and an agreed bundle of documents, so as to facilitate the expedited hearing of the appeal.

14 The Registry of the Supreme Court issued a formal written notice to the parties the next day, informing them of the tentative period within which the Court of Appeal would hear the matter, as well as setting out administrative guidelines for the filing of documents that were ordered by Prakash JA.

15 On 12 May 2017, the appeal was heard by a Court of Appeal coram comprising Sundaresh Menon CJ, Prakash JA and International Judge Dyson Heydon.22 The public gallery was filled by members of the legal profession, media23 and the general public.

16 At the hearing, counsel for the appellants raised three main arguments:

(a) First, the appellants contended that the term “subrogated” in the merger agreement should be given its common law meaning, and if so, the respondent had no independent right to sue the appellants, and could only sue in the name of Wealth Management.24 Since Wealth Management no longer existed, there was no legal person with standing to sue the appellants.25 It should be noted that this argument went beyond the issue of law for which leave had been granted, but the appellants claimed that they were entitled to appeal this issue as of right, given that the first instance court's interpretation of “subrogation” was a “decisive” one.26 The Court of Appeal emphasised that the appellants should have given the respondent sufficient notice of this intended approach.27 Be that as it may, the Court of Appeal pragmatically allowed the appellants to proceed on this argument, on the basis that it would be “more economical and efficient” to deal with the “substance of the arguments”, as there would be “little point in

debating the law about whether the appeal did lie as of right if it were clear that even if it did, it ought to be dismissed on the merits”.28

(b) Second, the appellants submitted that s 55B of the Singapore Banking Act29 required Wealth Management to satisfy certain conditions, including obtaining the court's approval, before a transfer of its business could take place. In their view, for policy reasons, the expression “without prejudice” in s 55B(2) of the Banking Act indicated that a bank could not disregard the requirements necessary to complete a transfer.30 Furthermore, the expression “any law” in the same provision should be interpreted to mean “Singaporean law” or “any written law”, so as to ensure that the safeguards afforded by the need for ministerial or court approval could not be circumvented.31

(c) Third, the appellants argued that once Wealth Management had decided not to seek the court's approval under s 55B of the Banking Act, it should have applied to the Minister for approval under s 14A of the Banking Act.32

17 After engaging counsel on the issues for an hour and a half, the Court of Appeal stood down to deliberate the matter. The Court of Appeal delivered its judgment about half an hour later, providing brief oral reasons for dismissing the appeal, and ordering costs (of the appeal and of the leave application before Chong JA) fixed at $24,000 plus disbursements in favour of the respondent. The Court of Appeal also indicated that it would publish detailed written grounds of its decision in due course.

18 The Court of Appeal, subsequently, released its written decision (that is, Jacob Agam) dated 18 May 2017. The decision was, shortly thereafter, made available on the SICC website, together with an accompanying summary.33 The decision was also published on the

Singapore Law Watch website34 (a daily legal news service) and the Singapore Law website35 (a website for updates on Singapore commercial law).

19 The Court of Appeal's reasons in the written decision may be summarised as follows:

(a) First, the word “subrogated” in the merger agreement could not be given its common law meaning where, as was the case in the appeal...