Daimler South East Asia Pte Ltd v Front Row Investment Holdings (Singapore) Pte Ltd

• Jurisdiction: Singapore
• Judgment Date: 31 July 2012
• Date: 31 July 2012
• Docket Number: Originating Summons No 312 of 2012 (Summons No 1927 of 2012)
• Court: High Court (Singapore)

Daimler South East Asia Pte Ltd

Plaintiff

and

Front Row Investment Holdings (Singapore) Pte Ltd

Defendant

[2012] SGHC 157

Woo Bih Li J

Originating Summons No 312 of 2012 (Summons No 1927 of 2012)

High Court

Arbitration—Award—Recourse against award—Appeal under Arbitration Act (Cap 10, 2002 Rev Ed)—Whether agreement to submit any dispute to arbitration in accordance with International Chamber of Commerce Rules of Arbitration excluded right of appeal to High Court under s 49 (1) Arbitration Act (Cap 10, 2002 Rev Ed)—Section 49 (1) Arbitration Act (Cap 10, 2002 Rev Ed)

Pursuant to a joint venture agreement (‘JVA’), the plaintiff (‘DSEA’) and the defendant (‘FR’) agreed that all related disputes ‘shall be finally settled under the Rules of Arbitration of the International Chamber of Commerce. This was a reference to the International Chamber of Commerce (‘ICC’) Rules of Arbitration in force as from 1 January 1998 (‘the ICC Rules 1998’). The specific legal question before the High Court was whether the adoption of the ICC Rules 1998 excluded the parties' right to appeal under s 49 (1) of the Arbitration Act (Cap 10, 2002 Rev Ed) (‘the AA’).

The question arose in the context of DSEA's claim against FR for payment of an employee's salary and FR's counterclaim for contractual breach and misrepresentation. By an arbitration award dated 3 July 2009 (‘the 1 st Award’), both DSEA's claim and FR's counterclaim were dismissed. Following an originating summons filed by FR, the High Court set aside the findings in the 1 st Award in respect of FR's counterclaim and directed the part set aside to be tried afresh before a newly appointed arbitrator. This resulted in fresh arbitration proceedings (‘the 2 nd Arbitration’) which raised the issue of whether FR was precluded from pleading its claim for contractual breach in the 2 nd Arbitration by reason of the 1 st Award and the subsequent setting aside proceedings.

By a partial award issued on 29 February 2012 (‘the Partial Award’), the new arbitrator decided that FR was not so precluded. Dissatisfied with this decision, DSEA filed Originating Summons No 312 of 2012 (‘the OS’) to seek leave of the High Court to appeal against the Partial Award. In response, FR filed Summons No 1927 of 2012 to set aside the OS, arguing that the parties had agreed to exclude their right of appeal under s 49 (1) of the AA when they agreed to submit their disputes to arbitration under the ICC Rules. The High Court agreed with FR and struck out the OS with costs.

Held, allowing SUM 1927/2012 in the defendant's favour and striking out OS 312/2012:

(1) It was undisputed that parties could exclude their right of appeal by, eg,adopting without specific reservation institutional rules which excluded an appeal to court. On the facts, parties had agreed to exclude the right of appeal under s 49 (1) of the AA by adopting the ICC Rules 1998: at [15] and [19].

(2) Article 28 (6) of the ICC Rules 1998 provided that parties were deemed to have waived their right to any form of recourse against the award. Its clear purpose was to widen the scope of its predecessor Article 24, which referred to ‘appeal’ instead of ‘recourse’: at [16], [17] and [19].

American Diagnostica Inc v Gradipore Ltd (1998) 44 NSWLR 312 (refd)

Holland Leedon Pte Ltd v Metalform Asia Pte Ltd [2011] 1 SLR 517 (refd)

Lesotho Highlands Development Authority v Impregilo Sp A [2006] 1 AC 221 (refd)

Arbitration Act (Cap 10, 2002 Rev Ed) ss 49 (1) , 49 (2) (consd) ;ss 45, 49

Arbitration Act 1996 (c 23) (UK) s 69 (1)

Jimmy Yim SC and Mahesh Rai (Drew & Napier LLC) for the plaintiff

Chong Yee Leong, Michelle Chiam and Ng Si Ming (Rajah & Tann LLP) for the defendant.

Woo Bih Li J

Introduction

1 The issue between the parties was whether they had agreed to exclude the right of appeal to the High Court under s 49 (1) of the Arbitration Act (Cap 10, 2002 Rev Ed) (‘the AA’) when they agreed to submit any dispute under a joint venture agreement to arbitration to be conducted under the Rules of Arbitration of the International Chamber of Commerce (‘the ICC’). It was common ground that under s 49 (2) of the AA, the parties could exclude the right of appeal under s 49 (1) of the AA and that the reference to the ICC rules was to the ICC Rules of Arbitration in force as from 1 January 1998. I will refer to such rules as ‘the ICC Rules 1998’ for convenience.

2 After hearing arguments, I made a declaration that the parties had excluded the right of appeal. As I was informed that this was the first time that the High Court had decided the point, I set out my reasons below.

Background

3 On 15 September 2005, the parties had entered into a joint venture agreement in which they agreed ‘to work together in order to carry on the business of AMG...