Gateway Land Pte Ltd v Turner (East Asia) Pte Ltd

• Jurisdiction: Singapore
• Judge: T S Sinnathuray J
• Judgment Date: 30 December 1987
• Neutral Citation: [1987] SGHC 54
• Docket Number: Originating Summons No 1046 of
• Date: 30 December 1987
• Year: 1987
• Published date: 19 September 2003
• Plaintiff Counsel: Harry Elias, Pauline Tan and Dr Kyin Swi (Kyin Surin & Co)
• Citation: [1987] SGHC 54
• Defendant Counsel: Wong Meng Meng (Shook Lin & Bok)
• Court: High Court (Singapore)
• Subject Matter: Security,Costs,Merits of application,Civil Procedure,Arbitration proceedings,s 388(1) Companies Act (Cap 50)

Cur Adv Vult

In this originating summons the applicants, Gateway Land Pte Ltd, seek against the respondents, Turner (East Asia) Pte Ltd, the following orders:

(a) That the respondents, Turner (East Asia) Pte Ltd, within 14 days from the date of the order to be made hereon provide security for the applicants` costs of a pending arbitration between the applicants and the respondents in the sum of $500,000.00 or such other sum as this honourable court deems fit.

(b) That in the meantime all further proceedings in the said arbitration, other than the proceedings relating to the giving of such security for costs, be stayed.

(c) That the costs of this application be paid by the respondents to the applicants.

The application is made under s 388(1) of the Companies Act (Cap 50) which provides as follows:

Where a corporation is plaintiff in any action or other legal proceeding the court having jurisdiction in the matter may, if it appears by credible testimony that there is reason to believe that the company will be unable to pay the costs of the defendant if successful in his defence, require sufficient security to be given for those costs and stay all proceedings until the security is given.

There is a dispute between the applicants, the owner of a building project known as `the Gateway Project`, and the respondents, the main contractors for the project. The main contract is a lump sum contract for $221m. Under the terms of the contract, the parties have referred the dispute to arbitration and a three-member arbitration panel has been agreed upon by them. The points of claim, points of defence/counterclaim and points of reply have already been filed. At the time of the hearing of this application, the proceedings were at the stage where the parties were obtaining directions.

The issues for determination in the arbitration proceedings are complex. On the facts, there are complicated, technical, engineering, soil and construction issues. On the legal side, questions arise concerning construction of documents, repudiation and fundamental breach. Having regard to the cessation of the project and the specified sum in the contract, the issue of damages will be of a very considerable sum.

It is anticipated by the parties that there will be a lengthy arbitration. The arbitration hearing itself will take between three to six months, involving as it would expert witnesses, both local and from abroad. The applicants put a...