Holland Leedon Pte Ltd (in liquidation) v Metalform Asia Pte Ltd

• Jurisdiction: Singapore
• Judge: Philip Pillai J
• Judgment Date: 17 September 2010
• Neutral Citation: [2010] SGHC 280
• Date: 17 September 2010
• Docket Number: Originating Summons No 1679 of 2007
• Published date: 22 September 2010
• Plaintiff Counsel: Sundaresh Menon SC, Sim Kwan Kiat, Farrah Salam (Rajah & Tann LLP)
• Hearing Date: 26 July 2010
• Defendant Counsel: Chelva Rajah SC, Chew Kei-Jin and Moiz Haider Sithawalla (Tan Rajah & Cheah)
• Court: High Court (Singapore)
• Subject Matter: Arbitration

Philip Pillai J:

This is the plaintiff’s application for leave to appeal against a summary determination of issues (“the Decision”) by the sole arbitrator in the arbitration between the parties in SIAC Arbitration No 069/DA17/05 (“the Arbitration”). The plaintiff, Holland Leedon (“the Vendor”), is the respondent in the Arbitration, while the defendant, Metalform Asia Pte Ltd (“the Purchaser”). The dispute between the parties relate to the interpretation of terms in an agreement between the parties for the sale and purchase of the Vendor’s business (“the SPA”).

Arbitration Act

The relevant statutory provision is s 49 of the Arbitration Act (Cap 10, 2002 Rev Ed) (“the Act”), the material part of which read as follows:

Appeal against award

49. —(1) A party to arbitration proceedings may (upon notice to the other parties and to the arbitral tribunal) appeal to the Court on a question of law arising out of an award made in the proceedings.

(2) Notwithstanding subsection (1), the parties may agree to exclude the jurisdiction of the Court under this section and an agreement to dispense with reasons for the arbitral tribunal’s award shall be treated as an agreement to exclude the jurisdiction of the Court under this section.

(3) An appeal shall not be brought under this section except- (a) with the agreement of all other parties to the proceedings; or (b) with the leave of the Court;

(5) Leave to appeal shall be given only if the Court is satisfied that – (a) the determination of the question will substantially affect the rights or one or more of the parties; (b) the question is one which the arbitral tribunal was asked to determine; (c) on the basis of the findings of fact in the award – (i) the decision of the arbitral tribunal on the question is obviously wrong; or (ii) the question is one of general public importance and the decision of the arbitral tribunal is at least open to serious doubt; and (d) despite the agreement of the parties to resolve the matter by arbitration, it is just and proper in all the circumstances for the Court to determine the question. (6) An application for leave to appeal under this section shall identify the question of law to be determined and state the grounds on which it is alleged that leave to appeal should be granted.

The present application turns on subsections (2), (5) and (6). I will deal with each in turn.

Section 49(2): exclusion of appellate jurisdiction

The Purchaser argued that the parties had agreed to exclude the appellate jurisdiction of the court granted by s 49(1) by virtue of cll 21.2, 21.6 and 21.7 of the SPA, which read as follows: 21.2 In the event that any disagreement, dispute, controversy of claim (the “Dispute”) is not resolved amicably between the parties, then, save as otherwise provided in this Agreement, such Dispute shall be settled exclusively and finally by arbitration. It is specifically understood and agreed that, save as otherwise provided in this Agreement, any Dispute that cannot be resolved between the parties, including any matter relating to the interpretation of this Agreement, shall be submitted to arbitration irrespective of the magnitude thereof and the amount in dispute or whether such Dispute would otherwise be considered justifiable or ripe for resolution by any court. This Agreement and the rights and obligations of the parties under this Agreement shall remain in full force and effect pending the award in such arbitration proceedings, and the award shall determine whether and when the termination of this Agreement, if relevant, shall become effective. 21.6 The [arbitral] Tribunal shall give a reasoned decision or award, including as to the costs of the arbitration, which shall be final and binding on the parties. The parties agree that the Tribunal’s award may be enforced against the parties to the proceedings or their assets, wherever they may be found. 21.7 The parties agree to exclude any right or application to any court or tribunal of competent jurisdiction in connection with questions of law arising in the course of any arbitration.

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