Ling Kong Henry v Tanglin Club

• Jurisdiction: Singapore
• Judge: Valerie Thean J
• Judgment Date: 03 July 2018
• Neutral Citation: [2018] SGHC 153
• Plaintiff Counsel: Bryan Manaf Ghows, Soh Leong Kiat, Anthony and Wan Rui Jie, Erwin (Taylor Vinters Via LLC)
• Docket Number: Originating Summons No 96 of 2018 (Registrar’s Appeal No 99 of 2018)
• Date: 03 July 2018
• Hearing Date: 24 April 2018
• Subject Matter: Scope,Arbitration,Stay of court proceedings,Court's discretion under the Arbitration Act,Agreement
• Year: 2018
• Defendant Counsel: Ramesh Selvaraj and Tseng Zhi Cheng, Sean Douglas (Allen & Gledhill LLP)
• Court: High Court (Singapore)
• Citation: [2018] SGHC 153
• Published date: 25 July 2018

Valerie Thean J: Introduction

The defendant, Tanglin Club (“the Club”), is a social club registered under the Societies Act (Cap 311, 2014 Rev Ed) (“Societies Act”). The plaintiff, Mr Henry Kong Ling (“Mr Ling”), has been a member of the club since 1992.¹

The Club’s Rules make provision for disciplinary action to be taken upon complaint by members. The same Rules also contain a dispute resolution clause dealing with disputes for which no express provision in the Rules has been made. Pursuant to certain complaints in February 2017, the Club took disciplinary proceedings against Mr Ling, which concluded with a written reprimand to him on 31 August 2017. Mr Ling thereafter filed this originating summons on 19 January 2018 for, inter alia, a declaration that the Club had breached the rules of natural justice and fairness in its conduct of the disciplinary proceedings. He also sought various consequential reliefs, including damages for humiliation, embarrassment, mental distress and the deprivation of his rights as a member.

On 2 February 2018, the Club then filed an application for Mr Ling’s claim to be stayed under s 6 of the Arbitration Act (Cap 10, 2002 Rev Ed) (“Arbitration Act”), on the ground that its Rules contain an agreement to arbitrate Mr Ling’s dispute. This application was dismissed by an Assistant Registrar on 28 March 2018. I allowed the Club’s appeal and granted the stay requested on 24 April 2018. Mr Ling has now appealed and I furnish the grounds of my decision.

Background

The Club has a room on its fourth floor which was used by a group of about 30 members (“the Bridge Players”) and their guests for their weekly game of bridge. The General Committee (“GC”), on which Mr Ling served three tenures, from 2013–4, 2014–5, and most recently, 2016–7, took the view that the arrangement was only temporary and repeatedly requested that the Bridge Players vacate the room. They refused to do so.²

In or around February 2017, the Bridge Players requisitioned for a Special General Meeting (“the SGM”), seeking a members’ resolution that the room remain exclusively for card and board games and not be re-designated for other purposes.³ Prior to the SGM, Mr Ling sent several WhatsApp messages and emails to some club members, urging them to vote against the Bridge Players’ resolution.⁴ In those messages and emails, Mr Ling made comments such as: “We cannot allow anarchy to brew and fester on our watch”;⁵ “That is why we must take action now, and take strong stance on violators. Use the club rules to favour and save this club from falling into anarchy”;⁶ “If you do not wish to see our club into anarchy, come to the SGM and vote against their requisition”.⁷

The SGM was held on 15 March 2017, where the Bridge Players failed to secure a majority of votes for their proposed resolution. As a result, they had to vacate the Level 4 Room.⁸

Subsequently, some members wrote emails and letters to the General Manager of the Club to complain that Mr Ling’s messages were “shockingly disrespectful”, “unkind”, “insulting” and in “very bad taste”. Particular objection was taken against Mr Ling’s use of the word “anarchy” when referring to the conduct of the Bridge Players.⁹

In accordance with Rule 26 of the Club’s Rules, the complaints were considered by the General Manager who prepared a report (“the GM Report”) for the Membership and Rules Sub-Committee (“MRSC”), which recommended that an Inquiry Sub-Committee (“ISC”) be convened.¹⁰ Subsequently after consideration of a report prepared by the ISC, the GC issued a letter of reprimand to Mr Ling on 31 August 2017. The letter stated that, while there was a breach of the Rules by sending offensive and disrespectful emails and messages, it was determined that such behaviour did not constitute a serious breach, and no further disciplinary action was to be taken.¹¹

Legal context, arguments and issues

The Club premised its stay application on s 6 of the Arbitration Act, which reads:

Stay of legal proceedings

6.—(1) Where any party to an arbitration agreement institutes any proceedings in any court against any other party to the agreement in respect of any matter which is the subject of the agreement, any party to the agreement may, at any time after appearance and before delivering any pleading or taking any other step in the proceedings, apply to that court to stay the proceedings so far as the proceedings relate to that matter. (2) The court to which an application has been made in accordance with subsection (1) may, if the court is satisfied that — (a) there is no sufficient reason why the matter should not be referred in accordance with the arbitration agreement; and (b) the applicant was, at the time when the proceedings were commenced, and still remains, ready and willing to do all things necessary to the proper conduct of the arbitration,

make an order, upon such terms as the court thinks fit, staying the proceedings so far as the proceedings relate to that matter.

…

Sections 6(1) and (2) of the Arbitration Act set out the following requirements for a stay to be ordered: The subject matter of the court proceedings must be the subject of the arbitration agreement; The party seeking the stay must not have delivered any pleading or taken any step in the proceedings; There are no sufficient reasons why court proceedings should not be stayed; and The party seeking the stay must be ready and willing to do all things necessary to the proper conduct of the arbitration.

The arbitration clause that lies at the heart of this application, Rule 45B, is reproduced at [16] below. In the present case, (b) and (d) were not in dispute. In relation to (a), the plaintiff premised his case on the words “for which express provision has not been made in these Rules” found in Rule 45B(i). Mr Ling submitted that since disciplinary proceedings under Rule 26 have been convened against him , Rule 45B would not be applicable because the latter “clearly excludes its own operation if proceedings under other rules have been invoked”. Mr Ling argued, therefore, that his claim did not fall within the scope of the arbitration clause (ie, Rule 45B). Furthermore, Rule 45B contains neither an appellate or review process for issues arising for disciplinary proceedings commenced under Rule 26.¹² . As for the requirement set out in (c), the plaintiff submitted that the court should refuse a stay to “ensure the observance of the due process of law and procedural fairness”. He alleged that the disciplinary proceedings were instituted against him for “political” reasons, and had caused him “embarrassment, humiliation, pain and suffering”.¹³ It was also contended that as a matter of public policy, only the courts may determine issues arising from breaches of the rules of natural justice.¹⁴ Counsel clarified at the hearing that it was not Mr Ling’s case that the dispute was not arbitrable. Instead, this argument went towards justifying his submission that the court should exercise its discretion to refuse a stay.

The Club, on the other hand, submitted that the scope of the dispute resolution provision is broad and covers both matters addressed and not yet addressed by the Rules. It could not be correct that Rule 45B only covers matters not addressed by the Rules, because that interpretation would render the phrase “any matter dealt with in the Rules” in Rule 45B otiose. Furthermore, it would make little sense for Rule 45B(i) to exclude matters concerning disciplinary proceeding because many disputes involving social clubs revolve around the conduct of such proceedings. Additionally, the Club submitted that Mr Ling’s grievances cannot be dealt with under Rule 26 because disciplinary proceedings have already been concluded. Therefore, even if Mr Ling were correct that Rule 45B(i) only covers matters which are not addressed by any other Rule, the dispute would still fall under Rule 45B, there being no other Rule through which Mr Ling may be granted the remedies which he sought.¹⁵ As for whether the court should otherwise refuse a stay, the Club emphasised that the court would only so refuse in exceptional cases. These circumstances did not exist because Mr Ling was contractually obliged to follow the procedure established in Rule 45B. Rule 45B is capable of being performed, notwithstanding any procedural irregularities.¹⁶

At first instance, the Assistant Registrar agreed with Mr Ling that Rule 45B was not engaged where a dispute arises over the conduct of disciplinary proceedings under Rule 26. He dismissed the Club’s application.

On appeal, the following issues arose for consideration: Is there an agreement to arbitrate within the meaning of s 6 of the Arbitration Act? If so, does the dispute at hand engage the agreement to arbitrate? And, if s 6 of the Arbitration Act applies, are there sufficient reasons for refusing a stay of court proceedings?

For reasons that I explain below, I was satisfied that Rule 45B is an agreement to arbitrate and that the dispute in the present case engages Rule 45B. As there was no reason to exercise my discretion to refuse a stay against the procedures set out in Rule 45B, I granted a stay pursuant to s 6 of the Arbitration Act.

Is Rule 45B an agreement to arbitrate?

The Rules form a contractual basis for the relationship between the Club and its members. As made clear by Kay Swee Pin v Singapore Island Country Club [2008] 2 SLR(R) 802 at [2], “[t]he legal relationship between any club and its members lies in contract, and the rights of members are determined by the terms of the contract, which are found in the constitution or the rules of the club”. In this connection, Rule 45B provides: 45B(i) Where a dispute or question arises between the Club and a member or between a member and a member (hereinafter referred to as “the Parties”) touching on any matter dealt...