Mediation and Appropriate Dispute Resolution

AuthorNadja ALEXANDER1 BA, LLB (Hons) (Qld), Dip International Studies (Vienna), LLM D Jur (summa cum laude) (Tübingen); Professor, Yong Pung How School of Law, Singapore Management University; Director, Singapore International Dispute Resolution Academy; Mediator, Singapore International Mediation Centre (SIMI certified). Shouyu CHONG LLM (National University of Singapore); Research Fellow, Singapore International Dispute Resolution Academy, Singapore Management University; Visiting Lecturer and PhD Research Student, Centre of Construction Law & Dispute Resolution, The Dickson Poon School of Law, King's College London.
Publication year2021
Date01 December 2021
I. Introduction

23.1 In 2021, there are a number of interesting cases to report. In this review, arbitration will not be dealt with unless it forms part of a mixed mode dispute resolution process, which has mediation as an element.2 Negotiated settlement agreements will be considered on the same level as mediated settlement agreements, bearing in mind the observation by Andrew Phang Boon Leong JA in the Court of Appeal that “parties’ negotiations with a view to a settlement also happen on platforms that ‘effectively [take] the place of a mediation’”.3

23.2 It bears note that the body of decided cases on subject matter related to mediation and appropriate dispute resolution (“ADR”) in Singapore is expanding and evolving. Therefore, the authors reiterate that the categories of cases in this review may develop and vary year to year. For the 2021 Ann Rev, the authors offer a review of cases in four categories.

23.3 First, the authors will examine one noteworthy case from the General Division of the High Court (“High Court (General Division)”), which granted a claimant a stay of court proceedings pursuant to s 8 of the Mediation Act 2017,4 enforcing a hybrid mediation-arbitration agreement. Secondly, four noteworthy cases on the enforcement of negotiated and/or (mediated) settlement agreements will be examined (including one which resolves a trade mark dispute between parties extraterritorially), with an additional focus on the reliance of dispute resolution clauses encapsulated in such settlement agreements by third parties. Thirdly, two cases which address issues in mediation and ADR practice and ethics will be reviewed: this includes one judgment from the Court of Appeal, sternly reprimanding counsel for not informing the court that a settlement agreement compromising the dispute on appeal was concluded and for not filing for the necessary orders (for example, a stay of proceedings, a withdrawal of proceedings, a discontinuance, or whichever relevant order which has been embodied in the compromise) in good time. Finally, one case dealing with disputes over the confidentiality of settlement agreement terms will be considered.

23.4 Some of these cases may be examined in other chapters of this Ann Rev as they may deal with legal issues beyond mediation. In this chapter, the focus is on mediation- and ADR-related issues only.


Focus of review comments


Enforcement of mediation clauses and mediation agreements

Stay of proceedings pursuant to s 8 of the Mediation Act 2017

EXXA Network Pte Ltd v SQ2 Fintech Pte Ltd5

Recognition and enforcement of (mediated) settlement agreements

Enforcing (mediated) settlement agreements

Digi International Inc v Teraoka Seiko Co, Ltd6 Ye Huishi Rachel v Ng Ke Ming Jerry7 UJM v UJL8

Dispute resolution clauses in (mediated) settlement agreements


Mediation, ADR practice and ethics

Duty to inform court that settlement agreement was reached before trial

Tan Ng Kuang Nicky v Metax Eco Solutions Pte Ltd10

Solicitor's negligence when negotiating compromise agreement over e-mail

Gomez, Kevin Bennett v Bird & Bird ATMD LLP11

Mediation, ADR and civil procedure

Confidentiality of variations to settlement agreement terms

Engineering Centre of Industrial Constructions and Concrete v EFE (SEA) Pte Ltd12

II. Enforcement of mediation clauses and mediation agreements

23.5 The enforcement of dispute resolution clauses in commercial disputes, especially provisions to proceed to ADR forums before litigation or arbitration, is normally an issue of procedural importance. Recently in Haribo Asia Pacific Pte Ltd v Aquarius Corp,13 Lee Seiu Kin J observed in obiter that provisions which oblige parties to attempt mediating their disputes before commencing either arbitration or litigation are “relatively commonplace given the general shift towards cheaper, non-adversarial means of dispute resolution”.14 Here, the parties in dispute were a Singapore incorporated company (in the business of manufacturing and selling confectionaries) and a South Korea incorporated company (in the business of distributing food and beverage products in South Korea). In a distribution agreement, they had agreed to adhere to the following

ADR provisions before they could commence litigation proceedings in the Singapore High Court:15

§ 8 Miscellaneous Provisions

8.7 If any dispute arises out of or in connection with this Agreement, the respective rights and obligations hereunder and/or the relationship between the parties in general, which cannot be settled by the day-to-day management team of the parties, the following individuals shall communicate in a good faith effort to resolve the dispute and shall be deemed to have the authority to settle the dispute on behalf of the parties within ten (10) days of a written request from one party to the other:-

8.7.1 on behalf of the Distributor: Eric Hahn and/or any President of the Distributor (whose identity and contact details shall be provided to the Distributor within one (1) week after his/her appointment); and

8.7.2 on behalf of the Principal: Martin Schlatter (or his successor in role).

If the dispute is not wholly resolved within thirty (30) days of the written request, or within such further period as the parties may mutually agree in writing, the dispute may be submitted to the Singapore High Court. In this regard, the parties herein submit to the exclusive jurisdiction of the High Court of Singapore.

23.6 It is noteworthy that the provisions above were governed by German law.16 The disputing parties had engaged experts on German law who interpreted these provisions differently.17 The experts could not agree over whether the dispute resolution clause was a provision which set out what parties should do in the event of termination or impending litigation under German law. Lee J preferred reading the clause as a litigation avoidance mechanism rather than termination avoidance:18

This, in my view, is a more coherent reading of the clause as a whole. The first half of cl 8.7 … empowers and obliges specified individuals to communicate in good faith to resolve disputes which cannot be settled by the parties' day-to-day management teams. The second half then states that if such disputes cannot be resolved within 30 days (or such other period as the parties agree in writing), their dispute may then be submitted to the Singapore High Court. [emphasis in original]

23.7 The common law will broadly be accommodating with the enforcement of adequately drafted mediation or other ADR provisions and agreements to proceed to mediation (referred to in this review as mediation agreements).19 Furthermore, the enforcement of mediation agreements may be made pursuant to s 8 of the Mediation Act, which specifically provides the Singapore courts with powers to enforce mediation agreements. In EXXA Network Pte Ltd v SQ2 Fintech Pte Ltd,20 the High Court (General Division) has recently applied this section to stay court proceedings in favour of mediation, enforcing a hybrid mediation-arbitration agreement. This case will be discussed in this part.

A. Stay of proceedings pursuant to section 8 of the Mediation Act

23.8 In EXXA Network Pte Ltd v SQ2 Fintech Pte Ltd, the disputants had concluded two related agreements in chronological order:

(a) a quotation agreement which sets out the framework for the development of some fintech applications, called the Superwallet Platform and DEVO+, and does not contain any jurisdiction or dispute resolution agreement;21

(b) a subsequent “Founders Shareholders' Agreement” which refers to the above-mentioned quotation agreement but sets out in greater detail what the parties have undertaken to do, and contains a multi-tiered dispute resolution provision.22

23.9 A dispute arose when the defendant, SQ2 Fintech Pte Ltd, could no longer support the plaintiff, EXXA Network Pte Ltd, on the development of DEVO+.23 The plaintiff therefore filed a claim against the defendant in court. After a brief procedural detour, the plaintiff obtained leave of court to continue its suit against the defendant, to which the defendant responded by applying for a stay of court proceedings relying on the multi-tiered dispute resolution provision in the Founders Shareholders' Agreement. Reproduced, the dispute resolution clause provides:24

25.1 If any dispute or difference arises between any of the Parties hereto during the subsistence of this Agreement or thereafter, in connection with the validity, interpretation, implementation or alleged breach of any provision of

the Agreement or regarding any question, including the question as to whether the termination of the Agreement by any Party hereto has been legitimate, the Parties hereto shall endeavour to settle such dispute amicably. The attempt to bring about an amicable settlement is considered to have failed as soon as one of the Parties hereto, after reasonable attempts, which attempt shall continue for not less than thirty (30) days, gives a written notice thereof to the other Party in writing.

25.2 The Parties shall agree that all disputes, controversies or differences (‘Disputes’) arising out of or in connection with this Agreement, including any questions regarding its existence, validity or termination, shall first be referred to mediation to the Singapore International Mediation Centre (‘SIMC’) in Singapore, in accordance with the SIMC rules and proceedings for the time being in force.

25.3 In the event that the Disputes cannot be resolved in mediation within the time agreed by the Parties, each Shareholder may, at its option, refer and resolve the Disputes by arbitration in Singapore in accordance with the Arbitration Rules of the Singapore International Arbitration Centre (‘SIAC Rules’) for the time being in force, which rules are deemed to be incorporated by...

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