National Oilwell Varco Norway AS (formerly known as Hydralift AS) v Keppel FELS Ltd (formerly known as Far East Levingston Shipbuilding Ltd)
Jurisdiction | Singapore |
Judge | Sundaresh Menon CJ |
Judgment Date | 16 March 2022 |
Neutral Citation | [2022] SGCA 24 |
Court | Court of Appeal (Singapore) |
Docket Number | Civil Appeal No 188 of 2020 |
Published date | 18 March 2022 |
Year | 2022 |
Hearing Date | 24 November 2021 |
Plaintiff Counsel | Poon Kin Mun Kelvin, Lee Eng Beng SC, Seow Hwang Seng John, Aleksandar Anatoliev Georgiev and Kristin Ng Wei Ting (Rajah & Tann Singapore LLP) |
Defendant Counsel | Lin Weiqi Wendy, Goh Wei Wei, Ling Jia Yu and Pranay Arvind Suryavanshi (WongPartnership LLP) |
Subject Matter | Arbitration,Enforcement,Setting aside leave to enforce,Misnomer |
Citation | [2022] SGCA 24 |
The enforcement of arbitral awards in Singapore is provided for in s 19 of the International Arbitration Act (Cap 143A, 2002 Rev Ed) (“IAA”) which empowers the court to enforce an award “in the same manner as a judgment or an order
The process that is entailed in this regard has been described as being mechanical in nature in at least two senses. First, as recognised in
… the award cannot be enforced on
terms not specified in the award . … In particular, an awardcan only be enforced against a losing party in the arbitration . The party successful in the arbitration is not, therefore, entitled to seek enforcement of the award against another person who is alleged in the enforcement proceedings to be the principal of the losing party in the arbitration. … [emphasis added in italics]
In the present case, the appellant, National Oilwell Varco Norway AS (“NOV Norway”), seeks to enforce a final award dated 4 September 2019 (the “Award”), which was issued not in its name, but in the name of a company that no longer exists, A/S Hydralift (“Hydralift”). Following two mergers as part of a corporate restructuring exercise, NOV Norway assumed all the assets, rights, obligations, and liabilities of Hydralift. When the respondent, Keppel FELS Ltd (“KFELS”), commenced an arbitration against Hydralift, NOV Norway appeared, defended the claim and succeeded in its counterclaim in the arbitration. NOV Norway did all this purporting to be Hydralift and it never disclosed the fact that the mergers had occurred or that Hydralift no longer existed.
In HC/OS 1543/2019 (“OS 1543”), NOV Norway made an
CA/CA 188/2020 (“CA 188”) is NOV Norway’s appeal against the Judge’s decision. Its case is that the use of the name Hydralift represents nothing more than a misnomer (meaning an inconsequential mistake as to its name) and that in fact and in substance the Award was made in NOV Norway’s favour and it is therefore entitled to enforce the Award. The respondent, on the other hand, contends that the appellant cannot enforce the Award because it was issued in favour of a different and non-existent entity, Hydralift. It contends that any order enforcing the Award would be contrary to the arbitral tribunal’s intention to issue the Award in favour of Hydralift and not NOV Norway.
We heard the parties on 24 November 2021 and reserved judgment. Having considered the matter, we conclude that the Judge erred in not appreciating that the effect of the mergers under Norwegian law is that NOV Norway, is for all intents and purposes, the same legal entity as Hydralift. This is a situation of a true misnomer. As we explain below, the court in such circumstances has the power to, and should, enforce the Award. We therefore allow CA 188.
FactsThe material facts are set out comprehensively in the GD (at [6]–[14]). It suffices for us to highlight only the salient facts.
On 7 May 1996, KFELS (then known as Far East Levingston Shipbuilding Ltd) and Hydralift entered into a contract for the design and supply of a turret bearing system and a turret turning and locking system (the Contract”). Hydralift is a company incorporated in Norway while KFELS is a company incorporated in Singapore. The Contract is governed by Singapore law and contains an agreement for disputes to be resolved by arbitration in Singapore.
A dispute under the Contract arose between KFELS and Hydralift in 1999 in relation to certain alleged defects in the works by Hydralift and the parties tried in vain to resolve this until sometime in 2007. KFELS commenced the arbitration against Hydralift on 27 June 2007, seeking the equivalent of $5.5m in damages for breach of contract.
However, by this time, Hydralift was no longer in existence. In 2002, it became a wholly owned subsidiary of a Norwegian company called National Oilwell-Hydralift AS (“NOH”). On 6 October 2004, it merged with NOH and was struck off the Norwegian register of companies. Then, on 15 October 2004, NOH merged with National Oilwell Norway AS (which is the predecessor of NOV Norway), a company incorporated in Norway. We refer to the two mergers hereafter as the “2004 mergers”. In 2010, National Oilwell Norway AS changed its name to NOV Norway.
NOV Norway, in the name of Hydralift, defended the claim and mounted a counterclaim for the equivalent of $1.2m in damages against KFELS for alleged breach of contract.
KFELS knew that Hydralift had been acquired around 2002 but it denies knowledge of the 2004 mergers or the fact that Hydralift ceased to exist as a result of the merger. It claims that it only learnt in 2019 that Hydralift ceased to exist. NOV Norway for its part accepts that it did not disclose to KFELS that Hydralift had ceased to exist, but maintains that KFELS must have been aware of the mergers.
An arbitral tribunal was constituted in 2008 (the “Tribunal”). In 2015, KFELS filed three originating summonses (HC/OS 168/2015 (“OS 168”), HC/OS 223/2015, and HC/OS 680/2015) in the High Court to remove one or more members of the Tribunal on grounds of alleged impartiality. In these applications, KFELS named the Tribunal members and Hydralift as defendants. The Judge dismissed the applications and awarded $50,000 in costs, ostensibly in favour of
The Tribunal issued the Award on 4 September 2019, dismissing the claim by KFELS and allowing the counterclaim by Hydralift. KFELS’ liability under the Award is the equivalent of $0.7m in damages and $3.1m in costs, plus interest on both sums.
On 6 January 2020, an assistant registrar issued ORC 462 granting leave for NOV Norway to enforce the Award. KFELS then filed SUM 495 to set aside ORC 462.
Decision below The Judge allowed SUM 495 and set aside ORC 462. The Judge noted that the 2004 mergers were governed by Norwegian law since Hydralift, NOH and NOV Norway were all companies incorporated in Norway (GD at [21]). The Judge also made three observations regarding the expert evidence adduced on Norwegian law (GD at [24]–[28]). First, it was undisputed that Hydralift ceased to exist since it was struck off the Norwegian register of companies upon its merger with NOH taking effect on 6 October 2004. Second, there was no evidence that under Norwegian law, the transferee acquires the
The Judge found in favour of KFELS on three independent grounds.
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National Oilwell Varco Norway as v Keppel FELS Ltd
...Oilwell Varco Norway AS (formerly known as Hydralift AS) and Keppel FELS Ltd (formerly known as Far East Levingston Shipbuilding Ltd) [2022] SGCA 24 Sundaresh Menon CJ, Judith Prakash JCA and Quentin Loh JAD Civil Appeal No 188 of 2020 Court of Appeal Arbitration — Enforcement — Setting asi......