PT Pukuafu Indah v Newmont Indonesia Ltd

JurisdictionSingapore
Judgment Date11 September 2012
Date11 September 2012
Docket NumberOriginating Summons No 351 of 2011
CourtHigh Court (Singapore)
PT Pukuafu Indah and others
Plaintiff
and
Newmont Indonesia Ltd and another
Defendant

[2012] SGHC 187

Lee Seiu Kin J

Originating Summons No 351 of 2011

High Court

Arbitration—Award—Recourse against award—Setting aside—Whether time limit under Art 34 (3) UNICITRAL Model Law on International Commercial Arbitration for bringing application to set aside award was mandatory—International Arbitration Act (Cap 143 A, 2002 Rev Ed)

Arbitration—Award—Whether interim order granting interim anti-suit injunction was ‘award’—Section 2 (1) International Arbitration Act (Cap 143 A, 2002 Rev Ed)

Arbitration—Interlocutory order or direction—Whether interim order issued by tribunal might be set aside

The plaintiffs were a company (‘PT Pukuafu’) and six members of a family that were the 100% shareholders (the ‘Merukh parties’). The defendants were a company (‘Newmont’), which had entered into a joint venture with PT Pukuafu, and another company (‘NVL’) which was related to Newmont.

Newmont and NVL had brought arbitration proceedings before the Singapore International Arbitration Centre (‘SIAC’) seeking relief for alleged breaches of contract by PT Pukuafu and the Merukh parties. One of the contracts between the parties was a release agreement whereby the Merukh parties were allegedly bound to discontinue suits that they had commenced in the Indonesian courts. Pursuant to a request from Newmont and NVL, the arbitral tribunal issued an interim order on 15 October 2010 restraining PT Pukuafu and the Merukh parties from continuing with the proceedings before the Indonesian courts or instituting new proceedings.

Leave to enforce the interim order was granted, and PT Pukuafu and the Merukh parties then filed an application before the High Court on 6 May 2011 to set aside the interim order.

Held, dismissing the application:

(1) An ‘award’ might be set aside unders 24 of the International Arbitration Act (Cap 143 A, 2002 Rev Ed) (‘IAA’) and Art 34 of the UNCITRAL Model Law on International Commercial Arbitration (‘Model Law’) in the First Schedule to the IAA. The definition of an ‘award’ unders 2 of the IAA excluded orders or directions made unders 12 of the IAA, and s 12 (1) provided that an arbitral tribunal would have powers to make orders dealing with procedural matters or protective measures: at [10], [11] and [12].

(2) The interim order issued by the arbitral tribunal was in substance an interim anti-suit injunction intended to maintain the status quo until the arbitral tribunal could hold a full hearing on the merits. The interim order was clearly an interim injunction made unders 12 (1) (i)of the IAA and specifically excluded from the definition of an ‘award’ unders 2. The court therefore did not have the jurisdiction to consider an application for the setting aside of the interim order, as the powers unders 24 of the IAA and Art 34 of the Model Law extended only to an ‘award’: at [16], [18] and [19].

(3) The words ‘may not’ in Art 34 (3) of the Model Law, which governed the time limit for bringing an application to set aside an award, were clearly mandatory and imposed a time bar. The application to set aside the interim order was taken out more than three months after the order had been made and was out of time: at [28], [30] and [31].

[Observation: The court's powers to set aside interlocutory orders dealing with procedural and administrative issues should be limited because these issues fell within the province of the arbitral tribunal and should be decided solely by the tribunal. Interim orders might require a more nuanced balance to be struck between the efficiency of arbitration and safeguards to ensure due process as they might have the effect of prejudging the substantive rights of one party and are dependent on the court for coercive effect. Parliament had chosen to strike this balance by adopting the line of minimal curial intervention to limit challenges only to awards that decided the substantive merits of the case: at [23] to [25].

The IAA contained a sui generis enforcement mechanism ins 12 (6) to allow orders and directions given by an arbitral tribunal in the course of arbitration proceedings to be enforced. Enforcement required the leave of the High Court or a judge thereof, and the possibility of refusing leave could provide some measure of residual protection for the rights of both parties: at [21] and [27].]

ABC Co v XYZ Co Ltd [2003] 3 SLR (R) 546; [2003] 3 SLR 546 (folld)

Mohamed Ibrahim and Koshi Mohamed, Re Arbitration Between [1963] MLJ 32 (refd)

PT Asuransi Jasa Indonesia (Persero) v Dexia Bank SA [2007] 1 SLR (R) 597; [2007] 1 SLR 597 (refd)

International Arbitration Act (Cap 143 A, 2002 Rev Ed) ss 2 (1) , 12 (1) , First Schedule Art 34 (3) (consd) ;ss 2, 24, 12 (1) (i) , 12 (6) , 19 B (1)

Rules of Court (Cap 322, R 5, 2006 Rev Ed) O 69 A r 2 (4) , O 69 A r 5 (2)

Teh Ee-Von and Ashton Tan (Infinitus Law Corporation) for the first to third and fifth to seventh plaintiffs

The fourth plaintiff in person

Disa Sim Jek Sok and Kelvin Koh Li Qun (Rajah & Tann LLP) for the defendants.

Lee Seiu Kin J

1 This was the plaintiffs' application to set aside an order (‘the Order’) of the arbitral tribunal (‘the Tribunal’) pursuant to s 24 of the International Arbitration Act (Cap 143 A, 2002 Rev Ed) (‘IAA’) and Art 34 of the Model Law as set out in the First Schedule to the IAA.

2 The Order was an interim order made on 15 October 2010. A partial award (‘Partial Award’) was subsequently given by the Tribunal on 7 April 2011.

3 The plaintiffs applied to set aside the Order on the following grounds:

(a) The agreement to arbitrate was found in a contract dated 26 November 2009 made by the first, second and third plaintiffs with the first defendant (‘the Release Agreement’). As the fourth, fifth, sixth and seventh plaintiffs were not parties to the Release Agreement, it would be a breach of natural justice for them to be bound by the arbitration proceedings.

(b) The arbitration proceedings arose as a result of the alleged breach of the Release Agreement but the Release Agreement was unenforceable as it stifled the prosecution of criminal offences being heard by the Indonesian courts and would hence conflict with the public policy of Singapore.

(c) The Release Agreement was invalid under Indonesian law as it had expired on 26 June 2010.

4 The defendants made the following submissions in response:

(a) The court's jurisdiction to annul arbitral awards did not extend to the Order as it was an interim measure.

(b) The application to set aside the Order had been filed out of time.

(c) The application should fail because the plaintiffs had waived their objections to the Order by declining to participate in the arbitration proceedings or court...

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    ...domain for no countervailing benefit. As Lee Seiu Kin J pointed out in PT Pukuafu Indah and others v Newmont Indonesia Ltd and another [2012] 4 SLR 1157 (“PT Pukuafu”), a recalcitrant party could use such a provision to obstruct an arbitration with tactical challenges on matters of mere pro......
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3 books & journal articles
  • Arbitration
    • Singapore
    • Singapore Academy of Law Annual Review No. 2014, December 2014
    • 1 Diciembre 2014
    ...properly so called. An interim measure under s 12 of the IAA has been held by Lee Seiu Kin J in PT Pukuafu Indah v Newmont IndonesiaLtd[2012] 4 SLR 1157not to be an award and is incapable of being setaside as it is intended to operate until the award in the arbitration is made. An award, on......
  • Arbitration
    • Singapore
    • Singapore Academy of Law Annual Review No. 2012, December 2012
    • 1 Diciembre 2012
    ...to any of the recourse process under Art 34 of the Model Law. 4.11 This issue arose again in PT Pukuafu Indah v Newmont Indonesia Ltd[2012] 4 SLR 1157. There were disputes between the parties arising from various agreements, one of which was a release agreement, pursuant to which the plaint......
  • Arbitration
    • Singapore
    • Singapore Academy of Law Annual Review No. 2019, December 2019
    • 1 Diciembre 2019
    ...SLR 372. 48 See paras 4.47–4.52 above. 49 See para 4.37 above. 50 The full text is cited at para 4.36 above. 51 [2003] 3 SLR(R) 546. 52 [2012] 4 SLR 1157. 53 ABC Co v XYZ Co Ltd [2003] 3 SLR(R) 546 at [19]. 54 See para 4.32 above. 55 [2019] SGHC 260. 56 [2019] SGHC 185. 57 [2016] 1 SLR 966.......

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