Silverlink Resorts Ltd v MS First Capital Insurance Ltd
Jurisdiction | Singapore |
Court | High Court (Singapore) |
Judge | Chua Lee Ming J |
Judgment Date | 16 November 2020 |
Neutral Citation | [2020] SGHC 251 |
Citation | [2020] SGHC 251 |
Plaintiff Counsel | Nair Suresh Sukumara and Yeow Guan Wei, Joel (PK Wong & Nair LLC) |
Defendant Counsel | Lok Vi Ming SC, Lee Sien Liang, Joseph, Pak Waltan and Qabir Singh Sandhu (LVM Law Chambers LLC) |
Hearing Date | 10 September 2020,03 September 2020 |
Published date | 24 November 2020 |
Docket Number | Originating Summons No 496 of 2020 (Summons No 2633 of 2020) (Registrar's Appeal No 185 of 2020) |
Subject Matter | Arbitration,Mandatory stay under International Arbitration Act,Grounds,Carve outs,Interpretation,Agreement,Stay of court proceedings,Scope |
Businessmen should be familiar enough with arbitration by now to realise that arbitration is an
The plaintiff, Silverlink Resorts Limited, is one of the insured parties under an Industrial All Risks Policy (“the Policy”) issued by the defendant, MS First Capital Insurance Limited. The consequences of the COVID-19 pandemic led to the plaintiff making a claim under the Policy. The defendant disputed the claim and the plaintiff filed the present Originating Summons, seeking, among other things, a declaration that the plaintiff has a valid claim under the Policy.
By Summons No 2633 of 2020 (“SUM 2633”), the defendant applied to stay the proceedings in this Originating Summons in favour of arbitration, pursuant to s 6 of the International Arbitration Act (Cap 143A, 2002 Rev Ed) (“IAA”). The learned Assistant Registrar (“AR”) dismissed the application. I heard and dismissed the defendant’s appeal against the AR’s decision.
BackgroundThe plaintiff is a company incorporated in the British Virgin Islands and is the ultimate holding company of a group of companies known as the “Aman Group” that owns and manages luxury hotels in various parts of the world, including the Amanpuri resort in Pansea Beach, Phuket, Thailand (“the Amanpuri”).
The defendant is a company incorporated in Singapore and is in the business of writing and providing non-life insurance.
As stated earlier, the plaintiff was one of the insured parties under the Policy issued by the defendant. On 6 September 2019, the plaintiff renewed the Policy to cover the period from 1 July 2019 to 30 June 2020 (both dates inclusive). The Policy covered various properties under the Aman Group, including the Amanpuri.
The Policy comprised a Renewal Certificate and a set of terms and conditions.i Section I of the terms and conditions was entitled “Material Loss or Damage” and it dealt with damage to properties covered by the Policy. Section II of the terms and conditions was entitled “Business Interruption” and it dealt with interruption of or interference with the businesses covered by the Policy. The terms and conditions also included a set of General Conditions which were applicable to all Sections of the Policy unless specifically stated to the contrary (“the General Conditions”).ii
On 2 April 2020, in light of the COVID-19 pandemic, the Governor of the Province of Phuket ordered the closure all hotels in Phuket. The Amanpuri had to be closed as a result of this order. In addition, the Civil Aviation Authority of Thailand banned all international flights to Thailand.
Section II of the Policy contained, among other things, the following provisions:
CLOSURE BY PUBLIC AUTHORITIES (LIMIT: USD10,000,000) Loss resulting from interruption or interference with the Business directly or indirectly arising from closure denial of access or evacuation of the whole or part of the Premises by order of a competent public or civil authority due to the operation of a cause of peril not Excluded by this Policy shall be deemed to be a loss resulting from Damage to property used by the insured at the Premises.
…
CONTINGENT BUSINESS INTERRUPTION (LIMIT: 10% OF INSURED VALUES FOR RESPECTIVE LOCATIONS) This Policy is extended to cover the actual loss sustained and/or Extra Expenses incurred by the Insured which the Insured would have accounted for on an Accruals Basis during the Indemnity Period resulting from:
Direct physical loss or physical damage
OR
Closure by Public Authorities due to perils insured under this Policy but not necessitating direct physical loss or physical damage
to the following specified locations:
- …
- Phuket International Airport
222 Mai Khao, Thalang, Phuket, Thailand- …
…
The plaintiff therefore made a claim under the Policy based on the hotel closure order by the Governor of the Province of Phuket and the closure of the Phuket International Airport by the Civil Aviation Authority of Thailand.
However, the defendant rejected the plaintiff’s claim on the ground that “in order for a claim to be admitted under Section II, a claim must have been made and accepted by Insurers under the corresponding Section I of the [Policy] for material damage loss”. It concluded that as “there was no material damage whatsoever to any of the insured properties at the risk premises and/or other interested locations in this instance”, the plaintiff’s claims were hence not admissible.iii
On 29 May, the plaintiff commenced the present proceedings seeking the following:
On 2 July 2020, the defendant filed SUM 2633 seeking to stay the present proceedings in favour of arbitration.
The issueThe defendant’s application was made under s 6 of the IAA which states as follows:
Enforcement of international arbitration agreement
…
It is well established that a court hearing such a stay application should grant a stay in favour of arbitration if the applicant is able to establish a
In the present case, the General Conditions provided for mediation, arbitration as well as the jurisdiction of the courts in Singapore. Clauses 10, 11 and 13 of the General Conditions provided as follows:iv
Any dispute arising out of or in connection with this contract , including any question regarding its existence, validity or termination, which is not settled pursuant to the Mediation General Condition within sixty (60) days of commencement of the discussions described in the Mediation General Condition (a) above, shall be referred to arbitration and the parties shall unless otherwise mutually agreed, use the best practice within the jurisdiction of this Policy to have the dispute arbitrated before legal action is commenced.…
Should
any dispute arise between the Insured and the Insurers regarding the interpretation or the application of this Policy the Insurers will, at the request of the Insured, submit to the jurisdiction of any competent Court in Singapore. Such a dispute shall be determined in accordance with the practical applicable to such Court and in accordance with the laws of Singapore.[emphasis added]
The Renewal Certificate included the following provision:
| | |
[emphasis added]
Clause 11 (the “Arbitration Clause”) was expressed to apply to “any dispute arising out of or in connection with” the Policy which was not settled pursuant to cl 10 (the “Mediation Clause”). Clause 13 (the “Jurisdiction Clause”) was expressed to apply to “any dispute … regarding the...
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