Tjong Very Sumito and Others v Antig Investments Pte Ltd

JurisdictionSingapore
CourtHigh Court (Singapore)
JudgeChoo Han Teck J
Judgment Date10 November 2008
Neutral Citation[2008] SGHC 202
Citation[2008] SGHC 202
Defendant CounselManjit Singh (Manjit Govind & Partners)
Docket NumberSuit No 348 of 2008 (Registrar's Appeal No 333 of 2008)
Published date13 November 2008
Plaintiff CounselMichael Hwang SC and Charis Tan (instructed) / Nicholas Narayanan (Nicholas & Co)
Date10 November 2008
Subject MatterSection 6(2) International Arbitration Act (Cap 143A, 2002 Rev Ed),Mandatory stay under International Arbitration Act (Cap 143A, 2002 Rev Ed),Arbitration,Whether positive assertion of dispute by a party sufficient to stay proceedings,Stay of court proceedings,Whether dispute in fact existed

10 November 2008

Choo Han Teck J:

1 The plaintiffs and the defendant entered into a Shares Sale and Purchase Agreement in November 2004 (“SPA”), under which the plaintiffs agreed to sell to the defendant 72% of the entire paid-up share capital of a company. The SPA also provided that “any and all disputes, controversies or conflicts arising out of or in connection with [the SPA] or its performance shall be settled by arbitration…”. The parties subsequently entered into four supplementary agreements, the last of which was dated 19 August 2005 and provided, inter alia, that:

2.2(e)(ii) on the date falling 24 months from the Completion Date, US$3,700,000 shall be paid to Aventi, who is authorised to receive the same for and on behalf of the Vendors.

2 In late September 2007, Aventi requested for an early settlement of the US$3.7m (the original payment date being 13 June 2008). In return, Aventi granted the defendant a discount of 5.6%. On or about 7 November 2007, the defendant released a sum of some $3.5m to Aventi. This was not the first occasion that the defendant paid Aventi in advance. In July 2006, the defendant was granted a 6% discount for the early settlement of a US$2m payment. On 12 November 2007, the first plaintiff wrote to the defendant stating that:

I have agreed on 29 October 2007 that the final amount of the Balance Purchase Price due to me is US$1,138,772. Kindly issue a cheque for the sum of $1,630,038.24 (equivalent to US$1,138,772), being final settlement of the Balance Purchase Price.

3 On 9 April 2008, the plaintiffs informed the defendant that the sum of US$3.7m was to be made to the first plaintiff, and that no payments should be made to Aventi. The defendant refused to do so. On 20 May 2008, the plaintiffs commenced an action in the High Court to restrain the defendant from effecting payment of the sum of US$3.7m to any party other than the plaintiffs. There was also a claim for damages to be assessed. The defendant then applied for a stay under s 6 of the International Arbitration Act (Cap 143A) (“IAA”) or alternatively under the court’s inherent jurisdiction. The plaintiffs resisted the stay application on the ground that there was “no dispute” and that the defendant had no defence to the plaintiffs’ claim. The matter was heard by an assistant registrar who agreed with the plaintiffs. The defendant’s application for a stay was accordingly dismissed. The defendant then appealed.

The decision of the court

4 The applicable law was not in dispute and counsel for both parties relied on Dalian Hualiang Enterprise Group Co Ltd v Louis Dreyfus Asia Pte Ltd [2005] 4 SLR 646 (“Dalian”). The relevant principles set out in Dalian, were as follows:

As regards s 6(2) IAA, I am of the view that once there is a dispute, a stay must be ordered unless the arbitration agreement is null and void, inoperative or incapable of being performed. The court is not to consider if there is in fact a dispute or...

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