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As Singapore continues to cement its position as one of the world’s preferred seats of arbitration globally, it is perhaps unsurprising that we are seeing an increasing number of arbitration-related cases in the Singapore courts, including the Singapore Court of Appeal (the court of final appeal in Singapore, which hears arbitration-related cases appealed from the General Division of the High Court).
This series of articles aims to provide a quick overview of the recent cases and summarise the takeaways from each of them. In the first of this Singapore Arbitration series, we review the first decision CJA v CIZ .
The underlying dispute in this case arose out of a consultancy agreement relating to acquisitions of oil and gas fields around the world, where CJA claimed payment of success fees for presenting two opportunities to CIZ. CIZ denied liability on the basis that the underlying agreements had already expired.
The tribunal awarded approximately USD 5 million to CJA, this being its success fee for one of the opportunities presented to CIZ. CIZ applied to set aside this part of the Award, on the grounds that the tribunal had exceeded its jurisdiction and breach of natural justice. Although the application was allowed in the first instance before the High Court Judge, both grounds failed to find favour with the Court of Appeal.
On excess of jurisdiction, the Court of Appeal restated the trite principle that an arbitral tribunal has no jurisdiction to decide any issue which was not referred to it for determination by the parties. In ascertaining what parties submitted to arbitration, the court will look at matters to determine whether the issues in question were live issues in the arbitration.
Here, the Court of Appeal undertook a close examination of the parties’ pleadings, submissions and evidence adduced in the arbitration proceedings, and held that the fundamental point upon which the tribunal found for CJA (i.e. that various provisions of the agreement provided for a success fee to be payable upon completion of the opportunity regardless of when that took place) was present in CJA’s submissions in the arbitration. CIZ also had, in its closing submissions, argued against this fundamental point. This issue was therefore canvassed before the tribunal, and the tribunal’s findings were within the scope of the dispute submitted to it. This ground accordingly failed.
As to the breach of natural justice, CIZ argued that the tribunal had adopted a chain of reasoning in its award which it did not give CIZ a reasonable opportunity to address, and that the tribunal had incorrectly taken a position which was diametrically opposed to both parties’ positions. This ground also failed. The Court of Appeal considered that an arbitral tribunal cannot be constrained and prevented from arriving at conclusions which are opposed to the parties’ views, as long as the parties have had an opportunity to address all the essential issues which led the tribunal to such conclusions.