Arbitrability: The "Composite" Approach

• Law Firm: Shearn Delamore & Co.
• Subject Matter: Litigation, Mediation & Arbitration, Arbitration & Dispute Resolution
• Author: Cassandra Oh and Wong Wen Sheng
• Published date: 13 February 2023

Introduction

What happens when the law of the arbitration agreement and the law of the seat diverge on the matter of arbitrability of a dispute? This was considered very recently by the Singapore Court of Appeal in Anupam Mittal v Westbridge Ventures II Investment Holdings¹ ('Anupam Mittal'). The Court held that the arbitrability of a dispute, at the pre-award stage, is determined by both the law governing the arbitration agreement and the law of the seat.

Significance of the 'Composite' approach

The 'composite' approach requires that the dispute is arbitrable by the law governing the arbitration agreement. Nonetheless, if the law of the seat considers the dispute to be non-arbitrable, the Singapore courts will not permit the arbitration to proceed on grounds of public policy. The Singapore courts are guided by the following considerations in determining the arbitrability of a dispute pre-award:

1. The three-stage test in BCY v BCZ² determines the law of the arbitration agreement; and
2. In a Singapore-seated arbitration, the dispute is arbitrable where the law of the seat is consistent with the law of the arbitration agreement.

This decision serves as a timely reminder to parties to take charge of the matter of arbitrability; one suggestion is for parties to select arbitration friendly laws to govern the seat and the arbitration...