Singapore Arbitration: Singapore Courts Continue To Be Reluctant To Set Aside Arbitral Awards

• Law Firm: Mayer Brown
• Subject Matter: Corporate/Commercial Law, Litigation, Mediation & Arbitration, Contracts and Commercial Law, Arbitration & Dispute Resolution
• Author: Mr Yu-Jin Tay, Kate H. Apostolova, Matt C. Shaw, Charles K. S. Tay, Maleeha Khan and Beatrice Tsang
• Published date: 29 March 2023

Last week, in the third of a string of such cases this year, in CWP v. CWQ [2023] SGHC 61, the High Court of Singapore refused to set aside an arbitral award on breach of natural justice grounds. As we reported recently (see here and here), this decision affirms the high standard for breach of natural justice claims in set aside applications in Singapore and reflects the Singapore courts' general reluctance to set aside arbitral awards.

Key Takeaways

• In this decision, the High Court of Singapore affirmed that the Singapore courts will not interfere with an arbitral award on an allegation by a party that a tribunal reached the wrong decision but they may intervene if there has been a breach of natural justice.
• The Court also clarified that a party's reservation of rights does not absolve it from the responsibility of affirmatively raising an argument during the arbitration, and it cannot belatedly submit such an argument for the first time in its set aside application.

The Parties and Their Dispute

In May 2017, CWP (the "Claimant"), a construction company, and CWQ (the "Defendant"), a marine engineering company, entered into a contract under which the Defendant was to deploy four vessels to carry out construction works to be completed within a 90-day period.

Article 3.9 of the contract was central to the parties' dispute. This provision stated that the stoppage of works, other than for mechanical breakdown of the vessels or any other reason attributable to the contractor CWQ, entitled them to an extension of time and compensation. Over the course of the project, there were several stoppages, which resulted in delays.

Disputes arose between the parties regarding the Defendant's entitlement to compensation and extension of time under Article 3.9.

The Defendant commenced arbitration proceedings against the Claimant in October 2018 and sought compensation.

In May 2022, the Tribunal issued an award, agreeing with the Defendant's interpretation that Article 3.9 entitled the Defendant to compensation.

The presiding arbitrator issued a dissenting opinion, finding that the Claimant was not liable for damages for any of the stoppages.

The Claimant then filed an application to set aside the award on breach of natural justice grounds, arguing that the majority went beyond the scope of submission to arbitration in deciding certain issues.

The Court's Decision

The Court refused the set aside application.

In its decision, the Court addressed the main issues raised by...