Singapore High Court Provides Guidance On Stays Of Arbitral Proceedings

A recent decision of the Singapore High Court has clarified the circumstances in which it will order a stay of arbitral proceedings pending a challenge to the tribunal's jurisdiction.

By way of background, a tribunal in a Singapore-seated arbitration is empowered to rule on its own jurisdiction. If a tribunal rules that it has no jurisdiction (at any stage of the proceedings) or that it has jurisdiction (on a plea as a preliminary question), the International Arbitration Act (the "Act") permits any of the parties to apply to the High Court to determine the matter. International Arbitration Act (Cap 143A), section 10(3).

Section 10(9) of the Act provides that any such application will not operate as a stay of the arbitral proceedings unless the High Court orders otherwise. In other words, the default position is that the arbitration will continue concurrently with the High Court application. It has long been unclear what test the High Court will apply in deciding whether to stay the arbitral proceedings under section 10(9).

In the recent case of AYY v AYZ & Anor, [2015] SGHCR 22, Assistant Registrar Seow noted the dearth of authorities on this point and succinctly formulated a test based on the established principles applicable to the stay of execution of court judgments pending appeals. Seow AR stated that a stay of arbitration will generally be ordered if "an applicant is able to demonstrate with reasonable and credible substantiation that a refusal of stay would result in detriment in respect of which the applicant could not later be adequately restituted." [2015] SGHCR 22 at [7].

Any additional cost burden, of itself, is unlikely to satisfy this test because the High Court can always make an appropriate costs...

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