The Court Of Appeal's Take On Limitation Laws In Hindustan Oil

• Published date: 02 June 2023
• Subject Matter: Litigation, Mediation & Arbitration, Arbitration & Dispute Resolution
• Law Firm: Shearn Delamore & Co.
• Author: Wong Wen Sheng

Introduction

Previously, we highlighted the High Court decision in Hindustan Oil on Limitation laws in the arbitration context. On 4 April 2023, the Court of Appeal affirmed the High Court decision in Hindustan Oil Exploration Company Limited v Hardy Exploration & Production (India) Inc [2023] MLJU 795, albeit with a slight variation.

The Court of Appeal decision

While arriving at the same conclusion, the Court of Appeal differed with the High Court chiefly on the following points:

Classification of Limitation laws

The High Court accepted the "tribunal versus claim" approach propounded by the Singapore Court of Appeal case of BBA v BAZ [2020] SGCA 5 which seeks to classify issues of Limitation as either a matter of "admissibility" or "jurisdiction" at the outset. Matters on admissibility are within the purview of the arbitral tribunal, while matters on jurisdiction, the Court. The High Court went on to hold that as limitation periods "attacked" a claim, it went towards admissibility and hence the Court has no jurisdiction to decide on the same.

The Court of Appeal, however, took a different view.

The Court of Appeal rejected the test in BBA, holding that the "pure determination" is whether issues of Limitation are procedural or substantive. The Court held that they are procedural in nature because time limitations are entirely disjointed and unaffected by the merits of the parties' case ' they are blind to the merits.

Thus, the Court of Appeal held that the law of the seat informs the Limitation laws, i.e., Malaysian Limitation laws, emanating from the seat, govern the arbitration. The arbitral tribunal was therefore correct in applying Malaysian Limitation laws to the dispute.

Extent of curial intervention

While issues of Limitation are procedural, the elephant in the room is, does the Court have power to review an arbitral tribunal's decision or decision-making process in arriving at the applicable Limitation law?

In essence, the High Court said no, given that this is a question of law which the arbitral tribunal is entitled to rule on. Further, the High Court was resolute in holding that to set aside an arbitral award, a party can only rely on the grounds set out in section 37 of the Arbitration Act ("AA"), expressly rejecting the notion that section 30 of the AA (which provides that an arbitral...