Arbitration Law Monthly

In Tjong Very Sumito v Antig Investments Pte Ltd [2009] SGCA 41 the Singapore Court of Appeal tackled a problem which has long bedevilled arbitration law. A claim is brought by party X against party Y. Y seeks a stay of the proceedings on the basis that there is an arbitration clause. A’s riposte is that there is no dispute between the parties. It is settled in England that the English courts will not hear arguments on the matter, and will grant a stay: Halki Shipping Corporation v Sopex Oils Ltd [1998] 1 WLR 726. However, the position where there has been an admission of liability by Y is as yet unresolved. Tjiong Very Sumito throws clear light on this point. The case was heard by Justices of Appeal V K Rajah and Andrew Phang, the court’s judgment being delivered by the former.

In spite of the unequivocal decision of the ECJ inThe Front Comor [2009] 1 Lloyd’s Rep 413that anti-suit injunctions are incompatible with the Regulation and fundamentally, the principle of mutual trust, the Court of Appeal inNational Navigation Co v Endesa [2009] EWCA Civ has controversially opined that declarations of validity may be used as grounds for non-recognition of a foreign judgment where the declaration is given prior to the foreign court’s decision. This reading however is unlikely to be favourable in Europe, as declarations may now be seen as having the same adverse effect as anti-suit injunctions. The case is discussed by Jennifer Lavelle of the Institute of Maritime Law, University of Southampton.

The issue in National Ability SA v Tinna Oils & Chemicals Ltd, The Amazon Reefer [2009] EWCA Civ 1330, discussed by George Spalton of 4 New Square, considers the operation of the Limitation Act 1980 in its application to arbitration awards. The limitation period of six years under s7 of the Limitation Act 1980 applies to all applications to enforce arbitration awards in the same manner as a judgment under s26 of the Arbitration Act 1950 (the provisions of which are, in all material respects, identical to s66 ofthe Arbitration Act 1996).

A person faced with arbitration proceedings who asserts that there is no valid or binding arbitration agreement in existence or which extends to the dispute in question may decide to appear in the arbitration to contest jurisdiction, or he may refuse to take any part in the proceedings and either sit tight to await the award or take pre-emptive action to seek a declaration from the courts. The latter option is conferred by s72 of the Arbitration Act 1996, and was exercised in Secretary of State for Transport v Stagecoach South Western Trains Ltd [2009] EWHC 2431 (Comm).The issue was the construction of an arbitration clause in a franchise agreement.