P.T. Garuda Indonesia v Birgen Air: Setting Aside Arbitration Award Based on Place of Arbitration

P.T. Garuda Indonesia, an Indonesian company, appealed against the High Court's decision to set aside an order granting leave to serve an Originating Motion out of jurisdiction on Birgen Air, a Belgium company, regarding a dispute arising from a lease agreement. The Court of Appeal dismissed the appeal, holding that the place of arbitration was Jakarta, not Singapore, and therefore Singapore courts lacked jurisdiction to set aside the arbitration award. The primary legal issue was whether the parties had agreed to change the place of arbitration from Jakarta to Singapore.

1. Case Overview

1.1 Court

Court of Appeal

1.2 Outcome

Appeal Dismissed

1.3 Case Type

Civil

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

Appeal regarding setting aside an order for service of an Originating Motion out of jurisdiction. The court determined the place of arbitration was Jakarta, not Singapore.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
P.T. Garuda IndonesiaAppellantCorporationAppeal DismissedLost
Birgen AirRespondentCorporationAppeal DismissedWon

3. Judges

Judge NameTitleDelivered Judgment
Chao Hick TinJudge of AppealYes
Tan Lee MengJudgeNo

4. Counsels

Counsel NameOrganization
Quahe Cheng Ann LawrenceHarry Elias Partnership
KS RajahHarry Elias Partnership
Saunthararajah SurenthirarajHarry Elias Partnership
Michele EliasHarry Elias Partnership
Vangat RamayahWee Ramayah & Partners
Rajaram RamiyahWee Ramayah & Partners

4. Facts

  1. Garuda and Birgen entered into a lease agreement on 20 January 1996.
  2. The lease agreement stipulated that Indonesian law would govern the agreement.
  3. The lease agreement stipulated that arbitration would be held in Jakarta.
  4. A dispute arose when Birgen proposed to substitute the aircraft.
  5. The arbitral tribunal proposed holding the hearing in Singapore due to the situation in Indonesia.
  6. Both parties eventually agreed to hold the hearing in Singapore.
  7. The Final Award stated that it was delivered at Jakarta.

5. Formal Citations

  1. P.T. Garuda Indonesia v Birgen Air, CA 600099/2001, [2002] SGCA 12

6. Timeline

DateEvent
Lease agreement signed between Garuda and Birgen.
Arbitral tribunal sought to set dates for hearing.
Tribunal proposed Zurich as hearing location.
Tribunal proposed Singapore as hearing location.
Birgen's lawyers agreed to Singapore as hearing location.
Tribunal notified parties of hearing in Singapore on August 4-6, 1999.
Garuda's lawyers agreed to hearing in Singapore on August 4-6, 1999.
Tribunal reiterated hearing would take place in Singapore.
Hearing held in Singapore.
Final Award handed down.
Addendum to the Final Award handed down.
Garuda filed Notice of Originating Motion in Singapore High Court.
Garuda applied for leave to serve Notice of OM out of Singapore.
Assistant Registrar granted Garuda's application.
Birgen applied to set aside the order of 30 March 2001.
Woo Bih Li JC set aside the order and all proceedings taken pursuant thereof.
Appeal dismissed.

7. Legal Issues

  1. Place of Arbitration
    • Outcome: The court held that the place of arbitration was Jakarta, not Singapore.
    • Category: Jurisdictional
    • Sub-Issues:
      • Distinction between place of arbitration and venue of hearing
      • Agreement to alter place of arbitration
  2. Service Out of Jurisdiction
    • Outcome: The court held that this was not a proper case to grant leave to serve the papers out of jurisdiction.
    • Category: Procedural
    • Sub-Issues:
      • Leave to serve notice of originating motion out of jurisdiction
      • Material non-disclosure
  3. Natural Forum
    • Outcome: The court held that Indonesia was the most appropriate forum.
    • Category: Jurisdictional
    • Sub-Issues:
      • Singapore's connection with arbitration
      • Appropriateness of Singapore as forum

8. Remedies Sought

  1. Setting aside the Final Award
  2. Setting aside the Addendum

9. Cause of Actions

  • Breach of Contract

10. Practice Areas

  • Arbitration
  • Commercial Litigation

11. Industries

  • Aviation

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
Overseas Union Insurance Ltd v Incorporated General Insurance LtdCourt of AppealYes[1992] 1 Lloyd’s Rep 439England and WalesCited for the principle that the applicant must show merits in the case and that Singapore was a forum conveniens.
Naviera Amazonica Peruana SA v Cia International de SegurosUnknownYes[1988] 1 Lloyd’s Rep 116England and WalesCited to distinguish between the 'place of arbitration' and the 'venue of hearing'.
Union of India v McDonnell Douglas CorporationUnknownYes[1933] 2 Lloyd’s Rep 48England and WalesCited regarding the choice of law governing arbitration proceedings.
ABB Lummus v Keppel FELSUnknownYes(1999) 2 Lloyd’s Rep 24England and WalesCited as an example of an express agreement to alter the place of arbitration.

13. Applicable Rules

Rule Name
Order 69A r 4(2) Rules of Court

14. Applicable Statutes

Statute NameJurisdiction
International Arbitration ActSingapore

15. Key Terms and Keywords

15.1 Key Terms

  • Place of arbitration
  • Venue of hearing
  • International Arbitration Act
  • Model Law
  • Originating Motion
  • Service out of jurisdiction
  • Forum conveniens
  • Curial law

15.2 Keywords

  • Arbitration
  • Singapore
  • Jakarta
  • Jurisdiction
  • International Arbitration Act
  • Model Law
  • Service out of jurisdiction

17. Areas of Law

Area NameRelevance Score
International Arbitration90
Arbitration90
Conflict of Laws80
Jurisdiction70
Foreign Law60
Civil Procedure50
Contract Law40

16. Subjects

  • Arbitration
  • Conflict of Laws
  • Civil Procedure