CDI v CDJ: Setting Aside Enforcement Order of Arbitration Award for Vessel Sale
In CDI v CDJ, the Singapore High Court addressed an application by CDJ to set aside an order granting CDI leave to enforce a Final Arbitration Award related to a dispute over the sale and purchase of three vessels. The court, presided over by S Mohan JC, dismissed CDJ's application, finding no breach of natural justice or that the arbitrator exceeded the scope of submission. The court upheld the arbitrator's decision, which favored CDI, ordering CDJ to pay US$335,000 representing the deposit for the purchase of the vessels.
1. Case Overview
1.1 Court
High Court of the Republic of Singapore1.2 Outcome
Defendant's application dismissed.
1.3 Case Type
Arbitration
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
Singapore High Court dismisses application to set aside enforcement of arbitration award regarding a vessel sale, finding no breach of natural justice.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| CDI | Plaintiff | Corporation | Application allowed | Won | Chew Sui Gek Magdalene, Cai Jianye Edwin, Tan Chengxi |
| CDJ | Defendant | Corporation | Application dismissed | Lost | Chenthil Kumar Kumarasingam, Sherah Tan Ying Zhong |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| S Mohan | Judicial Commissioner | Yes |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Chew Sui Gek Magdalene | AsiaLegal LLC |
| Cai Jianye Edwin | AsiaLegal LLC |
| Tan Chengxi | AsiaLegal LLC |
| Chenthil Kumar Kumarasingam | Oon & Bazul LLP |
| Sherah Tan Ying Zhong | Oon & Bazul LLP |
4. Facts
- Plaintiff and Defendant entered into a Memorandum of Agreement (MOA) for the sale and purchase of three vessels.
- The MOA included clauses regarding buyer's and seller's default and the refund of a deposit.
- The Plaintiff paid a deposit of US$335,000 to the Defendant.
- CF issued a Term Commitment Letter (TCL) to the Plaintiff for financing the purchase.
- CF later informed the Plaintiff that it was no longer able to fund the purchase.
- The Plaintiff claimed entitlement to a refund of the deposit, which the Defendant refused.
- The dispute was referred to arbitration pursuant to the MOA.
5. Formal Citations
- CDI v CDJ, Originating Summons 1521 of 2019 (Summons 6442 of 2019), [2020] SGHC 118
6. Timeline
| Date | Event |
|---|---|
| Suit No. 300 of 2016 (HC/S 300/2016) commenced in the High Court | |
| Consent Order of Court (HC/ORC 4528/2016) issued | |
| Memorandum of Agreement signed | |
| First Term Commitment Letter issued | |
| Second Term Commitment Letter issued | |
| Final funding deadline under Second Term Commitment Letter | |
| Plaintiff informed that CF was no longer able to fund the purchase of the Vessels | |
| Plaintiff demanded return of Deposit | |
| Final Arbitration Award issued | |
| Additional Award to the Final Arbitration Award issued | |
| Leave Order granted | |
| Leave Order served on the Defendant | |
| Summons 6442 of 2019 filed | |
| Hearing before S Mohan JC | |
| Hearing before S Mohan JC | |
| Judgment reserved |
7. Legal Issues
- Breach of Natural Justice
- Outcome: The court found no breach of natural justice in the making of the Award.
- Category: Procedural
- Sub-Issues:
- Exclusion of evidence of pre-contractual negotiations
- Selective consideration of matters
- Related Cases:
- [2014] 1 SLR 372
- [2007] 3 SLR(R) 86
- [2013] 1 SLR 125
- [2020] 1 SLR 695
- Scope of Submission to Arbitration
- Outcome: The court found that the Arbitrator did not exceed the scope of submission to arbitration.
- Category: Jurisdictional
- Related Cases:
- [2007] 1 SLR(R) 597
- [2010] 3 SLR 1
- [2011] 4 SLR 305
- Contractual Interpretation
- Outcome: The court upheld the Arbitrator's interpretation of the contract.
- Category: Substantive
- Sub-Issues:
- Interpretation of entire agreement clause
- Admissibility of pre-contractual evidence
- Related Cases:
- [2011] 4 SLR 1094
- [2015] 5 SLR 1187
8. Remedies Sought
- Return of Deposit
- Monetary Damages
9. Cause of Actions
- Breach of Contract
- Unjust Enrichment
- Restitution
10. Practice Areas
- Arbitration
- Commercial Litigation
11. Industries
- Shipping
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| PT First Media TBK (formerly known as PT Broadband Multimedia TBK) v Astro Nusantara International BV and others and another appeal | Court of Appeal | Yes | [2014] 1 SLR 372 | Singapore | Cited for the principle that the grounds for resisting enforcement of a foreign award under Article 36(1) of the Model Law are equally applicable to a party resisting enforcement of a domestic international award under s 19 IAA. |
| Sui Southern Gas Co Ltd v Habibullah Coastal Power Co (Pte) Ltd | High Court | Yes | [2010] 3 SLR 1 | Singapore | Cited for the principle that a party challenging an arbitral award on the basis that it is against public policy must specifically identify the public policy that would be breached. |
| John Holland Pty Ltd v Toyo Engineering Corp (Japan) | High Court | Yes | [2001] 1 SLR(R) 443 | Singapore | Cited for the principle that a party challenging an arbitral award on the basis that it is against public policy must specifically identify the public policy that would be breached. |
| PT Asuransi Jasa Indonesia (Persero) v Dexia Bank SA | Court of Appeal | Yes | [2007] 1 SLR(R) 597 | Singapore | Cited for the definition of public policy under the International Arbitration Act. |
| AJU v AJT | Court of Appeal | Yes | [2011] 4 SLR 739 | Singapore | Cited for the proposition that the public policy ground encompasses breach of natural justice. |
| Soh Beng Tee & Co Pte Ltd v Fairmount Development Pte Ltd | High Court | Yes | [2007] 3 SLR(R) 86 | Singapore | Cited for the elements that must be established by a party challenging an arbitral award on the ground that there has been a breach of natural justice. |
| L W Infrastructure Pte Ltd v Lim Chin San Contractors Pte Ltd and another appeal | Court of Appeal | Yes | [2013] 1 SLR 125 | Singapore | Cited for the elements that must be established by a party challenging an arbitral award on the ground that there has been a breach of natural justice. |
| China Machine New Energy Corp v Jaguar Energy Guatemala LLC | Court of Appeal | Yes | [2020] 1 SLR 695 | Singapore | Cited for the elements that must be established by a party challenging an arbitral award on the ground that there has been a breach of natural justice. |
| Beijing Sinozonto Mining Investment Co Ltd v Goldenray Consortium (Singapore) Pte Ltd | High Court | Yes | [2014] 1 SLR 814 | Singapore | Cited for the standard of proof for challenging enforcement of a foreign arbitral award. |
| Denmark Skibstekniske Konsulenter A/S I Likvidation v Ultrapolis 3000 Investments Ltd | High Court | Yes | [2010] 3 SLR 661 | Singapore | Cited for the standard of proof for refusing enforcement of a foreign arbitral award. |
| Strandore Invest A/S and others v Soh Kim Wat | High Court | Yes | [2010] SGHC 151 | Singapore | Cited for the standard of proof for refusing enforcement of a foreign arbitral award. |
| Galsworthy Ltd of the Republic of Liberia v Glory Wealth Shipping Pte Ltd | High Court | Yes | [2011] 1 SLR 727 | Singapore | Cited for the standard of proof for refusing enforcement of a foreign arbitral award. |
| TMM Division Maritima SA de CV v Pacific Richfield Marine Pte Ltd | High Court | Yes | [2013] 4 SLR 972 | Singapore | Cited for the principle that an arbitral award is to be read generously and in a reasonable and commercial way. |
| OMG Holdings Pte Ltd v Pos Ad Sdn Bhd | High Court | Yes | [2012] 4 SLR 231 | Singapore | Cited in the context of the court’s powers to allow an unpleaded claim being raised. |
| Yap Son On v Ding Pei Zhen | High Court | Yes | [2017] 1 SLR 219 | Singapore | Cited for principles related to inadmissible extrinsic evidence. |
| AQU v AQV | High Court | Yes | [2015] SGHC 26 | Singapore | Cited for the principle that the principles of natural justice are not breached just because an arbitrator comes to a conclusion that is not argued by either party as long as that conclusion reasonably flows from the parties’ arguments. |
| JVL Agro Industries v Agritrade International Pte Ltd | High Court | Yes | [2016] 4 SLR 768 | Singapore | Cited for the principle that a particular chain of reasoning would be open to an arbitrator if the links in the chain flow reasonably from the arguments actually advanced by either party or are related to those arguments. |
| Glaziers Engineering Pte Ltd v WCS Engineering Construction Pte Ltd | Court of Appeal | Yes | [2018] 2 SLR 1311 | Singapore | Cited for scenarios which may result in surprising outcomes for the parties. |
| Sheng Siong Supermarket Pte Ltd v Carilla Pte Ltd | High Court | No | [2011] 4 SLR 1094 | Singapore | Cited to make a case that an entire agreement clause does not exclude extrinsic evidence for the purposes of contractual interpretation. |
| Y.E.S. F&B Group Pte Ltd v Soup Restaurant Singapore Pte Ltd (formerly known as Soup Restaurant (Causeway Point) Pte Ltd) | Court of Appeal | Yes | [2015] 5 SLR 1187 | Singapore | Cited for the principles on contractual interpretation. |
| CRW Joint Operation v PT Perusahaan Gas Negara (Persero) TBK | High Court | Yes | [2011] 4 SLR 305 | Singapore | Cited for the principle that the court has to determine whether there has been any real or actual prejudice caused to either or both of the parties. |
| Deutsche Schachbau v Shell International Petroleum Co Ltd | Court of Appeal | Yes | [1987] 2 Lloyds’ Rep 246 | England and Wales | Cited for the definition of public policy under the International Arbitration Act. |
| Parsons & Whittemore Overseas Co Inc v Societe Generale de L’Industrie du Papier (RAKTA) | United States Court of Appeals for the Second Circuit | Yes | 508 F 2d 969 (2nd Cir, 1974) | United States | Cited for the definition of public policy under the International Arbitration Act. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| International Arbitration Act (Cap 143A, 2002 Rev Ed) | Singapore |
| International Arbitration Act (Cap 143A, 2002 Rev Ed) s 19 | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Memorandum of Agreement
- Deposit
- Term Commitment Letter
- Grant of Loan Facilities
- Entire Agreement Clause
- Vessels
- Final Funding Deadline
15.2 Keywords
- arbitration
- contract
- vessel
- sale
- deposit
- natural justice
- enforcement
- agreement
16. Subjects
- Arbitration
- Contract Law
- Maritime Law
- Sale of Goods
17. Areas of Law
- Arbitration Law
- Contract Law
- Maritime Law