CBX v CBZ: Setting Aside Arbitration Awards for Exceeding Jurisdiction and Public Policy

CBX and CBY, the Plaintiffs, applied to the Singapore International Commercial Court to set aside parts of two Partial Awards and a Final Award (Costs) by the same tribunal against CBZ, CCA, and CCB, the Defendants. The Plaintiffs argued that the tribunal exceeded its jurisdiction, failed to provide a reasonable opportunity to present their case, and contravened Singapore public policy regarding the Remaining Amounts and Compound Interest Orders. Anselmo Reyes IJ dismissed the setting aside applications, finding that the payment of Remaining Amounts was in issue, there was no unfair prejudice, and no denial of natural justice. The court also found no contravention of Singapore public policy regarding the Compound Interest Orders. The challenge to the Costs Award also failed.

1. Case Overview

1.1 Court

Singapore International Commercial Court

1.2 Outcome

Plaintiffs' setting aside applications are dismissed.

1.3 Case Type

Civil

1.4 Judgment Type

Judgment

1.5 Jurisdiction

Singapore

1.6 Description

Singapore court dismisses application to set aside arbitration awards, finding no excess of jurisdiction or violation of public policy.

1.7 Decision Date

15 July 2020

2. Parties and Outcomes

Party Name	Role	Type	Outcome	Outcome Type	Counsels
CBX	Plaintiff	Corporation	Application Dismissed	Lost	Alvin Yeo, Lin Weiqi Wendy, Chong Wan Yee Monica, Huang Meizhen Margaret, Kara Quek Tze-Min
CBY	Plaintiff	Corporation	Application Dismissed	Lost	Alvin Yeo, Lin Weiqi Wendy, Chong Wan Yee Monica, Huang Meizhen Margaret, Kara Quek Tze-Min
CBZ	Defendant	Corporation	Judgment upheld	Won	Francis Xavier, Disa Sim, David Isidore Tan Huang Loong, Kristin Ng
CCA	Defendant	Corporation	Judgment upheld	Won	Francis Xavier, Disa Sim, David Isidore Tan Huang Loong, Kristin Ng
CCB	Defendant	Corporation	Judgment upheld	Won	Francis Xavier, Disa Sim, David Isidore Tan Huang Loong, Kristin Ng

3. Judges

Judge Name	Title	Delivered Judgment
Anselmo Reyes	International Judge	Yes

4. Counsels

Counsel Name	Organization
Alvin Yeo	WongPartnership LLP
Lin Weiqi Wendy	WongPartnership LLP
Chong Wan Yee Monica	WongPartnership LLP
Huang Meizhen Margaret	WongPartnership LLP
Kara Quek Tze-Min	WongPartnership LLP
Francis Xavier	Rajah & Tann LLP
Disa Sim	Rajah & Tann LLP
David Isidore Tan Huang Loong	Rajah & Tann LLP
Kristin Ng	Rajah & Tann LLP

4. Facts

CBX and CBY entered into Sale and Purchase Agreements (SPAs) with CBZ, CCA, and CCB to buy shares of AAA.
The SPAs were governed by Thai law and provided for ICC arbitration in Singapore.
Disputes arose regarding payment of the first installments and Remaining Amounts under the SPAs.
The Defendants commenced arbitration against the Plaintiffs, claiming default and seeking accelerated payment.
The Plaintiffs raised set-offs and counterclaims for damages arising from the Defendants’ actions.
The Tribunal issued Phase I Partial Awards and later Phase II Partial Awards and a Costs Award.
The Plaintiffs applied to set aside parts of the Phase II Partial Awards and the Costs Award.

5. Formal Citations

CBX and another v CBZ and others, Originating Summons No 1 of 2020, [2020] SGHC(I) 17

6. Timeline

Date	Event
2015-06-19	Sale and Purchase Agreements (SPAs) signed between Plaintiffs and Defendants.
2015-07-27	Closing date of the CBY SPA.
2015-08-24	Closing date of the CBX SPA.
2015-09-25	Original deadline for the first instalment under the CBY SPA.
2015-10-23	Original deadline for the first instalment under the CBX SPA.
2015-11-30	CBY paid part of the first instalment under the CBY SPA.
2015-12-29	CBY paid part of the first instalment under the CBY SPA.
2016-01-26	CBZ commenced arbitration against CBX.
2016-03-25	CCA and CCB instituted proceedings against CBY.
2017-01-26	Thai court ruling issued regarding misuse of ALRO-leased land.
2017-06-23	Thailand’s National Council for Peace and Order passed Order No. 31/2560.
2017-09-22	Tribunal issued Phase I Partial Awards.
2017-12-29	Ministerial regulations issued.
2018-02-01	BBB applied for new leases.
2018-08-30	Phase II substantive hearing took place.
2018-08-31	Phase II substantive hearing took place.
2018-09-01	Phase II substantive hearing took place.
2018-09-04	Phase II substantive hearing took place.
2018-09-28	A2 reached Commercial Operation Date.
2018-09-28	A3 reached Commercial Operation Date.
2018-09-26	Plaintiffs commenced ALRO arbitration.
2018-11-05	Plaintiffs’ Phase II Post-Hearing Reply.
2018-11-23	A1 reached Commercial Operation Date.
2018-12-28	A5 reached Commercial Operation Date.
2019-03-14	A4 reached Commercial Operation Date.
2019-05-30	Phase II formally closed.
2019-06-05	Tribunal issued the Phase II Partial Awards.
2019-06-28	Defendants applied to the Tribunal for a correction of the Compound Interest Orders.
2019-08-05	Tribunal issued Correction Decision.
2019-08-09	Tribunal issued the Costs Award.
2020-06-15	Judgment reserved.
2020-07-16	Judgment date.

7. Legal Issues

Excess of Jurisdiction
- Outcome: The court found that the Tribunal did not exceed its jurisdiction in making the Remaining Amounts Orders.
- Category: Jurisdictional
Denial of Natural Justice
- Outcome: The court disagreed that there had been a denial of natural justice.
- Category: Procedural
Contravention of Public Policy
- Outcome: The court disagreed that allowing the Compound Interest Orders to stand would be repugnant to Singapore public policy.
- Category: Substantive

8. Remedies Sought

Setting aside of arbitration awards
Order for Defendants to pay 100% of Plaintiffs’ costs of the arbitration proceedings

9. Cause of Actions

Breach of Contract

10. Practice Areas

Arbitration
Commercial Litigation

11. Industries

No industries specified

12. Cited Cases

Case Name	Court	Affirmed	Citation	Jurisdiction	Significance
AKN and another v ALC and others and other appeals	Court of Appeal	Yes	[2016] 1 SLR 966	Singapore	Cited regarding the 'extended' doctrine of res judicata and preclusion of re-opening matters that could and should have been raised in earlier proceedings.
Lesotho Highlands Development Authority v Impregilo SpA and others	N/A	Yes	[2006] 1 AC 221	N/A	Cited to distinguish between a tribunal purporting to exercise a power it did not have and erroneously exercising a power it did have.
Soleimany v Soleimany	Court of Appeal	Yes	[1999] QB 785	England	Cited regarding the enforcement of arbitration awards and the consideration of illegality of the underlying contract.
AJU v AJT	Court of Appeal	Yes	[2011] 4 SLR 739	Singapore	Cited regarding setting aside an interim award on the ground that the tribunal had wrongly held that a Concluding Agreement was legal and enforceable.
Westacre Investments Inc. v. Jugoimport-SPDR Holding Co. Ltd.	N/A	Yes	[1999] QB 740	N/A	Cited regarding the principle of 'palpable and indisputable illegality' in the context of enforcing contracts.
Omnium de Traitement et de Valorisation SA v Hilmarton Ltd	N/A	Yes	[1999] 2 Lloyd’s Rep 222	N/A	Cited to distinguish Soleimany, noting that Soleimany involved an illicit enterprise for smuggling carpets.
PT Asuransi Jasa Indonesia (Persero) v Dexia Bank SA	N/A	Yes	[2007] 1 SLR(R) 597	N/A	Cited regarding the narrow scope of 'public policy' in the New York Convention and the Model Law.
Company A and others v Company D and others	N/A	Yes	[2019] HKCFI 367	Hong Kong	Cited as an example of enforcement of awards in other jurisdictions.
Amaltal Corporation Ltd v Maruha (NZ) Corporation Ltd	N/A	Yes	[2004] 2 NZLR 614	New Zealand	Cited regarding the setting aside of awards contrary to New Zealand 'public policy'.
GD Midea Air Conditioning Equipment Co Ltd v Tornado Consumer Goods Ltd and another matter	N/A	Yes	[2018] 4 SLR 271	Singapore	Cited regarding the setting aside of other parts of an award where part of an award has been set aside.
Kingdom of Lesotho v Swissbourgh Diamond Mines (Pty) Ltd and others	N/A	Yes	[2019] 3 SLR 12	Singapore	Cited regarding the power to award costs of an arbitration.
CRW Joint Operation v PT Perusahaan Gas Negara (Persero) TBK	Court of Appeal	Yes	[2011] 4 SLR 305	Singapore	Cited regarding the direction of costs and disbursements incurred in arbitration.

13. Applicable Rules

Rule Name
International Chamber of Commerce Rules of Arbitration 2012

14. Applicable Statutes

Statute Name	Jurisdiction
International Arbitration Act (Cap 143A, 2002 Rev Ed)	Singapore
Agricultural Land Reform Act B.E. 2518 (1975)	Thailand

15. Key Terms and Keywords

15.1 Key Terms

Sale and Purchase Agreement
Arbitration
Remaining Amounts
Compound Interest
Commercial Operation Date
Agricultural Land Reform Office
Thai court ruling
ALRO arbitration
Res judicata

15.2 Keywords

arbitration
setting aside
jurisdiction
public policy
contract law
Singapore International Commercial Court

16. Subjects

Arbitration
Contract Law
Civil Procedure

17. Areas of Law

Arbitration Law
Contract Law
Civil Procedure