CNQ v CNR: Setting Aside Arbitration Award for Non-Acceptance of Goods
In CNQ v CNR, the Singapore High Court dismissed an application by CNQ (the Buyer) to set aside an arbitration award in favor of CNR (the Seller) for non-acceptance of goods. The court, presided over by Justice Andre Maniam, found no grounds to set aside the award, rejecting claims of inability to present a case, breach of natural justice, and excess of jurisdiction. The primary legal issue revolved around the application of Section 50 of the Sale of Goods Act regarding damages for non-acceptance, specifically whether the tribunal erred in applying Section 50(3) despite the Seller's initial claim under Section 50(2). The court upheld the tribunal's decision, finding that the Buyer had a fair opportunity to present its case and suffered no prejudice.
1. Case Overview
1.1 Court
General Division of the High Court of the Republic of Singapore1.2 Outcome
Setting-aside application dismissed.
1.3 Case Type
Arbitration
1.4 Judgment Type
Judgment
1.5 Jurisdiction
Singapore
1.6 Description
Singapore High Court dismisses application to set aside arbitration award. The key legal issue was damages for non-acceptance of goods.
1.7 Decision Date
2. Parties and Outcomes
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Andre Maniam | Judge of the High Court | Yes |
4. Counsels
4. Facts
- The Buyer was found liable in arbitration for non-acceptance of goods under a sale and purchase contract.
- The Buyer sought to set aside the damages awarded, but did not challenge its liability for breach of contract.
- The Buyer complained that the tribunal awarded damages based on s 50(3) of the Sale of Goods Act.
- The Seller's primary relief sought was the price of the goods, under s 49 of the Sale of Goods Act, but the tribunal found against the Seller on this.
- The Seller succeeded in its alternative claim for damages under s 50 of the Sale of Goods Act.
- The goods in question are optical fiber preforms, rods made of synthetic quartz doped with germanium.
- The tribunal found the Buyer to be in breach of contract, in its non-acceptance of shipments of Preforms in the period from February to December 2019.
5. Formal Citations
- CNQ v CNR, Originating Summons No 511 of 2021, [2021] SGHC 287
6. Timeline
| Date | Event |
|---|---|
| Buyer failed to accept shipments of Preforms. | |
| Buyer failed to accept shipments of Preforms. | |
| Seller filed request for arbitration. | |
| Terms of reference established. | |
| Hearing of the setting-aside application. | |
| Hearing of the setting-aside application. | |
| Judgment reserved. |
7. Legal Issues
- Setting Aside Arbitration Award
- Outcome: The court dismissed the application to set aside the arbitration award.
- Category: Procedural
- Sub-Issues:
- Inability to present case
- Breach of natural justice
- Excess of jurisdiction
- Damages for Non-Acceptance of Goods
- Outcome: The court found that the tribunal did not err in its application of Section 50 of the Sale of Goods Act and upheld the damages awarded.
- Category: Substantive
- Sub-Issues:
- Application of Section 50(2) vs 50(3) of Sale of Goods Act
- Availability of market for goods
- Mitigation of damages
8. Remedies Sought
- Setting Aside of Arbitration Award
- Damages
9. Cause of Actions
- Breach of Contract
10. Practice Areas
- Arbitration
- Commercial Litigation
11. Industries
- Manufacturing
- Telecommunications
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Soh Beng Tee & Co Pte Ltd v Fairmount Development Pte Ltd | Court of Appeal | Yes | [2007] 3 SLR(R) 86 | Singapore | Cited for the principle that an arbitral award should be read supportively to uphold it rather than destroy it. |
| 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 the court should not nit-pick at an arbitral award. |
| Avra Commodities Pte Ltd v China Coal Solution (Singapore) Pte Ltd | High Court | Yes | [2019] SGHC 287 | Singapore | Cited as a case where damages were awarded under Section 50(3) of the Sale of Goods Act, using the market price of a comparable product. |
| CDM and another v CDP | Court of Appeal | Yes | [2021] 2 SLR 235 | Singapore | Cited for the principle that the notice of arbitration and statement of claim do not exhaustively define the jurisdiction of the tribunal. |
| CAJ and another v CAI and another appeal | Court of Appeal | Yes | [2021] SGCA 102 | Singapore | Cited to clarify that new claims cannot be introduced only at the stage of closing submissions. |
| AKN and another v ALC and others and other appeals | Court of Appeal | Yes | [2015] 3 SLR 488 | Singapore | Cited for the principle that a generic claim for damages is broad enough to encompass a claim that might be characterised as one for a loss of chance. |
| China Machine New Energy Corp v Jaguar Energy Guatemala LLC and another | Court of Appeal | Yes | [2020] 1 SLR 695 | Singapore | Cited for the principle that a court should evaluate the tribunal’s conduct of the proceedings and ask if it falls within the range of what a reasonable and fair-minded tribunal might have done. |
| BTN and another v BTP and another and other matters | High Court | Yes | [2021] SGHC 271 | Singapore | Cited for the principle that the affidavit in support served with the originating summons must reasonably contain all the facts, evidence and grounds relied upon in support of an application to set aside an award. |
| 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 principle that to justify setting-aside under s 24(b) of the IAA the rights of the Buyer must have been prejudiced by the breach of natural justice. |
| CRW Joint Operation v PT Perusahaan Gas Negara (Persero) TBK | Court of Appeal | Yes | [2011] 4 SLR 305 | Singapore | Cited for the principle that the absence of prejudice remains a relevant consideration when the court decides whether to set aside an award. |
| Front Row Investment Holdings (Singapore) Pte Ltd v Daimler South East Asia Pte Ltd | High Court | Yes | [2010] SGHC 80 | Singapore | Cited as a case where the tribunal failed to consider a number of the points pleaded, because it thought the respondent had ceased to rely on them. |
| CIX v CIY | High Court | Yes | [2021] SGHC 53 | Singapore | Cited for the principle that an inference that the tribunal had failed to consider the Buyer’s contentions must be shown to be clear and virtually inescapable. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Sale of Goods Act (Cap 383, 1999 Rev Ed) | Singapore |
| International Arbitration Act (Cap 143A, 2002 Rev Ed) | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Optical fiber preforms
- Non-acceptance of goods
- Setting aside application
- Available market
- Hypothetical Market Price
- Section 50(3) of the Sale of Goods Act
- Section 50(2) of the Sale of Goods Act
- Breach of natural justice
- Excess of jurisdiction
- Mitigation of damages
15.2 Keywords
- Arbitration
- Sale of Goods Act
- Damages
- Non-acceptance
- Setting aside
- Singapore
- Commercial dispute
17. Areas of Law
| Area Name | Relevance Score |
|---|---|
| Recourse against award | 80 |
| Arbitration | 75 |
| Sale of Goods | 70 |
| Non-acceptance of goods | 65 |
| Contract Law | 60 |
| Breach of Contract | 60 |
| Damages Assessment | 50 |
| Commercial Law | 50 |
| Performance of Contract | 40 |
| Natural justice | 40 |
| Jurisdiction | 30 |
16. Subjects
- Arbitration
- Contract Law
- Commercial Law
- Sale of Goods