CJY v CJZ: Stay of Court Proceedings Pending Arbitration Over Wrongful Performance Bond Calls and Construction Defects
In CJY v CJZ, the Singapore High Court addressed whether a contractor should be allowed to pursue court proceedings against the employer's head of finance, quantity surveyors, and architects while arbitration was underway between the contractor (CJY) and the employer (CJZ and others) regarding issues in dispute. The court upheld the Registrar's decision to grant a stay of the court proceedings pending the arbitration's determination, emphasizing the overlap in parties, issues, and remedies between the two proceedings. The court found that the issues in the suit, including the wrongful calls on performance bonds and responsibility for construction defects, were also central to the arbitration. The court concluded that allowing the suit to proceed in parallel with the arbitration would be inefficient and unfair, and that the arbitration should be resolved first.
1. Case Overview
1.1 Court
General Division of the High Court1.2 Outcome
Case management stay granted, suit stayed pending the determination of the arbitration.
1.3 Case Type
Civil
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
Singapore High Court case regarding a stay of court proceedings pending arbitration between a contractor and employer over wrongful calls on performance bonds.
1.7 Decision Date
2. Parties and Outcomes
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Andre Maniam | Judicial Commissioner | Yes |
4. Counsels
4. Facts
- A construction company (plaintiff) was engaged for a construction project.
- The contract between the plaintiff and the employer provided for disputes to be resolved in arbitration.
- The employer obtained three performance bonds in connection with the project.
- The architects issued a schedule of defects to the plaintiff.
- The employer called on the performance bonds and received payment.
- The plaintiff commenced arbitration against the employer, asserting that the calls were wrongful.
- The plaintiff commenced a suit against the employer's head of finance, quantity surveyors, and architects, alleging bad faith and collusion.
5. Formal Citations
- CJY v CJZ and others, Suit No 990 of 2020 (Registrar’s Appeal No 11 of 2021), [2021] SGHC 69
6. Timeline
| Date | Event |
|---|---|
| Architects issued a schedule of defects to the plaintiff. | |
| Employer called on the Performance Bonds. | |
| Architect issued an architect’s direction to which the schedule of defects was appended. | |
| Plaintiff commenced arbitration against the Employer. | |
| Settlement was reached between the plaintiff and the Employer and the appeal was withdrawn. | |
| Plaintiff filed its Statement of Case in the Arbitration. | |
| Employer filed its Defence and Counterclaim in the Arbitration. | |
| Plaintiff filed its Reply and Defence to Counterclaim in the Arbitration. | |
| Plaintiff commenced the suit against the defendants. | |
| Arguments heard. | |
| Plaintiff filed Notice of Appeal to the Court of Appeal. | |
| Judgment delivered. |
7. Legal Issues
- Stay of Court Proceedings
- Outcome: The court granted a stay of the court proceedings pending the determination of the arbitration.
- Category: Procedural
- Related Cases:
- [2016] 1 SLR 373
- [2019] 2 SLR 682
- Wrongful Calls on Performance Bonds
- Outcome: The court did not make a determination on whether the calls were wrongful, as that issue was to be decided in arbitration.
- Category: Substantive
- Confidentiality in Arbitration
- Outcome: The court held that the obligation of confidentiality in relation to arbitrations is not absolute and that disclosure is permissible where it is reasonably necessary or where it is in the interests of justice.
- Category: Procedural
- Related Cases:
- [2003] 2 SLR(R) 547
- [2008] 2 All ER (Comm) 193
- [2011] 1 SLR 1093
8. Remedies Sought
- Damages to be assessed
- Interest
- Costs
- Further or other relief
9. Cause of Actions
- Conspiracy
- Breach of duties
- Deceit
- Unlawful interference with trade and/or contractual relations
10. Practice Areas
- Arbitration
- Commercial Litigation
- Construction Law
11. Industries
- Construction
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Tomolugen Holdings Ltd and another v Silica Investors Ltd and other appeals | Court of Appeal | Yes | [2016] 1 SLR 373 | Singapore | Cited for the principle that the court may exercise its case management powers to ensure the efficient and fair resolution of a dispute where there are overlapping court and arbitration proceedings. |
| Rex International Holding Ltd and another v Gulf Hibiscus Ltd | Court of Appeal | Yes | [2019] 2 SLR 682 | Singapore | Cited for the principle that the court will consider the extent and nature of overlap between the arbitration and the suit, in terms of the parties, the issues, and the remedies. |
| Goh Nellie v Goh Lian Teck and others | N/A | Yes | [2007] 1 SLR(R) 453 | Singapore | Cited for the principle that a party cannot procure an outcome from the court that is opposite to a final and binding arbitration award against that party; doing so would be an impermissible collateral attack on the arbitration award and an abuse of process. |
| Lim Geok Lin Andy v Yap Jin Meng Bryan and another appeal | N/A | Yes | [2017] 2 SLR 760 | Singapore | Cited for the principle that a party cannot procure an outcome from the court that is opposite to a final and binding arbitration award against that party; doing so would be an impermissible collateral attack on the arbitration award and an abuse of process. |
| Ong Han Nam v Borneo Ventures Pte Ltd | Singapore Court of Appeal | Yes | [2021] SGCA 21 | Singapore | Cited for the principle that a party cannot procure an outcome from the court that is opposite to a final and binding arbitration award against that party; doing so would be an impermissible collateral attack on the arbitration award and an abuse of process. |
| Myanma Yaung Chi Oo Co Ltd v Win Win Nu and another | N/A | Yes | [2003] 2 SLR(R) 547 | Singapore | Cited for the principle that the obligation of confidentiality in relation to arbitrations is not an absolute one and that disclosure is permissible where it is reasonably necessary or where it is in the interests of justice. |
| John Forster Emmott v Michael Wilson & Partners Ltd | N/A | Yes | [2008] 2 All ER (Comm) 193 | N/A | Cited for the principle that the obligation of confidentiality in relation to arbitrations is not an absolute one and that disclosure is permissible where it is reasonably necessary for the protection of the legitimate interests of an arbitration party or where the interests of justice require disclosure. |
| AAY and others v AAZ | N/A | Yes | [2011] 1 SLR 1093 | Singapore | Cited for the principle that the obligation of confidentiality in relation to arbitrations is not an absolute one and that disclosure is permissible where it is reasonably necessary for the protection of the legitimate interests of an arbitration party or where the interests of justice require disclosure. |
| Tan Woo Thian v PricewaterhouseCoopers Advisory Services Pte Ltd | Singapore Court of Appeal | Yes | [2021] SGCA 20 | Singapore | Cited for the principle that liability cannot be determined in the plaintiff’s favour without a determination that the plaintiff has suffered damage. |
| CKR Contract Services Pte Ltd v Asplenium Land Pte Ltd | N/A | Yes | [2020] 5 SLR 665 | Singapore | Cited as an example where a stay of court proceedings pending the outcome of arbitration was granted. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Arbitration Act (Cap 10, 2002 Rev Ed) | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Arbitration
- Stay of proceedings
- Performance bond
- Schedule of defects
- Wrongful calls
- Case management stay
- Confidentiality
- Rectification costs
15.2 Keywords
- arbitration
- stay of proceedings
- performance bond
- construction
- Singapore
17. Areas of Law
16. Subjects
- Arbitration
- Construction Dispute
- Civil Procedure