CJM v CJT: Recourse Against Arbitration Award for Dismissal of Earn-Out Payment Claim

Plaintiffs CJM, CJN, CJO, CJP, CJQ, CJR, and CJS sought recourse in the Singapore International Commercial Court against Defendant CJT regarding a Singapore International Arbitration Centre arbitration award. The plaintiffs challenged the dismissal of their claim for an Earn-Out Payment, alleging a failure to show that the defendant's breach caused actual loss. Anselmo Reyes IJ dismissed the plaintiffs' originating summons to set aside two paragraphs in the award and dismissed the plaintiffs’ application to amend their originating summons to set aside two further paragraphs.

1. Case Overview

1.1 Court

SINGAPORE INTERNATIONAL COMMERCIAL COURT

1.2 Outcome

Plaintiffs' Originating Summons to set aside two paragraphs in the Award is dismissed. The plaintiffs’ application to amend their Originating Summons to set aside two further paragraphs is likewise dismissed.

1.3 Case Type

Arbitration

1.4 Judgment Type

Judgment

1.5 Jurisdiction

Singapore

1.6 Description

Shareholders CJM seek recourse against an arbitration award dismissing their claim for an Earn-Out Payment due to a failure to prove actual loss. The court dismissed the application.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
CJMPlaintiffOtherApplication DismissedLost
CJNPlaintiffOtherApplication DismissedLost
CJOPlaintiffOtherApplication DismissedLost
CJPPlaintiffOtherApplication DismissedLost
CJQPlaintiffOtherApplication DismissedLost
CJRPlaintiffOtherApplication DismissedLost
CJSPlaintiffOtherApplication DismissedLost
CJTDefendantOtherJudgment for DefendantWon

3. Judges

Judge NameTitleDelivered Judgment
Anselmo ReyesInternational JudgeYes

4. Counsels

Counsel NameOrganization
Chia Xin Ran AlinaRajah & Tann Singapore LLP
Gani Hui Ying TracyRajah & Tann Singapore LLP
Francis Xavier s/o Subramaniam Xavier AugustineRajah & Tann Singapore LLP
Vergis S AbrahamProvidence Law Asia LLC
Zhuo JiaxiangProvidence Law Asia LLC
Asiyah binte Ahmad ArifProvidence Law Asia LLC

4. Facts

  1. Plaintiffs are shareholders of a company.
  2. Defendant entered into an agreement to purchase the plaintiffs’ shares in the Company.
  3. The Agreement provided for the defendant to purchase the remaining 40% of the Company in five parcels between 2017 and 2021.
  4. The consideration for the final parcel included an additional component known as the “Earn-Out Payment”.
  5. The Earn-Out Payment was to be based on the Company’s actual EBITDA in financial year (“FY”) 2021.
  6. In November 2017 the plaintiffs commenced the SIAC arbitration for anticipatory breach of the Agreement.
  7. The plaintiffs claimed damages for loss of the Earn-Out Payment.

5. Formal Citations

  1. CJM and others v CJT, Originating Summons No 5 of 2021, [2021] SGHC(I) 4

6. Timeline

DateEvent
Defendant entered into an agreement to purchase the plaintiffs’ shares in the Company.
Plaintiffs commenced SIAC arbitration for anticipatory breach of the Agreement.
Hearing date.
Judgment reserved.
Judgment date.

7. Legal Issues

  1. Recourse against award
    • Outcome: The court dismissed the plaintiffs' application for recourse against the arbitration award.
    • Category: Substantive
  2. Setting aside
    • Outcome: The court dismissed the plaintiffs' application to set aside the arbitration award.
    • Category: Substantive

8. Remedies Sought

  1. Setting aside of arbitration award

9. Cause of Actions

  • Breach of Contract

10. Practice Areas

  • Arbitration
  • Commercial Litigation

11. Industries

  • No industries specified

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
No cited cases

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute NameJurisdiction
No applicable statutes

15. Key Terms and Keywords

15.1 Key Terms

  • Arbitration
  • Award
  • Recourse
  • Setting aside
  • Earn-Out Payment
  • EBITDA
  • Anticipatory breach

15.2 Keywords

  • Arbitration
  • Award
  • Recourse
  • Setting aside
  • Earn-Out Payment
  • EBITDA
  • Anticipatory breach

17. Areas of Law

Area NameRelevance Score
Setting Aside Arbitral Award90
Recourse against award90
International Commercial Arbitration80
Arbitration75
UNCITRAL Model Law60
Contract Law40
Breach of Contract30
Commercial Law25
International Commercial Law20
Interpretation of Contracts20
Estoppel15
Breach of Contractual Warranties10
Construction of Contracts10
Interpretation of Contract10
Contractual Duties10
Breach of Contractual Terms10
Construction of Contract10
Contracts (Rights of Third Parties) Act10
Contractual Interpretation10
Interpretation of contractual terms10
Assignment Law5
Sham Agreements5
Illegality and public policy5
Contractual discretions5
Separability5
Waiver of objections5
Statutory Demand5
Setting aside5
Striking out5
Reliance Damages5
Burden of proof5
Extension of Time5
Issue Estoppel5
Offer5
Formation of contract5
Implied Terms5
Discharge5
Frustration5
Set-off5
Waiver5
Limitation5
Res Judicata5
Intention to create legal relations5
Reasonableness5
Incorporation by reference5
Implied term5
Interpretation5
Promissory estoppel5
Anticipatory Breach5
Specific performance5
Damages5
Mistake of fact5
Failure of consideration5
Administrative Law5
Alternative Dispute Resolution5
Appellate Litigation5
Appellate Practice5
Banking and Finance5
Building and Construction Contracts5
Business Law5
Business Litigation5
Chancery and Equity5
Civil Litigation5
Commercial Fraud5
Commercial Litigation5
Contracts5
Dispute Resolution5
Principles5
Civil Procedure5
Ratification5
Undisclosed Principal5
Apparent Authority5
Unilateral mistake rectification5
Subject to contract clause5
Certainty of terms5
Acquiescence5
Acknowledgment of Debt5
Quantum5
Amendments5
Running Account5
Remoteness of damage5
Lump sum contract5
Rules of construction5
Performance of Contract5
Variation5
Interest5
Repudiation of contract5
Acceptance5
Offer and Acceptance5
Repudiatory breach5
Winding Up5
Repudiation5
Performance Bond5
Commercial Disputes5
Inducement of Breach of Contract5
Mistake5
Rescission5
Evidence5
Proper Notice5
Provisional Award5
Submission to Jurisdiction5
Bills of Lading Act5
Switch Bills of Lading5
Bailment5
Wrongful arrest5
Oral contract5
Acknowledgment5
Total failure of consideration5
Guarantee5
Construction5
Contractual terms5

16. Subjects

  • Arbitration
  • Contract Law