COD v COE: Setting Aside Arbitration Award for Breach of Natural Justice

In COD v COE, the Singapore High Court dismissed COD's application to set aside a final arbitration award. COD, a shipbuilder, argued that the arbitrator breached natural justice and deviated from agreed procedure by considering a claim for damages (balance contract price less scrap value) that was allegedly introduced late and by bifurcating the proceedings. The court found that the damages claim was sufficiently foreshadowed before the evidentiary hearing and that the arbitrator's actions did not constitute a procedural breach. The court dismissed COD's application in its entirety.

1. Case Overview

1.1 Court

General Division of the High Court of the Republic of Singapore

1.2 Outcome

Application to set aside the final award dismissed in its entirety.

1.3 Case Type

Arbitration

1.4 Judgment Type

Judgment

1.5 Jurisdiction

Singapore

1.6 Description

Singapore High Court dismisses COD's application to set aside an arbitration award, finding no breach of natural justice or agreed procedure.

1.7 Decision Date

24 May 2022

2. Parties and Outcomes

Party Name	Role	Type	Outcome	Outcome Type	Counsels
COD	Applicant	Corporation	Application Dismissed	Lost	Chan Leng Sun SC of Chan Leng Sun LLC Rachel Low Tze-Lynn of Rachel Low LLC Kwek Choon Lin Winston of Rajah & Tann Singapore LLP Lim Zhi Ming, Max of Rajah & Tann Singapore LLP
COE	Respondent	Corporation	Application to Set Aside Dismissed	Won	Tan Boon Yong Thomas of Haridass Ho & Partners Benjamin Tan Ren Jie of Haridass Ho & Partners

3. Judges

Judge Name	Title	Delivered Judgment
Philip Jeyaretnam	Judge of the High Court	Yes

4. Counsels

Counsel Name	Organization
Chan Leng Sun SC	Chan Leng Sun LLC
Rachel Low Tze-Lynn	Rachel Low LLC
Kwek Choon Lin Winston	Rajah & Tann Singapore LLP
Lim Zhi Ming, Max	Rajah & Tann Singapore LLP
Tan Boon Yong Thomas	Haridass Ho & Partners
Benjamin Tan Ren Jie	Haridass Ho & Partners

4. Facts

COD and COE entered into contracts for the making and delivery of two fibre rope cranes.
COD terminated the contracts, alleging non-compliance with contractual specifications.
COE commenced arbitration proceedings, claiming specific performance or, alternatively, damages.
The arbitrator issued an interim award finding COD's termination wrongful.
The arbitrator invited further submissions on the quantum of damages.
COD objected to COE's claim for damages based on the purchase price less scrap value, arguing it was not pleaded.
The arbitrator awarded damages to COE based on the purchase price less scrap value.

5. Formal Citations

COD v COE, Originating Summons No 925 of 2021, [2022] SGHC 126

6. Timeline

Date	Event
2015-11-06	COE commenced two arbitrations alleging breach of contract.
2017-10-06	COE’s consultant filed witness statement in the arbitration.
2017-10-17	COE’s consultant was cross-examined.
2018-02-05	COD's witnesses gave evidence.
2019-09-16	Parties exchanged closing submissions.
2019-11-15	Parties exchanged reply submissions.
2020-04-28	Arbitrator issued an interim award.
2020-06-10	Memorandum of Corrections was issued.
2020-07-20	COD stated that the arbitrator had no right to direct an assessment.
2020-07-21	Arbitrator responded to COD's position.
2020-08-28	COD and COE filed submissions on damages and costs.
2020-09-01	COD objected to COE’s claim for the purchase price less part-payments.
2020-12-09	Hearing for oral submissions took place.
2021-02-15	Final round of post-hearing submissions followed.
2021-06-21	Arbitrator issued his final award.
2021-09-10	COD filed its application to set aside the whole of the final award.
2021-09-30	AR gave directions extending time for COE to file its reply affidavit.
2022-01-13	AR rejected COD’s request to file a third affidavit.
2022-03-12	COD applied for leave to file that third affidavit.
2022-04-13	Hearing of the setting aside application.
2022-04-14	Hearing of the setting aside application.
2022-05-25	Judgment reserved.

7. Legal Issues

Breach of Natural Justice
- Outcome: The court found no breach of natural justice.
- Category: Procedural
- Sub-Issues:
  - Failure to provide a fair opportunity to respond to a claim
  - Failure to consider arguments
Deviation from Agreed Arbitral Procedure
- Outcome: The court found no deviation from the agreed arbitral procedure.
- Category: Procedural
- Sub-Issues:
  - Unilateral bifurcation of proceedings

8. Remedies Sought

Setting aside of final arbitration award

9. Cause of Actions

Breach of Contract

10. Practice Areas

Arbitration
Commercial Litigation

11. Industries

Construction
Maritime

12. Cited Cases

Case Name	Court	Affirmed	Citation	Jurisdiction	Significance
Lee Chee Wei v Tan Hor Peow Victor and others and another appeal	Court of Appeal	Yes	[2007] 3 SLR(R) 537	Singapore	Cited regarding assessment of damages in lieu of specific performance when the plaintiff did not put in evidence of damages during trial.
Anglo-Cyprian Trade Agencies Ltd v Paphos Wine Industries Ltd	English Court	Yes	[1951] 1 All ER 873	England	Cited regarding pleading special damages and setting up a lower figure in court.
Perestrello e Companhia Limitada v United Paint Co Ltd	English Court of Appeal	Yes	[1969] 1 WLR 570	England	Cited regarding the sufficiency of a statement claiming 'damages' to allow evidence of a particular kind of loss.
The “Shravan”	High Court	Yes	[1999] 2 SLR(R) 713	Singapore	Cited regarding pleading an alternative method of calculating loss of revenue and the granting of leave to adduce additional evidence.
AKN and another v ALC and others and other appeals	Court of Appeal	Yes	[2015] 3 SLR 488	Singapore	Cited regarding the introduction of a new basis for claiming damages without giving the opportunity for submissions or evidence.
Phoenixfin Pte Ltd and others v Convexity Ltd	Court of Appeal	Yes	[2022] SGCA 17	Singapore	Cited regarding setting aside an arbitral award for failure to adhere to an agreed arbitral procedure.
GD Midea Air Conditioning Equipment Co Ltd v Tornado Consumer Goods Ltd and another matter	High Court	Yes	[2018] 4 SLR 271	Singapore	Cited regarding the requirements for setting aside an arbitral award based on failure to adhere to an agreed procedure.
PT Prima International Development v Kempinski Hotels SA and other appeals	Court of Appeal	Yes	[2012] 4 SLR 98	Singapore	Cited regarding ample notice of a new point in a case.
Soh Beng Tee & Co Pte Ltd v Fairmont Development Pte Ltd	Court of Appeal	Yes	[2007] 3 SLR(R) 86	Singapore	Cited regarding reading awards generously and not microscopically.
CAJ and another v CAI and another appeal	Court of Appeal	Yes	[2022] 1 SLR 505	Singapore	Cited regarding claims introduced in written closing submissions.

13. Applicable Rules

Rule Name
Arbitration Rules of the Singapore International Arbitration Centre (5th Ed, 1 April 2013)

14. Applicable Statutes

Statute Name	Jurisdiction
Arbitration Act (Cap 10, 2002 Rev Ed)	Singapore

15. Key Terms and Keywords

15.1 Key Terms

Arbitration
Natural Justice
Setting Aside Award
Breach of Contract
Specific Performance
Damages
Fibre Rope Cranes
Scrap Value
Bifurcation
Interim Award

15.2 Keywords

arbitration
award
setting aside
natural justice
singapore
contract
damages

17. Areas of Law

Area Name	Relevance Score
Natural justice	90
Recourse against award	80
Arbitration	75
Setting aside	70
Damages	70
Breach of Contract	60
Contract Law	60
Contractual terms	50
Shipping Law	40
Performance of Contract	40

16. Subjects

Arbitration
Contract Law
Civil Procedure