CLX v CLY: Setting Aside Arbitration Award for Fraud & Abuse of Process
In [2022] SGHC 17, the High Court of Singapore dismissed CLX's application in OS 433/2021 to set aside a final arbitration award in favor of CLY and CLZ, and CLX's application in SUM 2174/2021 to set aside the Leave Order made in OS 212/2021. CLX alleged fraud, breach of natural justice, and public policy violations, arguing that CLY concealed the damaged condition of overhead cranes. The court, presided over by S Mohan J, found no evidence of fraud, breach of natural justice, or public policy violation, and dismissed both applications.
1. Case Overview
1.1 Court
General Division of the High Court of the Republic of Singapore1.2 Outcome
Originating Summons No 433 of 2021 and Summons No 2174 of 2021 dismissed.
1.3 Case Type
Arbitration
1.4 Judgment Type
Judgment
1.5 Jurisdiction
Singapore
1.6 Description
CLX sought to set aside an arbitration award, alleging fraud by CLY. The court dismissed the application, finding no fraud or abuse.
1.7 Decision Date
2. Parties and Outcomes
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| S Mohan | Judge of the High Court | Yes |
4. Counsels
4. Facts
- CLX and CLY entered into a contract for the design, supply, and installation of overhead cranes.
- Disputes arose regarding whether the overhead cranes supplied by CLX were defective.
- CLY terminated the contract with CLX, claiming breaches and non-compliance.
- CLY commenced arbitration proceedings against CLX.
- CLX applied to set aside the final award, alleging fraud by CLY.
- CLX claimed CLY concealed the damaged condition of the overhead cranes.
- CLX argued it was deprived of the opportunity to defend against CLY's claim.
5. Formal Citations
- CLX v CLY and another and another matter, Originating Summons Nos 433 of 2021 and 212 of 2021 (Summons No 2174 of 2021), [2022] SGHC 17
6. Timeline
| Date | Event |
|---|---|
| Contract signed between CLX and CLY for overhead cranes. | |
| Sub-contract signed between CLX and CLZ. | |
| CLZ assigned its rights and obligations to CLY. | |
| CLY terminated the contract with CLX. | |
| Arbitration commenced by CLY against CLX. | |
| CLZ joined as a party to the Arbitration. | |
| Mr Christopher Lau SC appointed as the sole Arbitrator. | |
| Oral hearing of the Arbitration began. | |
| Oral hearing of the Arbitration concluded. | |
| Final Award rendered by the Arbitrator. | |
| CLX conducted a physical inspection of the Overhead Cranes. | |
| CLX submitted an application to the Registrar of the SIAC under r 33 of the SIAC Rules. | |
| Rule 33 Decision issued by the Arbitrator. | |
| CLY commenced OS 212 and obtained the Leave Order. | |
| Arguments heard in court. | |
| Judgment reserved. |
7. Legal Issues
- Setting Aside Arbitration Award
- Outcome: The court held that there was no basis to set aside the arbitration award.
- Category: Substantive
- Sub-Issues:
- Fraud
- Breach of Natural Justice
- Public Policy
- Fraud
- Outcome: The court found no strong and cogent evidence to prove that the award was induced or affected by fraud.
- Category: Substantive
- Sub-Issues:
- Deliberate Concealment
- False Representation
- Abuse of Process
- Outcome: The court held that the doctrine of approbation and reprobation did not apply to bar the plaintiff from seeking to set aside the award.
- Category: Procedural
- Sub-Issues:
- Inconsistent Positions
- Approbation and Reprobation
- Breach of Natural Justice
- Outcome: The court found no breach of the fair hearing rule.
- Category: Procedural
- Sub-Issues:
- Fair Hearing Rule
- Public Policy
- Outcome: The court found no basis to set aside the award on public policy grounds.
- Category: Substantive
- Sub-Issues:
- Violation of Morality and Justice
8. Remedies Sought
- Setting Aside of Arbitration Award
- Setting Aside of Leave Order
9. Cause of Actions
- Breach of Contract
- Fraud
10. Practice Areas
- Arbitration
- Commercial Litigation
11. Industries
- Construction
- Transportation
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| BAZ v BBA and others and other matters | Singapore Court of Appeal | Yes | [2020] 5 SLR 266 | Singapore | Cited for the principle that the court may dismiss objections raised belatedly in setting aside applications as an abuse of process. |
| BWG v BWF | Singapore Court of Appeal | Yes | [2020] 1 SLR 1296 | Singapore | Cited for the law on approbation and reprobation. |
| Evans v Bartlam | N/A | Yes | [1937] AC 473 | England and Wales | Cited as foundation of the doctrine of approbation and reprobation. |
| Treasure Valley Group Ltd v Saputra Teddy and another (Ultramarine Holdings Ltd, Intervener) | Singapore High Court | Yes | [2006] 1 SLR(R) 358 | Singapore | Cited for Belinda Ang Saw Ean J’s description of the doctrine of approbation and reprobation. |
| Aries Telecoms (M) Bhd v ViewQwest Pte Ltd | Singapore Court of Appeal | Yes | [2018] 1 SLR 108 | Singapore | Cited for the principle that a party’s election which gives rise to a prior position must still be reasonably clear to be effective. |
| R Durtnell & Sons Limited v Kaduna Limited | Technology and Construction Court (England and Wales) | Yes | [2003] EWHC 517 (TCC) | England and Wales | Cited for the definition of 'benefit' in the doctrine of approbation and reprobation. |
| AMEC Group Ltd v Thames Water Utilities Ltd | Technology and Construction Court (England and Wales) | No | [2010] EWHC 419 (TCC) | England and Wales | Cited as a case that doubted the correctness of Durtnell. |
| BNX v BOE | Singapore Court of Appeal | Yes | [2018] 2 SLR 215 | Singapore | Cited for the high threshold for establishing fraud and that dishonesty is the cornerstone for fraud. |
| Bloomberry Resorts and Hotels Inc and another v Global Gaming Philippines LLC and another | Singapore High Court | Yes | [2021] 3 SLR 725 | Singapore | Cited for the principles concerning perjury and concealment of evidence in arbitration. |
| BVU v BVX | Singapore High Court | Yes | [2019] SGHC 69 | Singapore | Cited for the principle that a convincing case of fraud must be shown. |
| Swiss Singapore Overseas Enterprises Pte Ltd v Exim Rajathi India Pvt Ltd | Singapore High Court | Yes | [2010] 1 SLR 573 | Singapore | Cited for the principle that non-disclosure must have been deliberate and aimed at deceiving the arbitrator. |
| Takhar v Gracefield Developments Ltd and others | UK Supreme Court | No | [2020] AC 450 | United Kingdom | Cited for the principle that there is no requirement that evidence of the fraud could not have been obtained in the earlier proceedings by exercise of reasonable diligence. |
| Ching Chew Weng Paul, deceased, and others v Ching Pui Sim and others | Singapore High Court | Yes | [2011] 3 SLR 869 | Singapore | Cited for the principle that the requirement of reasonable diligence ought not to be imposed rigidly such as to cause injustice in a situation where the fresh evidence uncovers fraud on the other party. |
| Soh Beng Tee & Co Pte Ltd v Fairmount Development Pte Ltd | Singapore Court of Appeal | Yes | [2007] 3 SLR(R) 86 | Singapore | Cited for the requirements to establish a breach of natural justice. |
| China Machine New Energy Corp v Jaguar Energy Guatemala LLC and another | Singapore Court of Appeal | Yes | [2020] 1 SLR 695 | Singapore | Cited for the approach to determine whether a party had been denied his right to a fair hearing. |
| AKN and another v ALC and others and other appeals | Singapore Court of Appeal | Yes | [2016] 1 SLR 966 | Singapore | Cited for the principle that the court may disallow a party to raise certain points in court which it could and should have raised in arbitration. |
| Denmark Skibstekniske Konsulenter A/S I Likvidation v Ultrapolis 3000 Investments Ltd | Singapore High Court | Yes | [2011] 4 SLR 997 | Singapore | Cited for the principle that the court may disallow a party to raise certain points in court which it could and should have raised in arbitration. |
| Dallal v Bank Mellat | N/A | Yes | [1986] QB 441 | England and Wales | Cited for the principle that the court may disallow a party to raise certain points in court which it could and should have raised in arbitration. |
| PT Asuransi Jasa Indonesia (Persero) v Dexia Bank SA | Singapore Court of Appeal | Yes | [2007] 1 SLR(R) 597 | Singapore | Cited for the test for setting aside an award on public policy grounds. |
| BLB and another v BLC and others | Singapore Court of Appeal | Yes | [2013] 4 SLR 1169 | Singapore | Cited for the egregious circumstances that would allow recourse to the public policy ground. |
| Management Corporation Strata Title Plan No 1166 v Chubb Singapore Pte Ltd | Singapore High Court | Yes | [1999] 2 SLR(R) 1035 | Singapore | Cited for the principle that damages for breach of contract may be awarded on the same basis as rescission. |
| Dongwoo Mann+Hummel Co Ltd v Mann+Hummel GmbH | Singapore High Court | Yes | [2008] 3 SLR(R) 871 | Singapore | Cited for the requirement that new evidence could not have been obtained with reasonable diligence. |
13. Applicable Rules
| Rule Name |
|---|
| Arbitration Rules of the Singapore International Arbitration Centre (6th Edition, 1 August 2016) |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Arbitration Act (Cap 10, 2002 Rev Ed) | Singapore |
| Sale of Goods Act (Cap 393, 1999 Rev Ed) | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Arbitration Award
- Setting Aside
- Fraud
- Abuse of Process
- Overhead Cranes
- Rescission
- Natural Justice
- Public Policy
- Approbation
- Reprobation
15.2 Keywords
- arbitration
- setting aside
- fraud
- abuse of process
- contract
- Singapore
17. Areas of Law
16. Subjects
- Arbitration
- Contract Law
- Civil Procedure