CNQ v CNR: Setting Aside Arbitration Award for Non-Acceptance of Goods

In CNQ v CNR, the General Division of the High Court of Singapore heard an application by CNQ to set aside a second arbitration award in favor of CNR. The dispute arose from a sale and purchase contract for optical fiber preforms, where CNR claimed damages for CNQ's non-acceptance of goods. CNQ argued that the arbitrator failed to understand new evidence and contentions and prejudged the issues. The court, presided over by Justice Andre Maniam, dismissed the application, finding no breach of natural justice or prejudgment by the arbitrator. The judgment was delivered on 31 October 2022.

1. Case Overview

1.1 Court

General Division of the High Court of the Republic of Singapore

1.2 Outcome

Application dismissed

1.3 Case Type

Arbitration

1.4 Judgment Type

Judgment

1.5 Jurisdiction

Singapore

1.6 Description

The High Court dismissed CNQ's application to set aside an arbitration award, finding no failure by the arbitrator to understand new evidence or prejudgment.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
CNQClaimantCorporationApplication dismissedLost
CNRRespondentCorporationApplication dismissedWon

3. Judges

Judge NameTitleDelivered Judgment
Andre ManiamJudge of the High CourtYes

4. Counsels

Counsel NameOrganization
Devathas SatianathanRajah & Tann Singapore LLP
Tan Chuan ThyeRajah & Tann Singapore LLP
Timothy James Chong Wen AnRajah & Tann Singapore LLP
Tay Yong SengAllen & Gledhill LLP
Ang Ann LiangAllen & Gledhill LLP
Ng Si MingAllen & Gledhill LLP
Lim Wan Jen MelissaAllen & Gledhill LLP

4. Facts

  1. The parties were involved in two arbitrations before the same arbitrator.
  2. Both arbitrations involved claims by the Seller against the Buyer for non-acceptance of goods.
  3. The goods in question were optical fiber preforms.
  4. The arbitrator applied the same measure of damages in both arbitrations.
  5. The Buyer's application to set aside the First Award failed.
  6. The Buyer contended that the arbitrator failed to understand new evidence and contentions in the Second Arbitration.
  7. The Buyer also contended that the arbitrator prejudged the Second Arbitration.

5. Formal Citations

  1. CNQ v CNR, Originating Application No 51 of 2022, [2022] SGHC 267

6. Timeline

DateEvent
Judgment reserved
Judgment delivered

7. Legal Issues

  1. Setting Aside Arbitration Award
    • Outcome: The court found no grounds to set aside the arbitration award.
    • Category: Procedural
    • Sub-Issues:
      • Failure to consider evidence
      • Prejudgment
      • Breach of natural justice
  2. Breach of Contract
    • Outcome: The court did not directly rule on the breach of contract itself, but upheld the arbitrator's decision on damages.
    • Category: Substantive
    • Sub-Issues:
      • Non-acceptance of goods
      • Damages calculation
      • Mitigation of loss

8. Remedies Sought

  1. Setting aside of arbitration award

9. Cause of Actions

  • Breach of Contract

10. Practice Areas

  • Arbitration
  • Commercial Litigation

11. Industries

  • Manufacturing

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
CNQ v CNRHigh CourtYes[2021] SGHC 287SingaporeCited as the first award between the parties, the setting aside of which had failed.
TMM Division Maritima SA de CV v Pacific Richfield Marine Pte LtdCourt of AppealYes[2013] 4 SLR 972SingaporeCited for the principle that natural justice requires an arbitrator to attempt to understand the parties’ evidence and contentions.
Front Row Investment Holdings (Singapore) Pte Ltd v Daimler South East Asia Pte LtdHigh CourtYes[2010] SGHC 80SingaporeCited as an example where an award was set aside because the arbitrator failed to consider submissions on a pleaded point.
AKN and another v ALC and others and other appealsCourt of AppealYes[2015] 3 SLR 488SingaporeCited for the principle that an inference that an arbitrator failed to consider an important pleaded issue must be clear and virtually inescapable.
CIX v CIYHigh CourtYes[2021] SGHC 53SingaporeCited for the principle that an inference that an arbitrator failed to consider an important pleaded issue must be clear and virtually inescapable.
Timwin Construction v Façade InnovationsSupreme Court of New South WalesYes[2005] NSWSC 548AustraliaCited as an example where an adjudicator was found to have failed to attempt in good faith to exercise the power given to him.
BOI v BOJCourt of AppealYes[2018] 2 SLR 1156SingaporeCited for the rule against prejudgment, which prohibits a decision-maker from reaching a final decision before being aware of all relevant evidence and arguments.
W v AWHigh Court of Hong KongYes[2021] HKCFI 1707Hong KongCited as an example of successive arbitrations involving the same parties and similar issues.
CRW Joint Operation v PT Perusahaan Gas Negara (Persero) TBKCourt of AppealYes[2011] 4 SLR 305SingaporeCited for the principle that the absence of prejudice remains a relevant consideration when the court decides whether to set aside an award.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute NameJurisdiction
International Arbitration Act 1994Singapore

15. Key Terms and Keywords

15.1 Key Terms

  • Arbitration
  • Setting aside
  • Optical fiber preforms
  • Non-acceptance of goods
  • Hypothetical Market Price
  • Price Database
  • Mitigation
  • Prejudgment
  • Natural justice

15.2 Keywords

  • arbitration
  • setting aside
  • contract
  • optical fiber
  • preforms
  • Singapore

17. Areas of Law

Area NameRelevance Score
Recourse against award80
Arbitration75
Setting aside70
Natural justice40
Breach of Contract30
Contract Law30
Contractual terms25
Commercial Law20
Commercial Disputes20
Jurisdiction20
Civil Practice20
Damages20
Evidence20
Liquidated Damages15
Mistake10
Rescission10
Penalties10
Estoppel10

16. Subjects

  • Arbitration
  • Contract Law
  • Commercial Law