CZT v CZU: Setting Aside Arbitral Award for Breach of Contract
CZT applied to the Singapore International Commercial Court to set aside an arbitral award issued in favor of CZU. The arbitration, seated in Singapore, concerned a breach of contract claim related to the delivery of defective material packages. The court, comprising Chua Lee Ming J, Dominique Hascher IJ, and Sir Jeremy Cooke IJ, dismissed CZT's application, finding no breach of natural justice or other grounds to set aside the award. The court held that the arbitral tribunal did not fail to consider critical arguments, nor did it base its conclusions on extraneous matters, and there was no apparent bias.
1. Case Overview
1.1 Court
Singapore International Commercial Court1.2 Outcome
Plaintiff's application dismissed.
1.3 Case Type
Arbitration
1.4 Judgment Type
Judgment
1.5 Jurisdiction
Singapore
1.6 Description
Application to set aside an arbitral award for breach of contract. The court dismissed the application, finding no breach of natural justice.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| CZT | Plaintiff | Corporation | Application Dismissed | Lost | Nair Suresh Sukumaran, Tan Tse Hsien, Bryan (Chen Shixian), Joel Wang Pinwen |
| CZU | Defendant | Corporation | Judgment for Defendant | Won | Koh Swee Yen, Claire Lim, Pang Yi Ching, Alessa, Teo Wei Kiat Samuel |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Chua Lee Ming | Judge of the High Court | Yes |
| Dominique Hascher | International Judge | No |
| Jeremy Cooke | International Judge | No |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Nair Suresh Sukumaran | PK Wong & Nair LLC |
| Tan Tse Hsien | PK Wong & Nair LLC |
| Bryan (Chen Shixian) | PK Wong & Nair LLC |
| Joel Wang Pinwen | PK Wong & Nair LLC |
| Koh Swee Yen | WongPartnership LLP |
| Claire Lim | WongPartnership LLP |
| Pang Yi Ching | WongPartnership LLP |
| Alessa | WongPartnership LLP |
| Teo Wei Kiat Samuel | WongPartnership LLP |
4. Facts
- The plaintiff entered into a contract with the defendant to deliver material packages.
- A third party (Contractor) was to use the material packages to construct products for the defendant.
- The defendant alleged that certain components of the material packages were defective.
- The defendant filed an action in Country D against the Contractor and the plaintiff.
- The claim against the plaintiff was dismissed due to lack of jurisdiction because of an arbitration agreement.
- The defendant commenced arbitration proceedings against the plaintiff in Singapore.
- The plaintiff applied to set aside the arbitral award.
5. Formal Citations
- CZT v CZU, Originating Summons No 1 of 2023, [2023] SGHC(I) 22
6. Timeline
| Date | Event |
|---|---|
| Arbitration conducted in accordance with the Rules of Arbitration of the International Chamber of Commerce 2017. | |
| Defendant commenced arbitration proceedings against the plaintiff. | |
| Procedural Order No 1 Amended. | |
| Final Award dated. | |
| ICC sent the Final Award to the parties. | |
| Dr Habegger sent a copy of his dissenting opinion to the parties’ lawyers. | |
| Prof Kim spoke to the defendant’s solicitor. | |
| Prof Kim spoke to the plaintiff’s solicitor. | |
| Plaintiff’s counsel disclosed the contents of Prof Kim’s call to the plaintiff’s solicitor. | |
| Prof Kim replied to the plaintiff’s counsel’s email. | |
| Plaintiff filed the application to set aside the Final Award. | |
| Plaintiff filed Summonses Nos 788 of 2023, 789 of 2023 and 790 of 2023. | |
| Proceedings were transferred to the Singapore International Commercial Court. | |
| The Production Applications were dismissed. | |
| Judgment reserved. | |
| Judgment. |
7. Legal Issues
- Breach of Natural Justice
- Outcome: The court found no breach of natural justice.
- Category: Procedural
- Sub-Issues:
- Failure to consider critical arguments
- Conclusions based on extraneous matters
- Apparent bias
- Excess of Jurisdiction
- Outcome: The court found that the arbitral tribunal did not exceed its jurisdiction.
- Category: Jurisdictional
- Apparent Bias
- Outcome: The court found no reasonable suspicion of bias.
- Category: Procedural
8. Remedies Sought
- Setting aside of arbitral award
9. Cause of Actions
- Breach of Contract
10. Practice Areas
- Arbitration
- Commercial Litigation
11. Industries
- No industries specified
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| CJA v CIZ | Singapore Court of Appeal | Yes | [2022] 2 SLR 557 | Singapore | Cited for the principle that an error of law or fact in the award does not amount to a breach of natural justice. |
| Coal & Oil Co LLC v GHCL Ltd | Singapore High Court | Yes | [2015] 3 SLR 154 | Singapore | Cited for the principle that challenges based on alleged breaches of natural justice are limited to egregious cases where the error is clear on the face of the record. |
| TMM Division Maritima SA de CV v Pacific Richfield Marine Pte Ltd | Singapore High Court | Yes | [2013] 4 SLR 972 | Singapore | Cited for the principle that challenges based on alleged breaches of natural justice are limited to egregious cases where the error is clear on the face of the record. |
| 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 challenge to an arbitration award as having contravened the rules of natural justice. |
| L W Infrastructure Pte Ltd v Lim Chin San Contractors Pte Ltd and another appeal | Singapore High Court | Yes | [2013] 1 SLR 125 | Singapore | Cited for the test of prejudice in breach of natural justice claims. |
| CKH v CKG and another matter | Singapore Court of Appeal | Yes | [2022] 2 SLR 1 | Singapore | Cited for the principle that the failure by an arbitral tribunal to address an issue submitted to it for decision can constitute a breach of the fair hearing rule. |
| Front Row Investment Holdings (Singapore) Pte Ltd v Daimler South East Asia Pte Ltd | Singapore High Court | Yes | [2010] SGHC 80 | Singapore | Cited for the principle that the failure by an arbitral tribunal to address an issue submitted to it for decision can constitute a breach of the fair hearing rule. |
| AKN and another v ALC and others and other appeals | Singapore Court of Appeal | Yes | [2015] 3 SLR 488 | Singapore | Cited for the principle that the failure by an arbitral tribunal to address an issue submitted to it for decision can constitute a breach of the fair hearing rule. |
| BZW and another v BZV | Singapore High Court | Yes | [2022] 1 SLR 1080 | Singapore | Cited for the requirements of the tribunal’s chain of reasoning to comply with the fair hearing rule. |
| CYE v CYF | Singapore High Court | Yes | [2023] SGHC 275 | Singapore | Cited for the principle that an arbitral tribunal has to ensure that the essential issues are dealt with; it need not deal with each point made by a party. |
| BTN and another v BTP and another and other matters | Singapore High Court | Yes | [2022] 4 SLR 683 | Singapore | Cited for the principle that the application and supporting affidavit must inform the defendant of the specific grounds upon which the arbitral award is being challenged. |
| CFJ and another v CFL and another and other matters | Singapore Court of Appeal | Yes | [2023] 3 SLR 1 | Singapore | Cited for the distinction between the issue determined by a tribunal and the arguments of the parties on the issue in the context of excess of jurisdiction. |
| BOI v BOJ | Singapore Court of Appeal | Yes | [2018] 2 SLR 1156 | Singapore | Cited for the test for apparent bias. |
| CZT v CZU | Singapore International Commercial Court | No | [2023] SGHC(I) 11 | Singapore | Refers to the court's decision to dismiss the Production Applications. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| International Arbitration Act 1994 | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Arbitral award
- Breach of contract
- Natural justice
- Apparent bias
- Excess of jurisdiction
- Transfer Agreement
- Provisional Contract
- Material Packages
- ICC Rules 2017
- Dissenting opinion
15.2 Keywords
- arbitration
- breach of contract
- setting aside
- Singapore
- international commercial court
16. Subjects
- Arbitration
- Contract Law
- Civil Procedure
17. Areas of Law
- Arbitration Law
- Contract Law
- Civil Procedure