Navayo International AG v Ministry of Defence: Enforcement of Arbitral Award & Public Policy
Navayo International A.G. and MEHIB – Hungarian Export Credit Insurance Pte Ltd, the Plaintiffs, sought to enforce an arbitral award against the Ministry of Defence, Government of Indonesia, the Defendant, in the Singapore International Commercial Court. The MOD applied to set aside the enforcement order, for leave to file further affidavits, and for sealing and redaction orders. The court dismissed the MOD's application for an extension of time to file the setting-aside application, finding the application was filed out of time and that the MOD had not provided sufficient justification for the delay. Consequently, the court dismissed the MOD's application to set aside the enforcement order and declined to make any orders for sealing or redaction.
1. Case Overview
1.1 Court
Singapore International Commercial Court1.2 Outcome
Ministry of Defence, Government of Indonesia's application for an extension of time to file SUM 589 is dismissed.
1.3 Case Type
Civil
1.4 Judgment Type
Judgment
1.5 Jurisdiction
Singapore
1.6 Description
Singapore court dismisses Indonesia's MOD application to set aside enforcement of arbitral award, citing public policy concerns.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Navayo International AG | Plaintiff | Corporation | Application for extension of time to file SUM 589 refused | Won | |
| MEHIB – Hungarian Export Credit Insurance Pte Ltd | Plaintiff | Corporation | Application for extension of time to file SUM 589 refused | Won | |
| Ministry of Defence, Government of Indonesia | Defendant | Government Agency | Application for extension of time to file SUM 589 dismissed | Lost |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| S Mohan | Judge of the High Court | No |
| Sir Jeremy Lionel Cooke | International Judge | No |
| Roger Giles | International Judge | Yes |
4. Counsels
4. Facts
- Navayo and MEHIB obtained an arbitral award against the MOD for US$16,000,000.00 in a Singapore-seated arbitration.
- The claim in the Arbitration was for amounts invoiced by Navayo to the MOD in relation to a contract for the supply of equipment and services.
- The MOD applied to set aside the Enforcement Order, for leave to file further affidavits, and for sealing and redaction orders.
- The MOD contended that there was fraud in the procurement, execution, and performance of the contract.
- The Enforcement Order was transmitted to the Indonesian Ministry of Foreign Affairs on 26 April 2022.
- The MOD argued that the Enforcement Order had to be served in a manner complying with Indonesian laws and regulations.
- The MOD filed SUM 589 at 12.06am on 7 March 2023.
5. Formal Citations
- Navayo International AG and another v Ministry of Defence, Government of Indonesia, Originating Summons No 2 of 2023 (Summonses Nos 11, 589, 606 and 607 of 2023), [2024] SGHC(I) 10
6. Timeline
| Date | Event |
|---|---|
| Indonesian Ministry of Communications and Information notified that the “Garuda 1” had deorbited. | |
| Information conveyed to the MOD that the “Garuda 1” had deorbited. | |
| Presentation given by Thomas and Surya to Rear Admiral Agus Purwoto and other MOD officials. | |
| SatKomHan Contract executed between the MOD and Airbus. | |
| Leasing agreement signed with Avanti Communications Ltd for the use of Avanti’s Artemis satellite. | |
| Original Agreement between Navayo and Government of Indonesia / Ministry of Defence dated. | |
| Amendment to the Original Agreement dated. | |
| Original Agreement and Amendment Agreement signed by the MOD. | |
| Navayo submitted Invoice 1 to the MOD. | |
| Artemis satellite moved to the Orbital Slot. | |
| Navayo submitted Invoice 2 to the MOD. | |
| Navayo submitted Invoice 3 to the MOD. | |
| Navayo submitted Invoice 4 to the MOD. | |
| MOD notified Navayo to “pause” all further work. | |
| Navayo submitted Invoice 5 to the MOD. | |
| Navayo terminated the Navayo Agreement. | |
| SatKomHan Programme terminated. | |
| Arbitration initiated by Navayo's Request for Arbitration. | |
| Award issued in favour of Navayo and MEHIB. | |
| Central Jakarta District Court issued an exequatur award. | |
| MOD filed a challenge against the Exequatur Award. | |
| Plaintiffs filed OS 94 in the Singapore High Court. | |
| Enforcement Order made. | |
| Plaintiffs filed HC/SOD 9/2022 requesting that the Enforcement Order be sent through the proper channel to Indonesia. | |
| Registry of the Supreme Court of Singapore forwarded the Enforcement Order to the Singapore Ministry of Foreign Affairs. | |
| Enforcement Order delivered to the Indonesian Ministry of Foreign Affairs. | |
| Court papers served upon the MOD by the Jakarta DC. | |
| SUM 589, SUM 606 and SUM 607 filed. | |
| Proceedings transferred to the Singapore International Commercial Court and re-assigned the case number SIC/OS 2/2023. | |
| MOD filed SUM 11. | |
| Hearing on applications for extension of time, leave to file further affidavits, and sealing and redaction orders. | |
| Judgment reserved. |
7. Legal Issues
- Enforcement of Arbitral Award
- Outcome: The court held that the MOD's application to set aside the enforcement order was dismissed.
- Category: Substantive
- Sub-Issues:
- Public policy exception
- Fraud in procurement
- Fraud in arbitration
- Extension of Time
- Outcome: The court held that the MOD's application for an extension of time was dismissed.
- Category: Procedural
- Sub-Issues:
- Reasons for delay
- Length of delay
- Prejudice to parties
- Service of Documents
- Outcome: The court held that service was effected upon receipt of the Enforcement Order by the Indonesian MFA.
- Category: Procedural
- Sub-Issues:
- Service on a State
- Compliance with foreign law
8. Remedies Sought
- Enforcement of Arbitral Award
- Setting Aside Enforcement Order
- Sealing and Redaction Orders
9. Cause of Actions
- Breach of Contract
10. Practice Areas
- Commercial Litigation
- Arbitration
- Enforcement of Arbitral Awards
11. Industries
- Government
- Defense
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Josias Van Zyl v Kingdom of Lesotho | High Court | Yes | [2017] 4 SLR 849 | Singapore | Cited for the principle that Section 14 of the State Immunity Act stipulates the mode of service of proceedings against a State. |
| CNX v CNY | High Court | Yes | [2022] 5 SLR 368 | Singapore | Cited for the principle that s 14(2) of the SIA and the ROC are meant to work in tandem, such that any time period fixed by the court under O 69A r 6(4) of the ROC begins to run two months after the date of service. |
| Humpuss Sea Transport Pte Ltd (in compulsory liquidation) v PT Humpuss Intermodal Transportasi TBK and another | High Court | Yes | [2015] 4 SLR 625 | Singapore | Cited for the principle that the validity of service falls to be determined by the law of Singapore. |
| Pacific Assets Management Ltd v Chen Lip Keong | High Court | Yes | [2006] 1 SLR(R) 658 | Singapore | Cited for the principle that the court as the lex fori follows its own rules of evidence and procedure, and not those of the foreign country. |
| General Dynamics United Kingdom Ltd v State of Libya | Supreme Court of the United Kingdom | Yes | [2022] AC 318 | United Kingdom | Cited for the principle that the question is to be decided having regard to the ordinary meaning of the statutory provision, its purpose, and its legal context, including considerations of international law and comity. |
| Cosmetic Care Asia Ltd and others v Sri Linarti Sasmito | High Court | Yes | [2021] SGHC 157 | Singapore | Cited for the principle that nothing in Article 5(j) of the VCCR addresses service of foreign process or provides that any form of service of process is mandatory. |
| Regina (Sandiford) v Secretary of State for Foreign and Commonwealth Affairs | Supreme Court of the United Kingdom | Yes | [2014] 1 WLR 2697 | United Kingdom | Cited for the principle that the VCCR permits, but it is not suggested that it obliges, the exercise of any such functions. |
| Bloomberry Resorts and Hotels Inc and another v Global Gaming Phillipines LLC and another | High Court | Yes | [2021] 3 SLR 725 | Singapore | Cited for the factors the court takes into consideration in deciding whether to grant an extension of time. |
| Sun Jin Engineering Pte Ltd v Hwang Jae Woo | High Court | Yes | [2011] 2 SLR 196 | Singapore | Cited for the factors the court takes into consideration in deciding whether to grant an extension of time. |
| Falmac Ltd v Cheng Ji Lai Charlie and another matter | High Court | Yes | [2014] 4 SLR 202 | Singapore | Cited for the principle that the courts generally focusing on the first two factors when deciding whether to grant an extension of time. |
| Ching Chew Weng Paul, deceased and others v Ching Pui Sim and others | High Court | Yes | [2011] 3 SLR 869 | Singapore | Cited for the principle that a judgment obtained by fraud cannot be allowed to stand. |
| PT First Media TBK v Astro Nusantara International BV & Ors | Hong Kong Court of Final Appeal | Yes | [2018] 3 HKC 458 | Hong Kong | Cited for the principle that the applicable principle in deciding whether the time should be extended is to look at all relevant matters and consider the overall justice of the case, and that a rigid and mechanistic approach is not appropriate. |
| The Federal Republic of Nigeria v Process & Industrial Development Ltd | High Court of Justice | Yes | [2020] EWHC 2379 | England and Wales | Cited for the principle that there can be no prejudice to the award creditor in being subject to a full inquiry into the alleged fraud because an award that is liable to be set aside as having been procured by fraud is, in legal terms, worthless. |
| Poh Soon Kiat v Desert Palace Inc (trading as Caesars Palace) | High Court | Yes | [2010] 1 SLR 1129 | Singapore | Cited for the principle that the court can examine the correctness of expert's premises and reasoning. |
| PT Asuransi Jasa Indonesia (Persero) v Dexia Bank SA | Court of Appeal | Yes | [2007] 1 SLR(R) 597 | Singapore | Cited for the principle that the public policy ground is invoked when the upholding of the award would “shock the conscience” or is “clearly injurious to the public good or … wholly offensive to the ordinary reasonable and fully informed member of the public” or “where it violates the forum’s most basic notion of morality and justice”. |
| Bloomberry Resorts and Hotels Inc and another v Global Gaming Phillipines LLC and another | Court of Appeal | Yes | [2021] 1 SLR 1045 | Singapore | Cited for the principle that the making of the award must have been causatively induced or affected by fraud or corruption. |
| Mustafa Ahunbay v Public Prosecutor | High Court | Yes | [2015] 2 SLR 903 | Singapore | Cited for the principle that there is a public interest in maintaining the integrity of a police investigation. |
13. Applicable Rules
| Rule Name |
|---|
| Rules of Court 2014 |
| Rules of Court 2014 |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| International Arbitration Act 1994 | Singapore |
| State Immunity Act 1979 | Singapore |
| Diplomatic and Consular Relations Act 2005 | Singapore |
15. Key Terms and Keywords
15.1 Key Terms
- Arbitral Award
- Enforcement Order
- State Immunity Act
- SatKomHan Programme
- Navayo Agreement
- Certificate of Performance
- Ministry of Foreign Affairs
- Extension of Time
- Public Policy
- Fraud
15.2 Keywords
- arbitration
- enforcement
- state immunity
- service of process
- extension of time
- public policy
- fraud
17. Areas of Law
| Area Name | Relevance Score |
|---|---|
| Enforcement of Arbitral Awards | 95 |
| Arbitration | 90 |
| Civil Procedure | 85 |
| Fraud and Deceit | 70 |
| Illegality and public policy | 60 |
| Service out of jurisdiction | 60 |
| Jurisdiction | 50 |
| Evidence Law | 30 |
| Costs | 20 |
| Issue Estoppel | 20 |
16. Subjects
- Arbitration
- Civil Procedure
- International Law
- Enforcement of Arbitral Awards
- Service of Process
- Extension of Time