In BLC and others v BLB and another [2014] SGCA 40, the Singapore Court of Appeal considered an appeal against the High Court’s decision to remit a counterclaim back to arbitration.
The appellant had obtained an arbitration award against the respondent. The respondent subsequently applied to the Singapore High Court to set aside the award on the basis that the arbitrator had failed to consider one of its counterclaims. The court agreed, holding this to be a breach of natural justice. It remitted the counterclaim to arbitration but upheld the remainder of the award. The appellant appealed, arguing that the disputed counterclaim was directly linked to several issues that had been determined by the arbitrator and therefore had already been addressed.
In allowing the appeal, the Court of Appeal found that the respondent’s own pleadings had inextricably linked the counterclaim to many of the issues that had been addressed by the arbitrator in the award (and decided in the appellant’s favour). Therefore, it could not be said that the arbitrator had not addressed his mind to the counterclaim.
In considering this issue, the court had to carry out an analysis of the award and the parties’ pleadings in the arbitration. However, the court noted that it should not “carry out a hypercritical or excessively syntactical analysis”, nor should it endeavour “to pick holes, inconsistences and faults in awards”. The court also stressed that the substantive merits fell outside its jurisdiction, even where there may have been a serious error of law and/or fact on the arbitrator’s part.
The Singapore courts have recently heard numerous applications by parties seeking to set aside arbitration awards. The Court of Appeal’s decision reflects the courts’ general reluctance to do so. The decision also serves as a reminder to parties that there is no right of appeal of Singapore awards on the merits.
Source: BLC and others v BLB and another [2014] SGCA 40
*A version of this article was originally published by Practical Law Arbitration http://uk.practicallaw.com/country/arbitration