In BRQ v BRS [2019] SGHC 260, the Singapore High Court found that the commencement of the three-month time limit under Art 34(3) was postponed whenever a party makes a request to the tribunal under Art 33, and further that a request made under Art 33 is purely a matter of form and does not depend on evaluating the substance of the request by applying any qualitative test. (See earlier post here)
On appeal to the Court of Appeal (BRS v BRQ [2020] SGCA 108), the CA noted that there were three types of Art 33 requests:
(i) a request for “the arbitral tribunal to correct in the award any errors in computation, any clerical or typographical errors or any errors of similar nature” (Art 33(1)(a) of the Model Law) (“Art 33 correction request”);
(ii) a request for “the arbitral tribunal to give an interpretation of a specific point or part of the award” (Art 33(1)(b) of the Model Law) (“Art 33 interpretation request”); and
(iii) a request for “the arbitral tribunal to make an additional award as to claims presented in the arbitral proceedings but omitted from the award” (Art 33(3) of the Model Law) (“Art 33 additional award request”).
After reviewing various Indian and New Zealand authorities (State of Arunachal Pradesh v Damani Construction Co (2007) 10 SCC 742; Shayam Sunder v Kotak Securities Ltd (2017) Del 4157; M/s Ved Prakash Mithal and Sons v Union of India (unreported); Municipal Corporation v Walter Bau AG (2019) SCC OnLine Bom 2920; Opotiki Packing & Coolstorage Ltd v Opotiki Fruitgrowers Co-operative Ltd (In Receivership) [2003] 1 NZLR 205; Todd Petroleum Mining Co Ltd v Shell (Petroleum Mining) Co Ltd [2015] 2 NZLR 180), finding that the first instance judge had placed undue reliance on Todd. The CA stated (@69 & 70):
“Notwithstanding the arguments for certainty and simplicity, we are of the view that it is important to bear in mind that Art 33 is an exception to the initial time limit in Art 34(3). It delineates three types of requests which would in fact extend that time limit. In the case of an Art 33 correction request, the provision does not merely refer to a request to correct an error in an award. It goes on to elaborate that the error is to be “in computation, any clerical or typographical errors or any errors of similar nature” (Art 33(1)(a) of the Model Law).”
“This is the equivalent of what is often referred to in court proceedings as the slip rule (see Sundaresh Menon et al, Arbitration in Singapore: A Practical Guide, Sweet & Maxwell, 2nd Ed 2018, at paras 13.044–13.045). The Seller accepted in oral argument that that was likewise the purpose of Art 33 correction requests. It seems to us that it would be incongruous and an abuse of Arts 33 and 34 if a party could claim that its request for correction comes within the meaning of the Phrase so long as its terms state that it is made under the relevant provision in Art 33 and it seeks a correction of the award in question, even if in substance it is clearly nothing of the sort. That would defeat the purpose of specifying only three types of requests in Art 33 and render them otiose as effectively any request to the tribunal would suffice to extend time for making a setting-aside application to court so long as the request is drafted to follow the terms of the applicable provision(s) in Art 33.”
Concluding (@72):
“Accordingly, we are of the view that the Phrase means that the substance of a request under Art 33 must come within the scope of the relevant provision in order that the request has the effect of extending the initial time limit under Art 34(3). Consequently, the court may consider the substance of the request to see if it comes within the scope of the relevant provision.”
Applying the above to the facts, the CA held that the “corrections” sought by the Seller were in truth reviews of the Tribunal’s decision on substantive matters, stating (@81):
“Accordingly, we are satisfied that the Correction Request was not in substance an Art 33 correction request. The Seller has also not contended that the Correction Request was either an Art 33 interpretation request or an Art 33 additional award request. Hence, there was no request made under Art 33 that triggered the extension of the initial time limit under Art 34(3) of the Model Law in the present case. Since the Seller’s setting-aside application was filed more than three months after the Award had been received by the parties, and as the court does not have the power to otherwise extend the three-month time limit in Art 34(3) (ABC Co v XYZ Co Ltd [2003] 3 SLR(R) 546 at [9]; BXS v BXT [2019] 4 SLR 390 at [41]), the Seller’s application to set aside the award is time-barred.”
Accordingly, since the Respondent’s set-aside application was filed more than three months after the award had been received by the parties, and importantly, the Court did not have any power to extend this time limit, the Respondent’s challenge was time- barred.
In relation to the application that the Award fell foul of the rules of natural justice, the CA considered that the award demonstrated that the tribunal had failed to take certain design evidence into consideration, and confirmed that this failure amounted to a breach of natural justice, causing “real and actual prejudice” to the Claimant by limiting the Claimant’s entitlement to costs. The Court therefore remitted the question of whether delays associated with rectifying the design would alter the Cut-off Date back to the Tribunal for further consideration, noting that it was an isolated issue that would affect only the quantum of indemnity payable by the Respondent to the Claimant. The rest of the award, however, remained intact.
See also the Summary produced by the Court, and the article produced by Debevoise.
Debevoise stated:
“In this judgment, the Singaporean Court of Appeal has confirmed the high bar faced by any party that wishes to challenge an arbitral award for an alleged failure to comply with the principles of natural justice. However, the Court has also confirmed that, where it is apparent that a tribunal has not duly addressed a point raised by the parties, that failure can be a basis for setting aside an award. In this case, the effect of the set- aside was limited to one issue, which was remitted to the tribunal for further consideration, but in other cases the effect on an award could be more drastic. The judgment also provides an important reminder of the need to observe statutory time limits for bringing challenges against arbitration awards and of the fact that Courts typically do not have any power to entertain requests for those time limits to be extended. Parties should be particularly careful of time limits in cases, such as this one, where a party seeks clarification of an award before raising its challenge, as an error about the true nature of a clarification request can mean that the party misses a time limit it had believed to be extended.”
