ARBITRAL AWARD WILL NOT BE GRANTED FOR WRONGLY SEATED ARBITRATION

An ambiguous clause can result in parties wasting precious time and resources to obtain an award which is not enforceable due to the arbitration being mistakenly commenced in the wrong seat

In the recent Court of Appeal (“CA”) decision of ST Group Co Ltd v Sanum Investments Limited [2019] SGCA 65 (“ST Group (CA)”), the CA held that leave to enforce an arbitration award will not be granted for a wrongly seated arbitration.

Factual background

The claimant in the arbitration proceedings was Sanum Investments Limited (“Sanum”), while the respondents were ST Vegas Enterprise Ltd, ST Group Co, Ltd, ST Vegas Co, Ltd and one Mr. Sithat Xaysoulivong (“Mr. Sithat”) (collectively, the “Lao parties”). Sanum is also the appellant in the appeal, while the ST Group Co, Ltd (“ST Group”) was the respondent in the appeal.

The parties entered into various joint venture (“JV”) arrangements to invest in the Laotian gaming industry and correspondingly entered into various JV agreements.

First, Sanum and ST Group entered into a Master Agreement on 30 May 2007 which contained a multi-tiered dispute resolution clause providing for, inter alia, parties to use an “internationally recognized mediation/arbitration company in Macau”. The Master Agreement also envisaged that there would be separate sub-agreements corresponding to the details of each joint venture.