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Right to full opportunity of presenting a case under Model Law is not unlimited

In the case of China Machine New Energy Corp v Jaguar Energy Guatemala LLC and Another [2020] SGCA 12 the Singapore’s Court of Appeal clarified that a party’s right under Article 18 of the UNCITRAL Model Law on International Commercial Arbitration (Model Law) to a ‘full opportunity’ of presenting its case is not unlimited and provided guidance on the correct approach to alleged violations of due process by the Tribunal.

The parties’ dispute related to an Engineering, Procurement and Construction Contract (“EPC Contract”) by the appellant contractor (“CMNC”) for the respondent owners (“Jaguar”). When CMNC failed to meet certain deadlines under the EPC Contract, Jaguar commenced arbitration claiming, amongst others, the cost of completing the power plant. The Singapore seated Tribunal awarded Jaguar the vast majority of its claims.

CMNC applied to the High Court to set aside the award contending that it has been deprived from being given a full opportunity to present its case under Article 18 of the Model Law, as it was “unable to present his case”, and its rights are prejudiced because a “breach of the rules of natural justice occurred in connection with the making of the award”.

The Court rejected CMNC’s setting aside application and held that:

  • the Article 18 right to a ‘full opportunity’ of presenting one’s case is not an unlimited one. It is impliedly limited by considerations of reasonableness and fairness so that it would not be abused by the parties seeking to delay and prolong proceedings;

  • what constitutes a ‘full opportunity’ hinges on the particular facts and circumstances of each case;

  • the court should ask itself whether the proceedings were conducted in a fair manner and if the Tribunal’s act/omission falls within what a reasonable and fair minded Tribunal in those circumstances might have done;

  • in doing so, the court must put itself in the shoes of the Tribunal, by reference to what was known to the Tribunal at the time. The alleged breach of natural justice must also have been brought to the attention of the Tribunal at the material time; and the court will allow a margin of deference and not intervene simply because it might have done things differently; and

  • if a party contends that there has been a fatal failure in the process of the arbitration, there must have been fair intimation to the Tribunal at the appropriate time when the Tribunal insists on proceeding.

This ruling fortifies the Singapore courts’ policy of minimal intervention towards arbitral proceedings and the threshold to satisfy a breach of natural justice remains a high one.

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