In Singapore Commodities Group Co, Pte Ltd v Founder Group (Hong Kong) Ltd [2025] SGCA 35, the Singapore Court of Appeal considered an appeal against a High Court order directing that funds paid into court be released to the creditor following an arbitration award, in the context of a pending winding-up application.

The dispute arose from a purchase contract for copper cathodes governed by PRC law, under which Founder Group claimed that Singapore Commodities Group (“SGC”) owed it a substantial sum (the “Alleged Debt”). After a CIETAC arbitration, the tribunal dismissed SGC’s claim for a declaration that the Alleged Debt did not exist but did not affirmatively find that the debt was due, as Founder Group had not counterclaimed. Following the award, funds previously paid into court as security were ordered to be released to Founder Group. SGC appealed, contending that the award was silent on the debt’s existence and that payment-out was therefore premature.

The Court of Appeal allowed the appeal, set aside the payment-out order, and remitted the the winding-up application to the High Court for further consideration. It held that the tribunal’s refusal to grant SGC a negative declaration did not imply a positive finding of debt and that PRC law could not be used to fill gaps in the award’s reasoning. Because the tribunal had not been asked to determine the debt’s validity, its silence could not be treated as affirming it.

The Court stressed that the award must be interpreted strictly according to its express terms and within the issues actually submitted to the tribunal. Since the existence of the Alleged Debt remained unresolved, it would be inappropriate to release the monies in court, as doing so would effectively decide the substantive dispute without adjudication.

This decision underscores the principle that courts must respect the boundaries of arbitral awards and avoid attributing determinations not made by the tribunal. It also highlights the need for parties to plead counterclaims if they wish to secure a positive finding in their favor and cautions against using payment-out applications to obtain de facto enforcement of unresolved claims.