Singapore High Court dismisses application to set aside arbitral award for breach of natural justice

In Siddiqsons Tin Plate Ltd v New Metallurgy Hi-Tech [2024] SGHC 272 the Singapore High Court clarified that the standard for a breach of natural justice is high. The claimant (Siddiqsons Tin Plate Ltd) sought to set aside an arbitral award on the basis of an alleged breach of natural justice. The claimant argued that its rights to a fair hearing had been violated, in particular because the tribunal had failed to consider its arguments and had denied it the right to present its case properly. He thus challenged an arbitral award issued on October 6, 2022. However, the Supreme Court found that the high standard for a violation of natural justice had not been met. The court literally stated in its reasoning that the application "did not come close to meeting the high threshold for establishing a breach of natural justice. In order for a party to succeed in an application for a declaration of invalidity, it would have to show both that there had been a breach of natural justice and that the breach had "at the very least altered the decision of the court in some meaningful way" - that there had been "actual or real prejudice". 

On these grounds, the court dismissed the claimant's claims. First, according to the High Court's reasoning, it was not a breach of natural justice for the court to allow New Metallurgy to file an unauthorized response to a preliminary substantive issue of law. In particular, the Siddiqsons did not specify the nature of the prejudice they had suffered in the subsequent response. The High Court also rejected the complaint that the court had rushed to complete the MOI, thereby preventing the parties from requesting the production of documents. The court found this complaint to be "even more misconceived than the previous one". Not only did the parties have the opportunity to comment on the draft MOI, which the Siddiqsons did, but the court also found that the Siddiqsons' counsel did not make any requests for production of documents after seeing the draft MOI. 

Finally, the claimant argued that the tribunal interfered with the conduct of cross-examination and influenced the witnesses' answers, which constituted a breach of natural justice. The court disagreed. Rather, it found that the interruptions were merely interjections to ensure that counsel's questions were precise and understandable. The tribunal therefore acted within its general authority to conduct the proceedings. Similarly, the applicant failed to show that his legal position was prejudiced by this procedure. 

A de facto appeal based on a violation of natural justice remains virtually impossible in arbitral proceedings. This preserves an important advantage of arbitration. The decision is final and can usually be enforced more quickly than court judgments.