Singapore High Court Rules ICC’s Findings Did Not Go Beyond The Scope Of Submission To Arbitration

The Singapore High Court (SGHC) in the case of CHH v CHI [2020] SGHC 269 dismissed an application under section 48 of the Arbitration Act to set aside a Singapore-seated International Chamber of Commerce (ICC) award on grounds that no prejudice was caused.

Facts:
The respondent who was the main contractor contracted the claimant as a subcontractor to supply  S stones and SV stones (the ‘stones’). The subcontract provided for a quality assurance and quality control process for stone selection. The respondent and/or architect rejected the stones. Accordingly, the claimant commenced ICC arbitration for payment, with the issue whether the stones complied with the acceptance criteria. The arbitrator accepted the stone inspector’s conclusions and held that the stones were compliant. The respondent argued that this finding went against the contractual scheme that final approval rested with the architect and not the stone inspector.

The decision:
The SGHC however disagreed and held that the arbitrator’s finding that the architect should have relied on the stone inspector was simply ‘part and parcel of the arbitrator preferring the stone inspector’s views to those of the architect’. Whether the stones complied with the contractual requirements was an issue in the arbitration and thus, it was open to the arbitrator to make the stone inspector finding. That finding was not in excess of jurisdiction nor a breach of natural justice. In any event, the SGHC noted that the arbitrator had other reasons for finding that the stones complied with the contractual requirements. As such, setting aside the arbitrator’s stone inspector findings would not affect the conclusion that the stones met the acceptance criteria.

Takeaway:
The decision suggests that to succeed in a setting aside application, the applicant is required to show not only that a ground for setting aside has been made out, but that prejudice has been caused as a result thereof.