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Arbitration agreements

What are the validity requirements for an arbitration agreement?

In order for an arbitration agreement to be valid, it must contain an agreement by the parties to submit to arbitration all or certain disputes which have arisen or which may arise between them in respect of a defined legal relationship. The arbitration agreement may take the form of an arbitration clause in a contract or a separate agreement. Moreover, the arbitration agreement must be in writing. This requirement will be satisfied if the content of the arbitration agreement is recorded in any form, irrespective of whether it was concluded orally, by conduct or by other means. The arbitration agreement may also be contained in an electronic communication, provided that the information contained therein is accessible and useable for subsequent reference.

Enforcement of agreements
How are arbitration agreements enforced in your jurisdiction? What is the attitude of the national courts towards arbitration agreements?

There are two main ways in which arbitration agreements may be enforced by the local courts:

  • Domestic court proceedings are stayed in favour of arbitration.
  • An anti-suit injunction is issued to restrain a party from proceeding with foreign court proceedings instituted in breach of the arbitration agreement.

The Singapore courts are pro-arbitration and will seek to uphold arbitration agreements wherever possible. In particular, under the International Arbitration Act, the local courts must order a stay of court proceedings commenced in breach of an arbitration agreement unless the arbitration agreement is null and void, inoperative or incapable of being performed. The judiciary has no residual discretionary power to refuse a stay.

In contrast, under the Arbitration Act, the local courts have discretion to refuse to order a stay. However, this discretion will be exercised only in limited circumstances. For instance, the local courts may refuse to order a stay where the dispute involves multiple parties and not all of them are party to the arbitration agreement. In such case, the courts take the view that the commencement of arbitration would likely result in delay, extra costs and potentially inconsistent findings.

The different approaches under the Arbitration Act and the International Arbitration Act have arisen as a result of legislative intent for the local courts to have a greater degree of curial supervision over domestic arbitration, as compared to international arbitration. 

Can an arbitral tribunal with its seat in your jurisdiction consolidate separate arbitral proceedings under one or more contracts, and, if so, in what circumstances?

As arbitration is founded on consent, an arbitral tribunal may consolidate separate arbitral proceedings under one or more contracts if all of the arbitrating parties consent. Without such consent, the arbitral tribunal has no power to consolidate multiple proceedings, even if such proceedings involve the same parties and tribunal.

Choice of law
How is the substantive law of the dispute determined? Where the substantive law is unclear, how will a tribunal determine what it should be?

The substantive law of the dispute is determined by the arbitral tribunal, which under the Arbitration Act and the International Arbitration Act must decide the dispute in accordance with the law chosen by the parties. If no law has been chosen, the tribunal will apply the relevant conflict of laws principles to determine the appropriate substantive law. This involves ascertaining the parties’ intent from the circumstances or, where this is not possible, applying an objective test to determine which system of law has the closest and most real connection to the subject matter of the contract.

Are there any provisions on the separability of arbitration agreements?

The separability of arbitration agreements is covered in Section 21(2) of the Arbitration Act and Article 16(1) of the Model Law. These provisions allow an arbitral tribunal to rule on its own jurisdiction and provide that for this purpose, an arbitration clause which forms part of a contract shall be treated as an agreement independent of the other terms in the contract.

Multiparty agreements
Are multiparty agreements recognised?

Yes, multiparty agreements are recognised. A third party may be joined to the arbitration if all parties consent or if this is permitted by the relevant institutional rules that govern the arbitration. 

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