[2017] SGHC 127

IN THE HIGH COURT OF THE REPUBLIC OF SINGAPORE
[2017] SGHC 127
Originating Summons No 501 of 2016
Between
BMO
… Plaintiff
And
BMP
… Defendant
JUDGMENT
[Arbitration] — [Arbitral tribunal] — [Jurisdiction]

[Arbitration] — [Agreement] — [Repudiation]
[Arbitration] — [Agreement] — [Waiver]
[Arbitration] — [Agreement] — [Estoppel]
Version No 2: 27 Oct 2020 (22:40 hrs)

TABLE OF CONTENTS
INTRODUCTION............................................................................................1
THE DISPUTE .................................................................................................3
CHANGES TO THE VIETNAM SUBSIDIARY’S CHARTER .................4
EVENTS LEADING TO THE DUE DILIGENCE REPORT .....................5
THE BVI LITIGATION AND THE ARBITRATION.................................7
PRELIMINARY MATTERS ........................................................................13

GOVERNING LAW OF THE ARBITRATION AGREEMENT ....................................13
WITHDRAWAL OF THE DEFENDANT’S CHALLENGE TO THE VALIDITY OF THE
REVISED CHARTER ........................................................................................16
SCOPE OF ARTICLE 22(2) ..............................................................................17
IS THE AGREEMENT TO ARBITRATE MANDATORY?.........................................22
IS THE ARBITRATION AGREEMENT INOPERATIVE? ....................26

WAIVER ........................................................................................................26
Election as a response and the element of choice....................................27
The element of knowledge ........................................................................31
(1) Attribution generally ...................................................................32
(2) Receivers’ actual knowledge.......................................................35
REPUDIATION ................................................................................................37
Relevant principles...................................................................................37
Explanation for the breaching party’s conduct .......................................40
Acceptance of repudiation........................................................................44
ESTOPPEL ......................................................................................................49

CONCLUSION...............................................................................................53

This judgment is subject to final editorial corrections approved by the
court and/or redaction pursuant to the publisher’s duty in compliance
with the law, for publication in LawNet and/or the Singapore Law
Reports.
BMO
v
BMP
[2017] SGHC 127
High Court — Originating Summons No 501 of 2016

Belinda Ang Saw Ean J
6, 13 February; 10 March 2017
26 May 2017 Judgment reserved.
Belinda Ang Saw Ean J:
Introduction
1 Originating Summons No 501 of 2016 (“OS 501”) is an application

filed by the plaintiff, BMO, pursuant to s 10(3) of the International Arbitration
Act (Cap 143A, 2002 Rev Ed) (“the IAA”) opposing the ruling of a sole
arbitrator (“the Tribunal”) on his jurisdiction (“Decision on Jurisdiction”) to
adjudicate on disputes in an arbitration brought under the auspices of the
Singapore International Arbitration Centre Arbitration on 12 March 2015 (“the
Arbitration”). The defendant in OS 501 is BMP, a Malaysian incorporated
company that was placed in receivership on 30 November 2006, and is acting
through individuals appointed as receivers and managers (“the Receivers”).
2 Prior to commencing the Arbitration on 12 March 2015, the defendant

sued the plaintiff and two individuals in the British Virgin Islands on 22 July

BMO v BMP [2017] SGHC 127
2014 (“the BVI litigation”). At some stage during the BVI litigation, the
defendant gave notice of its intention to stop the BVI litigation in order to
move to arbitration instead. This judgment will consider the principal question
as to whether or not there is still a binding or operative arbitration agreement
between the parties despite participation in the BVI litigation; and if the
answer is in the affirmative, the next question that arises is whether the claims
made in the Arbitration are within the ambit of the arbitration agreement.
3 Related to the principal question is the enquiry that examines whether

there is a point of no return beyond which a party participating in litigation
would be held to have either no right to arbitrate or to compel the other to
arbitrate. For instance, under what circumstances has a party that wishes to
switch from litigation to arbitration waived its contractual right to compel
arbitration of the same dispute? The plaintiff argues that the defendant’s
commencement of the BVI litigation constituted: (a) a waiver of the
defendant’s right to arbitrate the dispute and that waiver rendered the
arbitration agreement inoperative; and/or (b) a repudiation of the arbitration
agreement which was accepted by the plaintiff and that acceptance brought to
an end the contractual obligation to arbitrate. The plaintiff’s further argument
is that the defendant is estopped by its conduct in the BVI litigation from
relying on the arbitration agreement.
4 Whilst the defendant’s submissions mainly addressed the plaintiff’s

arguments as described, the defendant also pointed out that the focus of the
doctrines of waiver/election or waiver by election ought to “rest” with the
plaintiff and not with the defendant. In other words, the focus should not be on
the conduct of the defendant (as argued for by the plaintiff), but on the
plaintiff’s conduct after the defendant’s breach of an agreement to arbitrate.
All said, whether there is or has been litigation between the parties is not alone

sufficient to indicate a waiver/election or waiver by election. A deeper enquiry

has to be done in order to determine the nature of the parties’ participation in
the judicial forum, including whether there has been conduct demonstrating an
intent to waive arbitration.
The dispute
5 The substantive dispute in the BVI litigation and the Arbitration

concerns the defendant’s ownership of the share capital of its subsidiary in
Vietnam (“the Vietnam Subsidiary”). The defendant’s complaint against the
plaintiff and two individuals, who are brothers and former directors of the
defendant, is that through a series of share transfers that took place in 1999,
2007 and 2008 (collectively, “the Share Transfers”), the defendant’s
shareholding in the Vietnam Subsidiary was substantially reduced to 0.19%
whereas the plaintiff ended up as the major shareholder with 99.7 % interest in
the Vietnam Subsidiary. The remaining 0.11% of the share capital is owned by
a company incorporated in the British Virgin Islands (“BVI Company 1”). It is
the defendant’s case that the brothers were responsible and complicit in the
unauthorised and unlawful share transfers that eventually resulted in the
plaintiff becoming the majority shareholder in the Vietnam Subsidiary. It is
not disputed that, at all material times, the brothers were and are still the
shareholders of the plaintiff. I will refer to the brothers individually as
Shareholder 1 and Shareholder 2. The plaintiff has one director and he is
Shareholder 2. The defendant’s case against the plaintiff is that the latter
dishonestly assisted the brothers in respect of the Share Transfers thereby
depriving the defendant of the bulk of its shares in the Vietnam Subsidiary.
Furthermore, the plaintiff received those shares wrongfully with knowledge of
the brothers’ breach of fiduciary duties and breach of trust.

6 The brothers were shareholders in several related companies that were

incorporated in Taiwan, and they are identified here as Taiwan Company 1;
Taiwan Company 2 and Taiwan Company 3. At all material times,
Shareholder 1 was the controlling shareholder of these companies. He was
also the Chairman of Taiwan Company 3.
Changes to the Vietnam Subsidiary’s charter
7 The Vietnam Subsidiary was first incorporated on 30 December 1993,

and upon incorporation, a company charter was entered into (“the 1993
Charter”). In the 1993 Charter, the defendant was identified as the sole
shareholder of the Vietnam Subsidiary, and was regarded as the defendant’s
wholly-owned subsidiary. At all material times, Shareholder 1 was the
Chairman of the Vietnam Subsidiary.
8 In February 2008, Shareholder 1 (purportedly acting for the

defendant), the representative of the plaintiff and the representative of Taiwan
Company 1 caused the Vietnam Subsidiary to be re-registered for the purposes
of obtaining an amended investment certificate and changing the Vietnam
Subsidiary’s corporate form. A new Charter (“the Revised Charter”) was
adopted. The Vietnam Subsidiary, previously a wholly-owned private
enterprise, became a limited liability corporation (“LLC”), with the defendant,
the plaintiff and Taiwan Company 1 reflected in the Revised Charter as its
members.
9 The arbitration agreement sought to be invoked in the Arbitration is

Article 22(2) of the Revised Charter. Both the plaintiff and the defendant have
adduced separate versions of the Revised Charter which contain
differently-worded versions of Article 22(2). The variants of Article 22(2) will

be addressed later in this judgment (see [56] below).
Events leading to the Due Diligence Report
10 The defendant suffered a liquidity crisis in late 1999, and sought from
its creditors a moratorium on the repayment of its debt. Eventually, this led to
the creditors’ approval of a scheme of arrangement on 25 August 2004. In
addition, a debenture dated 27 August 2004 was furnished in favour of the
Named Debenture Holder as trustee for the secured creditors. This debenture
was subsequently amended. As the defendant’s financial situation did not
improve, it was put into receivership on 30 November 2006, pursuant to the
terms of the debenture. As stated, the defendant now acts through its
Receivers.
11 After 30 November 2006, the Receivers were able to get hold of the
defendant’s audited accounts from 1998 to 2005. The Receivers also began the
lengthy process of understanding, amongst other things, the defendant
company, details of all of the defendant’s assets and liabilities, its physical
books and records, as well as its accounting system and internal controls.
During this process, the Receivers discovered that there were unexplained
reductions in the defendant’s share capital in the Vietnam Subsidiary. There
were also other significant non-cash transactions that did not tally with the
amounts stated in the defendant’s accounts. These discrepancies prompted the
Receivers to commission a legal due diligence report. A Vietnamese law firm,
IndoChine Counsel: Business Law Practitioners (“IndoChine Law”), was
engaged in the matter.
12 On 3 February 2009, IndoChine Law’s proposed scope of service in

respect of the Vietnam Subsidiary was, inter alia, “to obtain corporate

records/legal documents related to the Company, including but not limited to:
(a) Investment licenses/certificates and any amendments; (b) Company
Charter or any amendment; (c) Latest information/documents on the
shareholders/members of the Company and directors of the Company”. This
proposal was accepted by the Receivers on 5 February 2009. IndoChine Law’s
report dated 19 June 2009 (“the Due Diligence Report”) was sent to the
Receiver’s under cover of IndoChine Law’s letter on 1 July 2009.
13 Two sections of the Due Diligence Report are relevant to the present
application. First, Section 1.4 of Part A states that one of the purposes of the
Due Diligence Report was to “[advise] on consequences and legal redress
under the laws of Vietnam in respect of the transaction of transfer of the
capital from [the defendant] to [the plaintiff] in the view that the authorized
representative of the [defendant] is not authorized to act or has acted ultra
vires.” The representative of the defendant who was not authorised is none
other than Shareholder 1 (see [8] above).
14 Second, Section 6.2 of Part C states, in relation to the transfer of

capital from the defendant to the plaintiff, the defendant has “the right to bring
this matter to the authorized court/arbitration against such unauthorized
representative in order to request the court to consider and judge invalidity of
such fabricated capital assignment transaction.” Again, the unauthorised
representative is Shareholder 1.
15 Prior to the appointment of IndoChine Law, the Receivers were

embroiled for two years in litigation brought by the former directors of the
defendant in Malaysia in January 2007 (“the Malaysian litigation”). In that
litigation, the Receivers and the debenture holders were sued. The Malaysian
litigation was finally struck out on 11 February 2009.

16 The Receivers commenced the BVI litigation on 22 July 2014, five

years after the Due Diligence Report. The explanation provided by the
Receivers was that the Due Diligence Report raised matters that needed
further investigation. For instance, the Receivers needed to find out the
individuals behind the plaintiff, a BVI company. The Receivers also had to
verify and to confirm that no consideration was given for the Share Transfers.
The task was difficult and protracted because the defendant’s corporate
documents were disorganised and several of the defendant’s former officers
were untraceable after returning to Taiwan. In addition, the Receivers did not
know of the whereabouts of the brothers and it was only in 2014 that they
learnt of the Hong Kong address of Shareholder 1.
The BVI litigation and the Arbitration
17 On 22 July 2014, the defendant commenced the BVI litigation against

the plaintiff and the two brothers (Shareholder 1 and Shareholder 2) by filing a
Claim Form and Statement of Claim with the Eastern Caribbean Supreme
Court in the High Court of Justice (Virgin Islands) (Commercial) (“the BVI
High Court”). In the Statement of Claim, the defendant alleged that it had
suffered loss and damage by being wrongfully deprived of its shareholding in
the Vietnam Subsidiary. The causes of action pursued against the brothers
included breaches of statutory and fiduciary duties for effecting the Share
Transfers, profiting from the transfers and for placing themselves in situations
where there was a conflict between their personal interests and the defendant’s
interests. In relation to the plaintiff, the defendant’s allegations were that the
plaintiff had dishonestly assisted the two brothers in respect of the Share
Transfers, knowingly received the defendant’s shares in the Vietnam
Subsidiary, and that the plaintiff had thereby been unjustly enriched.

18 In the BVI litigation, the defendant sought the following reliefs. As

against the plaintiff solely, it sought an order compelling the plaintiff to return
by re-transferring its shareholding in the Vietnam Subsidiary to the defendant.
As against the brothers and the plaintiff, it sought compensation in equity, an
account of the misappropriated shareholding, an account of sums received in
respect of the shareholding, a declaration that the plaintiff held on to any
assets and sums received as constructive trustees for the defendant, a
declaration that the plaintiff was to reconstitute those assets which it held on
trust for the defendant, interests in equity and costs.
19 On 22 July 2014, the defendant made two interlocutory applications.

First, it applied for leave to serve the cause papers and ancillary documents on
the brothers out of jurisdiction. At the same time, it applied to the BVI High
Court for an order restraining the plaintiff from registering any transfer of the
brothers’ shareholding in the plaintiff, and from transferring, charging, parting
with possession or disposing of any of its interests in the Vietnam Subsidiary
(the “Interim Injunction”). In support of the Interim Injunction application, the
defendant’s counsel in the BVI filed an affidavit and the exhibits to the
affidavit included the Due Diligence Report and its annexures comprised the
Revised Charter. Both applications were granted.
20 On 4 November 2011, the plaintiff acknowledged service of the Claim

Form and Statement of Claim. There was a questionnaire to be filled on the
Acknowledgment of Service form, and one of the questions raised was
whether the plaintiff intended to defend the claim. The plaintiff ticked the
“YES” box.
21 All the defendants in the BVI litigation then individually filed

applications for declarations that the BVI was not the natural or appropriate

forum to determine the dispute. Shareholder 2 filed his application on 18

December 2014 and Shareholder 1 followed suit on 6 January 2015. The
plaintiff filed a similar application on 18 December 2014, but amended it
subsequently on 26 January 2015 to include an application to discharge the
Interim Injunction ordered on 22 July 2014 (see [19] above).
22 On 2 February 2015, the defendant sought leave to discontinue the BVI

litigation as against the brothers. At that time, the brothers’ stay applications
had yet to be heard. The reason for desiring discontinuance was the
defendant’s belief that it would be a “better use of resources of the Court for
[the defendant] to continue the claim against [the plaintiff] which currently
holds the shares in [the Vietnam Subsidiary], the subject of the claim”. On 9
February 2015, the defendant obtained leave of court to discontinue the BVI
litigation against the brothers. On that same day, the BVI High Court also
heard the plaintiff’s applications for the discharge of the Interim Injunction
and for a declaration that the BVI was not the natural and appropriate forum
for the disputes to be heard. Both applications were dismissed.
23 On 6 March 2015, the plaintiff filed a fresh application to discharge the

Interim Injunction. Its grounds of application were that the Interim Injunction
was procedurally irregular, that the defendant’s Statement of Claim disclosed
no serious issue to be tried, and that there was no risk of dissipation of assets.
The plaintiff also argued that the defendant had no legitimate interest in
restricting the ability of the brothers from dealing freely with their shares in
the plaintiff since the brothers were no longer defendants in the BVI litigation.
24 According to the Receivers, they came to know about Article 22 of the

Revised Charter after the BVI litigation had commenced. Soon after this
discovery, the Receivers set the Arbitration in motion by filing a Notice of

Arbitration against the plaintiff with the SIAC on 10 March 2015, relying on
the arbitration agreement in Article 22(2). In its Notice of Arbitration, the
same causes of action pursued in the BVI litigation were raised against the
plaintiff (see [17] above). The same reliefs were sought as well. In its Notice
of Arbitration, the defendant requested the arbitral tribunal to rule on the
question of the Tribunal’s jurisdiction as a preliminary matter in an interim
award, before dealing with the merits of the dispute. The Arbitration was
deemed to have commenced on 12 March 2015.
25 I pause to observe that, broadly speaking, the facts will show that
between March 2015 and March 2016, there were, ostensibly, parallel BVI
litigation and SIAC arbitration proceedings. In March 2016, the BVI litigation
came to an end after the defendant’s claim had been struck out and an appeal
against the discharge of an Interim Injunction was thereby rendered otiose (see
[32] below).
26 Returning to the chronology of events, on 13 March 2015, the

defendant wrote to the plaintiff stating that notwithstanding its challenge to the
validity of the Revised Charter, it accepted that the dispute resolution
provision could nonetheless be valid. The defendant proposed that the BVI
litigation be stayed pending the outcome of the Arbitration, save for its
application for the continuation of the Interim Injunction in support of arbitral
proceedings.
27 On 26 March 2015, the plaintiff applied to the BVI High Court for
summary judgment on the basis that the defendant had no real prospect of
succeeding. The plaintiff applied, in the alternative, for the BVI litigation to be
struck out on the basis that no reasonable ground for the claim had been
disclosed. This striking-out application was then amended on 11 May 2015 to
10

include the argument that the defendant’s claim was time-barred. The
plaintiff’s argument was that the defendant would have been aware or ought to
have been aware of the 2008 Share Transfers on or before the board resolution
on 12 February 2008 which recorded the transfer of shares from the defendant
to the plaintiff. If this was established, the limitation period for the defendant’s
claim would have expired on 11 February 2014 – before the matter was
brought to the BVI courts.
28 On 20 April 2015, the defendant applied for a stay of proceedings in

favour of the Arbitration. The stay application was heard on 18 May 2015, and
the BVI court hearing the application reserved judgment. In the interim, the
plaintiff’s applications for summary judgment, striking out, and discharge of
Interim Injunction were adjourned.
29 Meanwhile, the Arbitration had commenced, and on 19 June 2015, the

Tribunal was appointed. On 20 August 2015, the Tribunal issued its First
Scheduling Directive, asking for submissions from the parties in relation to the
assertion that the defendant had no grounds to bring the Arbitration. The
plaintiff filed its submissions on 9 September 2015, the defendant filed its
reply on 14 October 2015, and the plaintiff replied to the defendant’s reply
submissions on 12 November 2015.
30 On 28 October 2015, the defendant filed a fresh application with the

BVI High Court for a continuation of the Interim Injunction, and alternatively,
for a fresh injunction to be given on similar terms to support the ongoing
Arbitration. On 3 November 2015, the BVI High Court heard the plaintiff’s
earlier application for a discharge of the Interim Injunction. The application
was granted on 20 November 2015 (“the Discharge Order”). Notably, the
defendant did not pursue the application it made on 28 October 2015.
11

31 Instead, on 11 December 2015, the defendant filed an appeal against

the Discharge Order, and applied for the continuation of the Interim Injunction
pending the determination of the defendant’s appeal. On 5 January 2016, the
plaintiff filed a cross-appeal against certain findings made by the BVI High
Court. The appeal against the Discharge Order was heard on 15 January 2016
by the Eastern Caribbean Court of Appeal, and judgment was reserved (see
[32] below for outcome).
32 Earlier, on 19 November 2015, the plaintiff applied for security for

costs against the defendant for the BVI litigation proceedings. This application
was granted on 20 January 2016. The BVI High Court ordered the defendant
to pay US$50,000 into court within 21 days (other payment tranches to
follow), failing which the claim would be struck out. On 11 February 2016,
the defendant applied for an extension of time to make payment for the first
tranche and relief from sanction. It eventually made payment for the first
tranche on 19 February 2016. The defendant’s application on 11 February
2016 for time extension was dismissed on 22 March 2016. The BVI High
Court then struck out the defendant’s claim for non-compliance. Following
this, the plaintiff applied to discharge the Interim Injunction (which was still in
place pending the outcome of the appeal against the Discharge Order). On 12
May 2016, the Eastern Caribbean Court of Appeal granted the plaintiff’s
application for the discharge of the Interim Injunction on grounds that the
appeal had been rendered otiose since the claim had been struck out.
33 On 19 April 2016, the Tribunal issued its Decision on Jurisdiction. The

Tribunal held that it had jurisdiction and ordered the Arbitration to proceed on
the merits of the substantive disputes between the parties pursuant to the
arbitration agreement in Article 22(2). On 9 May 2016, the plaintiff sent a
letter to the Tribunal informing the Tribunal that it wished to apply to the
12

Singapore High Court under s 10(3) of the IAA for a determination of the
Tribunal’s jurisdiction. It also applied to the Tribunal to direct a stay of all
further steps in the Arbitration in the interim. On 19 May 2016, the plaintiff
filed OS 501. On 23 May 2016, the Tribunal rejected the plaintiff’s application
to stay the Arbitration. The plaintiff then applied to the Singapore High Court
by way of Summons No 2885 of 2016 to obtain a stay of the Arbitration
pending this court’s decision on the Tribunal’s jurisdiction. The parties
eventually agreed by consent not to proceed with the Arbitration pending this
court’s decision on OS 501.
Preliminary matters
34 There are a few preliminary matters that are best raised at the outset,
foremost of which ought to be the governing law of the arbitration agreement
because the law of the arbitration agreement applies to the contentions raised
by the plaintiff, which include arguments on the scope, breach and waiver of
Article 22. The second is the plaintiff’s argument that the defendant should not
be allowed to approbate and reprobate – ie, that it should not be allowed to
challenge the validity of the Revised Charter in one breath, and rely on Article
22 in another. The third is the issue of the scope of Article 22(2). And finally,
before transiting to the principal question which I have framed at [2], I will
deal with the question of whether the arbitration agreement is mandatory,
which involves a discussion on what the authoritative version of Article 22 is.
Governing law of the arbitration agreement
35 I now turn briefly to the law governing Article 22, the arbitration
agreement. Normally, a three-stage enquiry is employed to determine the
governing law of arbitration agreements: first, whether an express choice was
made; second, in the absence of an express choice, whether an implied choice
13

was made; and third, where parties had not made any choice, the proper law
would be the law that the arbitration agreement has the closest and most real
connection with: SulAmérica Cia Nacional de Seguros SA and others v Enesa
Engelharia SA and others [2013] 1 WLR 102 (“SulAmérica”) at [9] and [25].
36 In oral submissions made on 6 February 2017, Mr Philip Jeyaretnam

SC (“Mr Jeyaretnam”) accepted that there was no express governing law
clause in the Revised Charter and asserted that Vietnamese law would apply to
the Revised Charter as the Revised Charter was a constituent document of a
Vietnamese company. Counsel did not elaborate, but presumably he had in
mind the parties’ implied choice of the governing law. The question that
remains is what the governing law was for the arbitration agreement in Article
22(2) of the Revised Charter. In my view, the parties had made an implied
choice that it would be Vietnamese law as well.
37 At the outset, I note that courts have adopted divergent approaches to

the issue of the parties’ implied choice of law for the arbitration agreement.
On the one hand, SulAmérica stands for the proposition that there is a
rebuttable presumption that the implied choice would be the expressly chosen
law of the substantive contract (at [26]). On the other hand, in FirstLink
Investments Corp Ltd v GT Payment Pte Ltd and others [2014] SGHCR 12
(“FirstLink”), the Court took the position that in a competition between an
expressly chosen substantive law and the law of the chosen seat of arbitration,
it is the law of the chosen seat that prevails (at [16]).
38 In BCY v BCZ [2016] SGHC 249 (“BCY v BCZ”), Steven Chong J (as
he then was) considered the two competing approaches and preferred
SulAmérica to FirstLink. He found that SulAmérica’s approach was supported
by the weight of authorities and preferable as a matter of policy (at [49]–[65]).
14

In the subsequent decision of Dyna-Jet Pte Ltd v Wilson Taylor Asia Pacific
Pte Ltd [2017] 3 SLR 267 (“Dyna-Jet (HC)”), Vinodh Coomaraswamy J
followed SulAmérica, commenting that it would be “unduly parochial” to
apply Singapore law merely because a stay application was made to a
Singapore court (at [31]). Instead, he found the express choice of the
substantive law to be the parties’ implied choice of law for the arbitration
agreement.
39 Chong J’s endorsement of SulAmérica in BCY v BCZ provides useful

guidance for courts tasked with determining the law governing arbitration
agreements. But in the present case, the Revised Charter does not fit neatly
into the SulAmérica analysis for there was no express provision specifying the
substantive law applicable to the underlying agreement. Instead, there were
references to Vietnamese law in respect of employment matters (Article 27)
and purchase of insurance from a foreign insurer approved under Vietnamese
law (Article 28). Although these provisions do not operate as an express
choice of law for the entire Revised Charter, it is unlikely that that the parties
would intend for different laws to govern different parts of the Revised
Charter, and these provisions therefore indicate that the parties impliedly
chose Vietnamese law for the Revised Charter. Undergirding the SulAmérica
approach is the consideration that “parties intended the arbitration agreement
to be governed by the same system of law as the substantive contract”:
SulAmérica at [25]. Since the parties have chosen Vietnamese law to govern
the Revised Charter, I find that the parties would have impliedly chosen
Vietnamese law for Article 22(2) as well.
40 The fact that the seat of the arbitration is Singapore does not change
my finding. First, it should be noted that BMP and BMO had not expressly
indicated a seat of choice, and that the seat of the Arbitration was presumed to
15

be Singapore in the absence of parties’ agreement by operation of Rule 18.1 of

the SIAC 2013 rules. In this sense, this case is slightly removed from a
scenario where parties had chosen the arbitral seat (this was also the case in
FirstLink). Further, as I have noted above, the stance taken by the Assistant
Registrar in FirstLink has not been followed in subsequent High Court
decisions. Finally, I note that even in FirstLink, the Assistant Registrar had
cautioned that “the determination of the implied proper law ultimately remains
a question of construction; each case will have to turn on its own facts” (at
[16]). I reiterate that the facts of the present case point towards Vietnam law
instead.
41 I pause to note that the Tribunal had cited the decision of Habas Sinai
Ve Tibbi Gazlar Istihsal Endustrisi AS v VSC Steel Company Ltd [2013]
EWHC 4071 (Comm) (“VSC Steel Company”) in its Decision on Jurisdiction.
In that case, Nicholas Hamblen J commented that in the absence of an express
choice of law in the main contract, the applicable law of the arbitration
agreement would be that of the seat (at [103]). However, Hamblen J’s
comment at [103] of VSC Steel Company must be read in light of [101] and
[104] which clarify that his analysis relates to the third stage – ie, the
identification of the law with the closest and most real connection with the
arbitration agreement. Since I find that there was an implied choice made by
the parties, there is no need to proceed to the third stage of enquiry.
42 No evidence was led to prove the content of Vietnamese law even

though Mr Jeyaretnam submitted that Vietnamese law should apply. Both
sides were content to proceed on the basis that Vietnamese law was the same
as Singapore law. As nothing appears to turn on this, I say no more on this
matter.
16

Withdrawal of the defendant’s challenge to the validity of the Revised

Charter
43 In the Statement of Claim filed in the BVI litigation and the Notice of
Arbitration, the Receivers’ position was that after their appointment,
Shareholder 1 was no longer a director of the defendant and he had no
authority to deal with the defendant’s shareholding in the Vietnam Subsidiary.
As such, the Revised Charter was not validly entered into. Before me, it was
strongly argued that the defendant must not be allowed to approbate and
reprobate by invoking Article 22, a provision contained within the Revised
Charter itself. The principle of separability would not save Article 22 because
the very reason for the invalidity of the parties’ underlying agreement – the
lack of authority to enter into the Revised Charter – infected Article 22 as
well.
44 I should mention that it was after Mr Jeyaretnam’s submissions on 6

February 2017 that counsel for the defendant, Ms Yogarajah Yoga Sharmini
(“Ms Sharmini”) informed the court of her instructions not to challenge the
validity of the Revised Charter in OS 501 and in the Arbitration. This change
removes the foundational premise of Mr Jeyaretnam’s reliance on the doctrine
of approbation and reprobation and this issue has now become moot. If,
however, the doctrine of approbation and reprobation was a live issue, there is
merit to Mr Jeyaretnam’s submissions that the defendant’s attack on the
validity of the Revised Charter could not be dissociated from an attack on the
validity of Article 22, the arbitration agreement. His reliance on Premium
Nafta Products Limited and others v Fili Shipping Company Limited and
others [2007] UKHL 40 (“Premium Nafta”) is relevant and persuasive. In that
case, Lord Hoffmann held at [17] that there may be cases in which the ground
upon which the main agreement is invalid is identical with the ground upon
17

which the arbitration agreement is invalid. In such cases, an attack on the

validity of the main agreement is also an attack on the arbitration agreement.
Scope of Article 22(2)
45 As stated, the plaintiff has changed the position it had taken previously
before the Tribunal to now argue in OS 501 that that the claims raised by the
defendant in the Arbitration do not fall within the ambit of Article 22(2). This
is an interesting development because it is inconsistent with the plaintiff’s
arguments on waiver, breach and estoppel (see [3] above). If a dispute fell
outside the scope of the arbitration agreement, how could it be said that a
party, by commencing litigation in respect of that said dispute, would be
breaching or waiving the arbitration agreement? The only way to make sense
of Mr Jeyaretnam’s arguments is that the scope of Article 22(2) is only a
consequent subsidiary question to be explored if there is a finding that there
was a binding arbitration agreement. However, I propose to deal with the
scope of Article 22(2) at the outset because it is a short point that can be
disposed of fairly easily. It was also the approach taken by Mr Jeyaretnam at
the hearing before this court.
46 It is incontrovertible that the plaintiff may raise a different argument at

the de novo hearing before this court reviewing an arbitral tribunal’s decision
on jurisdiction under s 10(3) of the IAA. In PT Tugu Pratama Indonesia v
Magma Nusantara Ltd [2003] 4 SLR(R) 257, Judith Prakash J (as she then
was) heard a similar application under Art 16(3) of the UNCITRAL Model
Law on International Commercial Arbitration. Prakash J held (at [18]) that
“parties are not limited to rehearsing before the court the contentions put
before the tribunal but are entitled to put forward new arguments on the issue
and the court is entitled to consider these” [emphasis added].
18

47 As regards the scope of Article 22(2), the points of contention

essentially relate to: (a) the subject matter of the dispute; (b) the fact that the
Share Transfers predated the Revised Charter; and (c) the fact that the brothers
were not parties to the arbitration agreement.
48 There is nothing to point (c). I will move on to point (a), ie, that the
claims in the Arbitration are unrelated to the Revised Charter, which is an
agreement governing the constitution of the Vietnam Subsidiary and the
parties’ rights as shareholders in respect of the operations of the Vietnam
Subsidiary. The plaintiff’s contention is that the defendant should invoke the
jurisdiction clause contained within the agreements documenting the
impugned Share Transfers instead. The plaintiff further argues that the
defendant did not identify a term or obligation under the Revised Charter
which it alleges was breached when the Share Transfers took place.
49 The present dispute in the Arbitration is between the defendant and the
plaintiff as members of the Vietnam Subsidiary. I accept the defendant’s
contention that the dispute is tied to Article 7 of the Revised Charter, which
sets out the plaintiff’s shareholding of the members of the Vietnam Subsidiary
on the date of the Revised Charter. Article 7 is a clause titled “Charter Capital
– Contribution Capital”. It sets out the Vietnam Subsidiary’s Charter capital
and the respective capital contribution of the parties. Each member to the
Revised Charter held a share of the Vietnam Subsidiary that was proportional
to their capital contribution.
50 In my view, the purpose of the Revised Charter was not only to register
the Vietnam Subsidiary and reflect its new legal status as a LLC, but also to
reflect a joint venture arrangement binding the members of the Vietnam
Subsidiary inter se. This can be gleaned not only from Article 7 but also
19

Article 4 of the Revised Charter – the “Scope of Business” clause which sets
out an extensive list of the company’s objects. As Ian Hewitt notes in Hewitt
on Joint Ventures (Sweet & Maxwell, 5th Ed, 2011) at para 2–45, the principal
documentation for corporate joint ventures typically includes a joint venture
agreement or shareholders’ agreement together with the relevant constitutional
document establishing the joint venture company. Seen in this light, there is a
sufficient nexus between the subject matter of the dispute, ie, share transfers
between members of a joint venture made in breach of and/or fiduciary duties
and the subject matter of the Revised Charter, a document forming part of the
contractual framework of the joint venture. For all these reasons, I find that the
dispute in the Arbitration is related to the Revised Charter and within the
meaning of the phrase “[a]ll arising disputes” in Article 22(2) (see generally
Dalian Hualiang Enterprise Group v Louis Dreyfus Asia Pte Ltd [2005] 4
SLR(R) 646 at [29]; Tjong Very Sumito v Antig Investments Pte Ltd [2009] 4
SLR(R) 732 (“Tjong Very Sumito”) at [23] and [33]).
51 A related observation is the overarching recognition of arbitration as a

form of dispute resolution. In this regard, it is important to bear in mind the
approach of the Singapore courts in construing the scope of arbitration
agreements. As V K Rajah JA commented in Larsen Oil and Gas Pte Ltd v
Petroprod Ltd (in official liquidation in the Cayman Islands and in
compulsory liquidation in Singapore) [2011] 3 SLR 414 (“Larsen Oil”) at
[19], the courts favour the view that arbitration clauses should be generously
construed such that all manner of claims, whether common law or statutory,
should be regarded as falling within their scope unless there is good reason to
conclude otherwise. This broad approach was subsequently affirmed by the
Court of Appeal in Rals International Pte Ltd v Cassa di Risparmio di Parma
e Piacenza SpA [2016] 5 SLR 455 at [30].
20

52 It follows as a matter of construction that the plaintiff’s second

contention (point (b)) − that the first two tranches of Share Transfers (in 1999
and 2007) were transactions before the parties adopted the Revised Charter in
February 2008 and were not disputes arising from the Revised Charter − is
without merit. For one, Article 7 relates to the plaintiff’s total shareholding
registered in its name which has nothing to do with when the majority stake
was acquired. The complaint is that the defendant lost the bulk of its
shareholding in the Vietnam Subsidiary. Such a claim would only have fully
accrued after the Revised Charter was adopted and would come within the
phrase“[a]ll arising disputes” in Article 22(2). Further, the argument that the
scope of an arbitration agreement must necessarily be temporally confined to
claims that accrue post-contractual formation is untenable. I accept the views
expressed by Simon Greenberg, Christopher Kee, and J Romesh Weeramantry
in International Commercial Arbitration: An Asia-Pacific Perspective
(Cambridge University Press, 2011) at para 4.130:
For something to arise out of a contract it was argued that it

must have occurred post-contractual formation. If such a
timing requirement existed then pre-contractual claims would
fall outside the scope of that phrase in an arbitration
agreement. Such an interpretation of an arbitration agreement
would be devoid of common, commercial sense. Where
commercial parties agree to arbitrate, the presumed desire is
for all of their claims – pre-contractual or post-contractual –
arising in any way from that relationship to be decided by
arbitration. It is very unlikely that they would want to be
engaged in a process where some claims relating to a dispute
are resolved by a court and other claims in that dispute are
determined by arbitration. Such an inefficient and unduly
complex process should be avoided. [emphasis added]
53 The plaintiff’s argument that transfers occurring before the Revised

Charter of February 2008 could not logically arise out of the same deserves
further scrutiny. Article 22(2) of the Revised Charter uses the phrase “all
arising disputes”, which could arguably refer to all disputes “arising under”,
21

“arising out of”, “in connection with”, “connected with” or “relating to” the
Revised Charter. In relation to the latter three possibilities, I note the High
Court’s finding in Maniach Pte Ltd v L Capital Jones Ltd and another [2016]
3 SLR 801 that the phrase “connected with” was capacious enough to include
any subject matter with a prima facie connection with the arbitration
agreement, including what did not “arise under” a contract (at [145]). This
finding was undisturbed by the Court of Appeal in L Capital Jones Ltd and
another v Maniach Pte Ltd [2017] 1 SLR 312.
54 In any case, even if the phrase “[a]ll arising disputes” is construed to

include disputes “arising under” or “arising out of” the Revised Charter, these
phrases have been read expansively to cover every dispute except disputes
relating to whether there was even a contract (or Revised Charter in this case)
at all (see Fiona Trust & Holding Corporation and others v Yuri Privalov and
others [2007] EWCA Civ 20 at [18]; David St John Sutton, Judith Gill and
Matthew Gearing, Russell on Arbitration (Sweet & Maxwell, 23rd Ed, 2007)
(“Russell on Arbitration”) at para 2-078).
55 All said, the words “all arising disputes” in Article 22(2) have a wide
ambit and should be liberally construed so as to further the intent that the
disputes should be susceptible to the forum chosen for the resolution of
disputes. In my view, Article 22(2) is wide enough to extend to disputes
between the members that are not directly premised on the rights and duties
created by the Revised Charter. The claims brought by the defendant therefore
fall within the ambit of Article 22(2).
Is the agreement to arbitrate mandatory?
56 Another related matter of concern is the authoritative version of Article
22

22. The determination of the matter will swiftly resolve the question as to
whether the agreement to arbitrate is mandatory or not.
57 The defendant produced an uncertified and unofficial English

translation of a Vietnamese version of Article 22. On the other hand, the
plaintiff produced an English version of Article 22 that is found in the official
Revised Charter lodged with the Vietnamese authorities. That official English
version of Article 22 provides as follows:
Article 22: Disputes settlement

1. All arising disputes shall be first settled through amicable
negotiation among the Parties;
2. If no settlement is reached, the disputes shall be
submitted by any Party for final settlement to Singapore
International Arbitration Centre (“SIAC”) in accordance
with the Rules of laws of SIAC. The award of the
arbitrators is final and binding.
In contrast, the defendant produced an uncertified translated version of the

official Vietnamese version in the English language, and the translation reads:
Article 22: Settlement of Disputes

1. Disputes between the Members of the Company and
between Members with the Company should be firstly
resolved through negotiations and conciliation.
2. In the case the Members cannot negotiate and conciliate,
the dispute may be entered into the Singapore
International Arbitration Center (“SIAC”) for settlement
under the rules of the SIAC. The decision of the arbitrator
shall be final and binding.
58 The main difference between the two versions is in the usage of the
word “shall” meant to impose a mandatory obligation to arbitrate and the
operative word in the defendant’s version that used the more permissive
“may” instead.
23

59 It bears mention that the plaintiff’s version is also identical to an

English translation of the official Vietnamese version of the Revised Charter
certified by a Vietnamese law firm, Gia Linh Law Corporation. The Tribunal
made no finding as to whose version of Article 22 is authoritative. In my view,
the plaintiff’s version is preferred because it is the official version in the
English language lodged with the Vietnamese authorities. Article 33 of the
Revised Charter (both the defendant’s and the plaintiff’s version of Article 33
are similar), an implementing provision which deals with conflict between
“language versions” of clauses:
This Charter includes 6 chapters, 33 articles and shall be

made in five (5) original counterparts in both Vietnamese and
English languages. All these counterparts have the same
validity. In case of any conflict between the two language
versions, the English version shall prevail.
60 Article 33 patently states that in a conflict between the official English

version and the official Vietnamese version of a particular clause, it should be
the English version that prevails. The intent of Article 33 would be defeated if
the defendant’s version – a translation of the official Vietnamese version – is
preferred to the official English version of the Revised Charter merely because
it was translated. I therefore find the plaintiff’s version of Article 22 to be the
authoritative version.
61 I pause to note the significance of this finding. Both parties cited the
Privy Council decision in Anzen Limited and others v Hermes One Limited
[2016] UKPC 1 (“Anzen Limited”). In that case, the Privy Council held that
the silent concomitant of using the words “should” or “shall” is that “neither
party will seek any relief in respect of such disputes in any other forum” (at
[12]). It would therefore be a breach of contract to litigate. However, when
parties choose to use the phrase “any party may submit the dispute to binding
24

arbitration”, these words would be purely permissive, leaving it open to one

party to commence litigation, but giving the other party the option of
submitting the dispute to binding arbitration nonetheless, such option being
exercisable by making an unequivocal request to that effect or by applying for
a corresponding stay (at [34]). Hence, on the defendant’s version of Article
22(2), the commencement of the BVI litigation in and of itself would not be a
contractual breach, let alone a repudiatory breach (see [91] below).
62 In Anzen Limited, WSG Nimbus Pte Ltd v Board of Control for Cricket
in Sri Lanka [2002] 1 SLR(R) 1088 (“WSG Nimbus”) was cited in support of
the position that the word “may” is not to be seen as mandatory (at [30]). It
should be emphasised, however, that Lee Seiu Kin JC (as he then was) in WSG
Nimbus did not think that the word “may” in the arbitration agreement is
merely permissive in meaning– instead he held that a holistic approach ought
to be adopted. He held (at [21]):
In my view, this submission hinges on taking the word “may”

out of the context of cl 19 and, after associating that word
with notions of discretion and a lack of any mandatory
meaning, these notions are then linked with the word
“arbitration” to arrive at the conclusion that there is no
compulsory arbitration clause. But in order to arrive at the
proper construction of cl 19 it is necessary to consider the
provision in its entirety and see how the words relate to one
another to convey the intention of the parties… [emphasis
added]
63 I agree that the meaning of the arbitration agreement or the dispute

resolution clause has to be ascertained by considering the clause in its entirety,
and against its surrounding context. While the choice of “may” or “shall” in
the arbitration agreement is undoubtedly a useful starting point for the
question as to whether arbitration is intended to be the parties’ exclusive
dispute resolution mode of choice, departure from this starting position is
warranted where there is clear indication that parties intended otherwise. The
25

decision by Wayne Martin CJ in Pipeline Services WA Pty Ltd v ATCO Gas

Australia Pty Ltd [2014] WASC 10 (“Pipeline Services”) provides an
illustration of this point. In Pipeline Services, the court held that arbitration
was an exclusive option notwithstanding the fact that the arbitration agreement
in question (cl 25.4 of a contract to install underground pipelines in Yanchep)
contained the phrase “either party may by notice to the other party refer the
dispute to arbitration”. Noting that Clause 25.1(b) of the same contract
provided that “[u]nless a party has complied with this Clause 25 that party
may not commence court proceedings relating to any dispute under this
Agreement”, Martin CJ held that if a party decides not to refer the dispute to
arbitration, it cannot thereafter commence court proceedings relating to that
dispute – arbitration was, in that sense, mandatory (at [66]).
64 Returning to Article 22(2) and the finding that the plaintiff’s version is
authoritative, the starting point is that Article 22(2) is mandatory and exclusive
in the sense that if a party wishes to bring a dispute after negotiations to settle
failed, it has to arbitrate (see Anzen at [12]). Nothing in the Revised Charter or
in the surrounding circumstances suggests otherwise. I am not required to deal
with Article 22(1) since it was not an issue in OS 501.
Is the arbitration agreement inoperative?
65 The contractual right at issue is Article 22(2). The plaintiff’s

contention is that an arbitration agreement may be rendered inoperative if the
right to arbitrate is waived, or where the arbitration agreement is repudiated.
The plaintiff also raised estoppel which is said to have been brought about by
the representation of the defendant communicated to and acted upon by the
plaintiff that the right to arbitrate would not be asserted.
26

Waiver
66 The plaintiff’s contention is that by commencing the BVI litigation, the

defendant adopted a position that was inconsistent with the right to proceed to
arbitration. Between the right to litigate in the BVI High Court and the right to
proceed to arbitration in accordance with Article 22(2), the defendant had
elected for the former and had thereby waived its right to arbitrate. Article
22(2) is therefore inoperative. The plaintiff’s argument is premised solely on
“waiver by election”.
67 Before addressing the parties’ arguments, I start with some

observations on the terms “waiver”, “election”, and “waiver by election” that
were used in their respective submissions. In elucidating these concepts, it will
become apparent that it is not appropriate for the plaintiff to raise the doctrine
of waiver, or as the defendant puts it, the doctrine of waiver is not open to the
plaintiff in the present case.
Election as a response and the element of choice
68 The case of Aero-Gate Pte Ltd v Engen Marine Engineering Pte Ltd
[2013] 4 SLR 409 (“Aero-Gate”) provides a useful starting point. In Aero-
Gate, Coomaraswamy J, citing Sean Wilken QC & Karim Ghaly, The Law of
Waiver, Variation, and Estoppel (Oxford University Press, 3rd Ed, 2012)
(“Wilken & Ghaly”), described waiver as a “voluntary or intentional
relinquishment of a known right, claim or privilege”, an “informed choice
manifested in unequivocal conduct”. Coomaraswamy J also observed that
waiver could be classified into four types (at [39]). One of them is “waiver by
election”.
27

69 For this type of waiver, “waiver” and “election” share an immediate

and intimate link: the consequence of election, if established, is the
abandonment, ie, the waiver, of a right (see Wilken & Ghaly at para 4.01). A
party given a choice between two concurrent inconsistent rights (“X” and “Y”)
waives X by electing Y.
70 The leading authority on waiver by election is Motor Oil Hellas

(Corinth) Refineries SA v Shipping Corporation of India (The
“Kanchenjunga”) [1990] 1 Lloyd’s Rep 391 (“The Kanchenjunga”). Lord
Goff of Chieveley held at 397–398:
It is a commonplace that the expression “waiver” is one which

may, in law, bear different meanings. In particular, it may
refer to a forbearance from exercising a right or to an
abandonment of a right. Here we are concerned with waiver in
the sense of abandonment of a right which arises by virtue of a
party making an election. Election itself is a concept which
may be relevant in more that [sic] one context. In the present
case, we are concerned with an election which may arise in the
context of a binding contract, when a state of affairs comes into
existence in which one party becomes entitled, either under the
terms of the contract or by the general law, to exercise a right,
and he has to decide whether or not to do so. His decision,
being a matter of choice for him, is called in law an election.
Characteristically, this state of affairs arises where the other
party has repudiated the contract or has otherwise committed
a breach of the contract which entitles the innocent party to
bring it to an end, or has made a tender of performance which
does not conform to the terms of the contract. But this is not
necessarily so. [emphasis added]
This holding quoted above was cited with approval in the Court of Appeal
decision of Chai Cher Watt (trading as Chuang Aik Engineering Works) v
SDL Technologies Pte Ltd and another appeal [2012] 1 SLR 152 at [33].
71 There is no election to speak of when there is no choice to be

exercised. There is only election “when a party with knowledge of its rights
chooses between two inconsistent rights, this element of choice being
28

essential” (see Wilken & Ghaly at para 6.04). The elements that must be
satisfied for the doctrine of waiver by election to be invoked are fairly
uncontroversial as enunciated in The Kanchenjunga (at 398):
… where with knowledge of the relevant facts a party has

acted in a manner which is consistent only with his having
chosen one of the two alternative and inconsistent course [sic]
of action then open to him – for example, to determine a
contract or alternatively to affirm it – he is held to have made
his election accordingly… But of course an election need not
be made in this way. It can be communicated to the other
party by words or conduct; though, perhaps because a party
who elects not to exercise a right which has become available
to him is abandoning that right, he will only be held to have
done so if he has so communicated that election to the other
party in clear and unequivocal terms.
72 Wilken & Ghaly also suggests that waiver by election is, strictly
speaking, a response, ie, the waiving party must be put to election by a set of
circumstances, which would typically be present when there is a breach of
contract (at para 4.36). It follows that waiver by election focuses on the
conduct of the innocent party after the wrongdoing party’s breach of contract.
The choice between the two inconsistent rights that arise, by operation of law,
after a contractual breach belongs to the innocent party. From this perspective,
waiver by election is, as a matter of law, rightfully for the wrongdoing party to
assert against the innocent party, and not the other way around (see generally
The Kanchenjunga at 397–398; Aero-Gate at [42]).
73 In the context of arbitration, the doctrine of waiver by election arises

frequently in stay applications – the potential line of argument being that if
one party commenced litigation proceedings in breach of the arbitration
agreement and the counterparty took steps in the litigation, the counterparty
may be said to have waived its right to insist on arbitration, having elected –
by its conduct – to litigate instead (see generally s 6(1) of the IAA; Tjong Very
29

Sumito at [53]). This was an observation made by the Tribunal as well at [116]
of its Decision on Jurisdiction.
74 Significantly, this case is not about an application to stay proceedings.

Instead, the party who initially breached the agreement to arbitrate is now re-
asserting the right to compel the counterparty to arbitrate. As I have earlier
stated, waiver by election is available only when there is an element of choice
and only as a response (typically, in relation to a contractual breach). On the
facts of this case, there is no election to speak of that is available to the
defendant as the party in breach of Article 22(2) since the inconsistent rights
(affirmation or termination after the breach) reside with the innocent party
who is the plaintiff. It also follows that the defendant had never been put to
election.
75 The plaintiff cited Granville Shipping Co v Pegasus Lines Ltd [1996] 2

FCR 853 (“Granville”) in support of its proposition that the defendant’s
commencement of the BVI litigation proceedings amounted to a waiver is
unhelpful. In that case, plaintiff (A) sought to refer a counterclaim to
arbitration after commencing an action in the Federal Court of Canada. The
arbitration agreement in question contained language stipulating a mandatory
obligation to arbitrate. The court noted that plaintiff (A) had, by its own
volition, chosen to litigate and cannot now request that the counterclaim be
sent to arbitration – “[i]n essence, [plaintiff (A)] has waived its right to request
a reference to arbitration” (at [24]). For the reasons stated above, I do not
accept that Granville is correct on this point. In any case, the facts are
dissimilar since plaintiff (A) in Granville did not seek to refer the entire
dispute to arbitration. Given the differences in procedural history, it is difficult
to draw parallels.
30

76 In my judgment, the plaintiff’s argument on waiver by election fails for

the reasons set out above.
77 Mr Jeyaretnam’s principal argument was on waiver by election, but I

note that there can be a unilateral waiver of a right if the right is entirely to the
benefit of the waiving party. Unilateral waiver is referred to as another type of
waiver (see Wilken & Ghaly at para 4.36). To illustrate, the arbitration clause
in Dyna-Jet (HC) can be characterised as a unilateral option to arbitrate, and
the commencement of litigation proceedings could be regarded as a waiver of
that option. The operative words of the relevant arbitration clause are as
follows:
… [i]f no amicable settlement is reached through discussions,

at the election of Dyna-Jet, the dispute may be referred to and
personally settled by means of arbitration proceedings, which
will be conducted under English Law; and held in Singapore.
78 The Court of Appeal in Wilson Taylor Asia Pte Ltd v Dyna-Jet Pte Ltd
[2017] SGCA 32 (“Dyna-Jet (CA)”) agreed with the High Court that the
clause constituted a valid agreement to arbitrate even though the clause
entitled only Dyna-Jet but not Wilson Taylor to compel the other to arbitrate a
dispute. The optionality characteristic of the clause meant that the clause
existed as an option that Dyna-Jet alone could choose to invoke. The obvious
distinction between Dyna-Jet (CA) and the present case is that the defendant
did not enjoy such a unilateral option since Article 22(2) is clearly for the
benefit of the Vietnam Subsidiary and its members or between the members
inter se. What this means is that the contractual right as in the present case
cannot be unilaterally relinquished by one party (ie, the defendant) without the
other party’s consent (ie, the plaintiff’s): AAY v AAZ [2011] 1 SLR 1093 at
[127]. In the absence of mutual consent, non-compliance of the term by one
31

party is tantamount to a breach of contract. This is the issue I will discuss in

the “Repudiation” section below.
The element of knowledge
79 My finding that the doctrine of waiver by election is not open to the

plaintiff disposes of the “waiver” argument. But for the sake of completeness,
I will touch on the element of knowledge in the doctrine seeing that there were
extensive arguments on the defendant’s requisite knowledge of Article 22(2)
at the time it commenced the BVI litigation. I wish to make clear that in
discussing the breach of Article 22(2) in [78] above, the working proposition
proceeded on is that even if one of the parties does not know that the contract
contains the arbitration clause in question or does not understand its
consequences, the party will still be required to arbitrate disputes so long as
there is a binding agreement to arbitrate between them. This perspective is
different and it is to be distinguished from the element of knowledge under the
doctrine of waiver.
80 I start with the standard of knowledge that has to be met for the
doctrine to apply. The plaintiff took the view that either actual knowledge
(including the standard of wilful blindness) or constructive knowledge would
suffice.
81 Actual knowledge, in juxtaposition with constructive knowledge,

refers to a situation where a person “must have known” as opposed to “should
have known”. Actual knowledge” may be shown by using direct evidence, but
it may also be inferred from all the surrounding circumstances: Chwee Kin
Keong v Digilandmall.com Pte Ltd [2005] 1 SLR(R) 502 (“Digilandmall”) at
[41]. The court has to go through a process of reasoning where it considers
32

what a reasonable person, placed in a similar situation, would have known.

Phrases such as “must have known”, “could not reasonably have supposed”
are evidential factors or reasoning processes that the court may rely on. Put
simply, it is only where the circumstances are such that the defendant “must
have known” and not “should have known” will an inference of actual
knowledge be permitted. Further, Nelsonian knowledge – or shutting one’s
eyes to the obvious – can be regarded as actual knowledge too (see
Digilandmall at [35] and [42]). I agree with Ms Sharmini that actual
knowledge and not constructive knowledge is required.
(1) Attribution generally
82 It was argued that the Revised Charter was a public document filed
with the Vietnamese Licensing Authority, and that since the defendant was a
party to the Revised Charter and a shareholder in the Vietnam Subsidiary, the
defendant could not disclaim knowledge of the Revised Charter’s contents.
The plaintiff further argued that since the defendant was no longer challenging
the validity of the Revised Charter, the defendant as a company must be taken
to have known about Article 22 even if the Receivers did not know of Article
22 as claimed. There is nothing to this line of argument simply because as far
as a corporate entity is concerned, it is necessary to point to the knowledge of
a category of persons or an identified person before determining whether, as a
matter of law, that knowledge also counts as the company’s via a process
known as “attribution”. The plaintiff’s argument stops short of identifying
who in the defendant company knew about Article 22 and whose knowledge
should be regarded, as a matter of law, as the defendant’s knowledge.
Obviously, the plaintiff would not point to the board of directors as the former
directors had been replaced by the Receivers much earlier. In the present case,
there was no reference to, let alone reliance on, the identification doctrine
33

(also known as “the directing mind and will” or “alter ego” doctrines) which is
another means by which a person’s knowledge may be attributed to the
company.
83 Besides the identification doctrine, the rules of agency is a common

means by which knowledge of the agent is to be regarded as the knowledge of
the corporate principal. The position is stated in Bowstead & Reynolds on
Agency (Sweet & Maxwell, 20th Ed, 2014) at para 8-207:
The law may impute to a principal knowledge relating to the

subject matter of the agency which the agent acquires while
acting within the scope of his authority.
84 It can be gathered from the thrust of Mr Jeyaretnam’s argument that he

was relying on the rules of agency to attribute knowledge to the Receivers via
what the defendant’s BVI Counsel supposedly knew. Mr Jeyaretnam
contended that the defendant’s BVI Counsel had, in one of her affidavits filed
in support of the defendant’s applications for service out of jurisdiction and an
interim injunction, exhibited, amongst other documents, the Due Diligence
Report and the Revised Charter. In doing so, as a matter of procedural law, the
BVI Counsel would be deemed to know the contents of the exhibits, and in
particular Article 22. The plaintiff relied on the proposition that where a
deponent of an affidavit signs it, he or she is deemed to have signed all the
documents exhibited to it as well (see Jet Holding Ltd v Cooper Cameron
(Singapore) Pte Ltd [2006] 3 SLR(R) 769 at [36] (“Jet Holding”); In re
Hinchliffe [1895] 1 Ch 117 at 120). The BVI Counsel’s affidavit was sworn on
22 July 2014. The BVI litigation proceedings were commenced on that very
same day. The plaintiff submitted that on those facts, the BVI Counsel, and by
extension the defendant, would have had knowledge of Article 22, at the very
latest before it started the BVI litigation.
34

85 The BVI Counsel had filed an affidavit in these proceedings stating

that she had not noticed Article 22 and it was overlooked in the course of
preparing the papers for the BVI litigation. Ms Sharmini urged this court to
accept the evidence of the BVI Counsel. She observed that in written
submissions tendered on 15 September 2014 for the applications for service
out of jurisdiction and interim injunction, the BVI Counsel had stated her
belief that the BVI High Court alone had personal jurisdiction over the
plaintiff. That was her submissions despite the inclusion of the Due Diligence
Report and Revised Charter in one of the supporting affidavits. Ms Sharmini’s
point is that the BVI Counsel, as she had truthfully claimed, was not aware of
Article 22, when she submitted on jurisdiction to the BVI High Court. If she
knew of Article 22, the BVI Counsel would have knowingly misrepresented to
the BVI High Courts what was plainly untrue; and there was really no reason
for her to lie. I agree with Ms Sharmini. I accept the improbability of the BVI
Counsel lying at the expense of her professional reputation. There was no
ostensible motive to lie to begin with. Besides, the probability that the BVI
Counsel could have overlooked Article 22 was reasonable and not far-fetched.
My conclusion is that the BVI Counsel had no actual knowledge of Article 22
at the time the BVI litigation was commenced. The proposition in Jet Holding
is a legal imputation which would satisfy the notion of “constructive
knowledge” but not “actual knowledge”. I have earlier concluded that “actual
knowledge” is required to satisfy the element of knowledge for waiver by
election to apply (see [81] above). The proposition in Jet Holding will not
assist the plaintiff. As stated, it is only where the circumstances are such as to
conclude that the defendant “must have known”, and not “should have
known”, will an inference of actual knowledge be permitted.
35

86 Even if I had arrived at the opposite conclusion that the BVI Counsel
had known all along about Article 22 and had deliberately misrepresented to
the BVI High Court on jurisdiction, it is arguable that the BVI Counsel’s
knowledge of the existence of Article 22 would not be attributed to the
defendant. This is because under the rules of agency, an agent’s
misrepresentation would have been tantamount to an agent’s breach of duty
owed to the principal (see the exception in Re Hampshire Land Company
[1896] 2 Ch 743 and explained in The Dolphina [2012] 1 SLR 992 at [225]–
[229]).This area of law was not covered by the parties in submissions and I do
not intend to say more.
(2) Receivers’ actual knowledge
87 The Receivers have denied any knowledge of the existence of Article

22 and their lawyers had not drawn their attention to Article 22 until well after
the BVI litigation had commenced. According to the Receivers, they learnt
about Article 22 towards the end of February 2015. In response, the plaintiff
argued that “actual knowledge” of Article 22 may be inferred from the overall
circumstances. Specifically, the plaintiff highlighted the instructions given to
IndoChine Law (gleaned from the scope of the service proposal), the stated
purpose in Clause 1.4 of the “Purpose” section of the Due Diligence Report,
and the fact that the Due Diligence Report was only sought after audits
revealed the Share Transfers. The plaintiff therefore submits that the Receivers
must have had knowledge of the Revised Charter from the aforesaid matters.
88 Having regard to the overall evidence and the arguments of the

respective parties based on extrapolations from the Due Diligence Report, I
am still not persuaded by the plaintiff that the Receivers had actual knowledge
of the existence of Article 22 prior to and at the commencement of the BVI
36

litigation. It is evident that IndoChine Law’s advice in Section 6.2 of Part C of

the Due Diligence Report was directed at the unauthorised representative and
that in advising the defendant to sue that person in “the authorized
court/arbitration”, IndoChine Law was not making specific reference to
arbitration under Article 22(2). This view is easily inferred from the fact that
the unauthorised representative in question was none other than Shareholder 1
and he was certainly not a party to the Revised Charter and Article 22. Bearing
in mind that IndoChine Law was asked to advise on Vietnamese law in respect
of the Share Transfers by an unauthorised representative, the IndoChine Law’s
opinion referred to two modes of resolving the dispute over the Share
Transfers, namely, under Vietnamese law the defendant could go to court or
arbitrate the dispute. To this end, as Ms Sharmini submitted, it was a neutral
statement advising on the modes of resolving disputes in Vietnam.
89 Whilst there is some force in the remarks that the Receivers would
have had to study the Due Diligence Report and apprised themselves of the
Revised Charter before instructing lawyers, it seems to me that the Receivers
left the recovery of the shares to their lawyers who appeared to have
overlooked Article 22, and their instructed lawyers did not alert the Receivers
that the dispute with the plaintiff had to be resolved by arbitration in
Singapore until sometime towards the end of February 2015. Above all, BVI
Counsel’s corroboration of the Receivers’ position could not be criticised. I
saw nothing fanciful or suspicious that hinted of behaviour that was lacking in
candour on the part of the BVI Counsel and the Receivers.
90 It must be remembered that the Revised Charter, as a contractual

document, is binding even if one of the parties does not know that the Revised
Charter contains an arbitration clause or does not understand its consequences;
ie, the party will still be required to arbitrate disputes. Most of the plaintiff’s
37

arguments are in the realm of “constructive knowledge” and are not helpful to
the analysis of “actual knowledge” required to invoke the doctrine of waiver
by election. The distinction between the two concepts was not appreciated.
Repudiation
91 The plaintiff’s other contention is that the defendant’s commencement

of the BVI litigation was a repudiatory breach of the arbitration agreement.
There is no longer an agreement to arbitrate since the plaintiff had accepted
the repudiatory breach through its participation in the BVI litigation.
Relevant principles
92 AAY and others v AAZ [2011] 1 SLR 1093 (“AAY v AAZ”) provides a
convenient summary of the principles relating to the repudiation of arbitration
agreements (at [90]):
It is trite law that an arbitration agreement, like any contract,

can be repudiated: see Bremer Vulkan Schiffbau und
Maschinenfabrik v South India Shipping Corporation
Ltd [1981] AC 909 at 980 (“Bremer Vulkan”); Al Thani v Steven
Steel Company Incorporated (28 June 1996) (QB):
… There are statements in Chitty which summarise the
effect of the cases that I have been referred to as
follows.
There is no principle that requires arbitration
proceedings to terminate if a party to the
arbitration resorts to court proceedings nor
does resort to court proceedings by a party of
itself constitute a repudiation of the arbitration
agreement, although it might do so if he
thereby unequivocally demonstrates an
intention to renounce or abandon the
agreement…
38

93 Russell on Arbitration reminds that a breach of the arbitration

agreement is not necessarily repudiatory in nature if there is some explanation
for the breach (at para 2-112).
[2-112] Repudiation by commencing proceedings.

A party may repudiate the arbitration agreement by
commencement of proceedings in court in breach of its terms,
but such breach will only be repudiatory if done in
circumstances that show the party in question no longer
intends to be bound by the agreement to arbitrate. Such an
intention can only be inferred from conduct which is clear and
unequivocal. If there was some reason for the breach, such as
confusion as to the correct course, the court will not infer that
the party bringing the proceedings intended to renounce its
obligation to arbitrate. [emphasis added]
94 The key enquiry, which is relevant to the present case, is whether there
is some explanation for the breaching party’s conduct and if there is, there can
be no inference of an intention to repudiate (see also Dubai Islamic Bank
PJSC v PSI Energy Holding Co BSC [2011] EWHC 1019 (Comm) (“PSI
Energy”)). For repudiation to be established, it must be shown that the party in
breach no longer intends to be bound by the agreement to arbitrate. This is the
first stage of enquiry. A related principle is that the obligation on the parties to
arbitrate remains in force despite a repudiatory breach unless and until the
innocent party communicates, unequivocally, an acceptance of the repudiation
(John Downing v Al Tameer Establishment [2002] EWCA Civ 721
(“Downing”) at [21]; National Navigation Co v Endesa Generacion SA (The
“Wadi Sudr”) [2009] EWHC 196 (Comm) (“The Wadi Sudr”) at [114]).
Whether an unequivocal acceptance of repudiation had been communicated is
the second stage. Plainly, the position of a party issuing proceedings simply to
test whether the defendant would invoke the arbitration agreement or not is
different from that of a party following a repudiatory breach of an agreement
to arbitrate. In Downing, the Court of Appeal looked at the correspondence as
39

a whole in that case and found that the plaintiff, John Downing, had resorted
to court proceedings because of the corporate defendant’s refusal to cooperate
or acknowledge the existence of the arbitration agreement, despite being
invited, amongst other things, to submit its choice of arbitrators. Mark Potter
LJ held that the question of whether the issue and service of proceedings was
an unequivocal acceptance of repudiation depended on the previous
communications of the parties and whether, on an objective construction of the
state of play when proceedings were commenced, it amounted to an
unequivocal communication that the corporate defendant’s earlier repudiatory
conduct had been accepted. On the facts of Downing, Potter LJ found that the
resort to court proceedings was unequivocal acceptance.
95 Returning to the passage in Chitty cited in AAY v AAZ (at [92] above),
it is clear that the act of issuing the court proceedings does not per se
constitute a repudiatory breach of the contract to arbitrate disputes between the
parties.
96 A repudiatory intent should not be lightly inferred (see also The

Mercanaut [1980] 2 Lloyd's Rep 183 (“The Mercanaut”) at 185). Jeremy
Cooke J in BEA Hotels NV v Bellway LLC [2007] EWHC 1363 (Comm)
(“BEA Hotels”) made similar remarks (at [13] and [14]):
13 … It was undisputed that a breach of an arbitration

agreement by bringing other proceedings was only repudiatory
if it was done in circumstances that showed that the party in
question no longer intended to be bound to arbitrate. It was
also agreed that such an intention could not lightly be inferred
and could only be inferred from conduct which was clear and
unequivocal. If there was some other reason for the
breaching of proceedings it would be hard to infer that
the party bringing them intended to renounce its
obligation to arbitrate.
14 Thus, if the conduct of that party in all the
surrounding circumstances did not reveal a clear intention not
40

to be bound by the agreement to refer the claims in question

to arbitration, it could not be said that the arbitration
agreement or reference had been repudiated. If it was clear
that the party intended to pursue the arbitration, again there
could be no repudiation…
[emphasis in bold and italics]
Explanation for the breaching party’s conduct
97 The Receivers’ explanation for the commencement of the BVI

litigation is that it was simply not aware of its obligation to arbitrate having
not been advised of the existence of Article 22 at the time the BVI litigation
started. In addition, Shareholder 1 and Shareholder 2 were not parties to
Article 22. That certain parties to the court proceedings were not parties to the
arbitration agreement was a factor that the court in BEA Hotels considered (see
[98] below), though I accept that BEA Hotels is distinguishable since the
claims pursued in the court and arbitration proceedings in BEA Hotels were
distinct. What BEA Hotels adds to the present analysis is that in examining
whether there was an unequivocal intent to renounce an obligation to arbitrate,
the enquiry as to whether there was some other reason for resorting to court
proceedings is relevant.
98 In BEA Hotels, the plaintiff there had challenged the arbitrator’s

substantive jurisdiction on the basis that the arbitration agreement was
repudiated by the defendant’s commencement of litigation proceedings in the
Tel Aviv national courts after arbitral proceedings had commenced, and that
such repudiation was accepted by letter. Cooke J found that there had been no
repudiation because: (a) the defendant had been “fighting” to have arbitration
for the previous three years, and that it was the claimant that had thwarted
arbitral proceedings by preventing the appointment of an arbitrator; (b) the
court proceedings excluded claims against the claimant which were being
41

pursued in arbitration; and crucially, Cooke J also noted that (c) the parties in
the Israeli court proceedings were not limited to the parties to the arbitration
agreement (at [17]–[25]). The court therefore concluded that there was no
repudiatory intent. Instead, the intention of the defendant was for court
proceedings to complement the existing arbitration.
99 BEA Hotels was subsequently applied in PSI Energy to the question of

whether a jurisdiction clause was repudiated. The claimant in that case had
commenced court proceedings in Bahrain in breach of the jurisdiction clause
in favour of English courts. Noting that the same principles apply for
jurisdiction and arbitration clauses, Jack Beatson J (as then was) found that
there was no clear repudiatory intent as there was some explanation for the
breaching party’s conduct. There were valuable assets in Bahrain that the
claimant wanted to freeze, and the claimant’s Bahraini lawyer had advised the
claimant that the only feasible way to do so was by instituting Bahraini court
proceedings (at [59]).
100 English courts have, in situations where a party had launched litigation
proceedings in breach of an arbitration agreement, found that no repudiatory
intent was evinced when parties were uncertain about the proper forum to
bring their claims and were anxious not to be time barred (see The Mercanaut
at 185); one party was not privy to the jurisdiction regime of the underlying
contract, and evinced an intent to comply once apprised of it (see The Wadi
Sudr at [117]); the writ issued was merely a protective writ, and the party
commencing court proceedings had indicated a continuing intention to be
bound by the arbitration agreement (see The Wadi Sudr at [114]).
101 All in all, the plaintiff here has not established that the defendant’s
commencement of the BVI litigation was conduct consistent with the
42

defendant intent to renounce its obligation to arbitrate. I find that the case on
repudiation is not made out at the first stage of enquiry.
102 At this juncture, it is worth noting that the plaintiff’s case was that the
defendant’s repudiatory intent was evinced solely by the commencement of
the BVI litigation. The defendant, on the other hand, was content with ending
the first stage of analysis for repudiatory breach with the filing of the Notice of
Arbitration. I have earlier explained why the plaintiff’s case fails. In my view,
the defendant’s cut-off point is also wrong. It is imperative to extend the
enquiry beyond the commencement of arbitration because a repudiatory intent
could still be evinced if the defendant had demonstrated an intention to
maintain parallel proceedings in both the BVI courts and in the Arbitration –
my comments earlier on the mandatory nature of Article 22(2) are pertinent in
this regard.
103 That said, a study of the procedural history in both the BVI litigation
and the Arbitration (explained earlier in [25]–[32] above) will reveal that the
defendant had also not shown any intent to repudiate after the Notice of
Arbitration was served. Its conduct remained consistent with its decision to
arbitrate the dispute between the parties despite what may seem to be parallel
court and arbitral proceedings.
104 Notably, after the Arbitration commenced, the defendant sent a letter
dated 13 March 2015 proposing that the BVI litigation be stayed pending the
outcome of the arbitration. The plaintiff did not concur to a stay. Instead, on
26 March 2015, the plaintiff applied for summary judgment and/or to strike
out the action on the bases set out below at [110(d)]. On the other hand, the
defendant filed its application to stay the BVI litigation pending outcome of
the Arbitration on 20 April 2015. It was heard on 18 May 2015 and judgment
43

was reserved. Although the defendant filed an application for an interim

injunction on 28 October 2015 to support the Arbitration, it was not pursued
because during the period between March 2015 and January 2016, the
plaintiff’s adjourned application to discharge the Interim Injunction (filed on 6
March 2015, before the Notice of Arbitration was filed) came up for hearing
on 3 November 2015, and the Discharge Order was made on 20 November
2015.
105 The defendant appealed against the Discharge Order. The plaintiff filed
a cross-appeal on 5 January 2016, the appeal to the Eastern Caribbean Court of
Appeal was heard on 15 January 2016, but judgment was reserved. Eventually,
the BVI litigation came to an end because the defendant did not pay the
security of costs ordered against it on time and the defendant’s claim was
struck out. As such, the appeal against the Discharge Order was rendered
otiose, and consequently, the Interim Injunction was discharged on 12 May
2016 since the claim had been struck out.
106 It is clear from the narrative of the BVI proceedings that steps taken by
the defendant were not contradictory nor inconsistent with the arbitral
proceedings before the Tribunal. This was not a case where the defendant was
maintaining parallel proceedings in breach of the arbitration agreement. After
the BVI court reserved its decision on the defendant’s stay application on 18
May 2015, the parties stepped out of the BVI litigation and concentrated on
the Arbitration instead: the Tribunal was appointed on 19 June 2015 and
issued its First Scheduling Directive on 20 August 2015. The BVI litigation
only came alive again on 19 November 2015 (the date on which the plaintiff
filed an application for security for costs in the BVI litigation) after the parties
had finished filing their submissions on the Tribunal’s jurisdiction on 12
November 2015.
44

107 As the narrative further shows, in the period before and after parties
were engaged in the Arbitration, it was the plaintiff that had taken active steps
in the BVI litigation: from 26 March 2015, the date on which it filed its
application for summary judgment/strike out up to 11 May 2015, the date on
which the plaintiff introduced a time-bar defence; and from its application for
security for costs onwards. In comparison, after the Notice of Arbitration was
served, the defendant applied for a stay of the BVI litigation in favour of the
Arbitration on 20 April 2015 (the application was heard on 18 May 2015, and
the court reserved judgment). The defendant also mounted an appeal against
the Discharge Order on 11 December 2015, but this was also a step in support
of the Arbitration since the Interim Injunction was put in place to freeze the
shareholding interests in the Vietnam Subsidiary.
108 Finally, I would note that even though the BVI litigation took almost a
year to sputter to a stop, a fair amount of time had been spent waiting for the
parties’ respective applications to be heard and/or for a decision.
Acceptance of repudiation
109 I go further to add that had the first stage of the enquiry been
established, the plaintiff would not have been able to satisfy the second stage
of enquiry. My reasons are as follows.
110 The plaintiff had admitted that it was aware of the Article 22 when the
BVI litigation was commenced. Before the Tribunal, the plaintiff also
accepted that the disputes were within the scope of Article 22. Despite this
knowledge of the existence of Article 22 back in 2014, the plaintiff neither
raised Article 22 with the defendant nor notified the defendant that it was
agreeable to litigation instead of arbitration. Such direct notification would
45

have expressly and unequivocally conveyed the plaintiff’s acceptance of the

defendant’s breach. Needless to say, there is plainly a serious hole in the
evidence, and the plaintiff is thus forced to put forward its participation in the
BVI litigation as unequivocal acceptance of the defendant’s purported
repudiation. The following steps in the BVI litigation are relied upon:
(a) Accepting service of the claim form and Statement of Claim in

the BVI litigation (4 November 2014);
(b) Indicating in its Acknowledgment of Service that it would be

filing a substantive defence (4 November 2014);
(c) Filing two applications, affidavits, and submissions seeking the

discharge of the ex parte Interim Injunction (on 26 January 2015 and 6
March 2015 respectively);
(d) Filing an application, affidavit and submissions seeking

summary judgment against the defendant, or alternatively to strike out
the defendant’s claim on its merits (26 March 2015). On top of refuting
the defendant’s claims, the plaintiff’s grounds include averments: (i)
that the Receivers had no authority to bring the dispute in the BVI
courts; (ii) that no transfer of the defendant’s shares were reflected in
the share register; and (iii) that the defendant’s claims were time-
barred;
(e) Opposing the defendant’s application to the BVI High Court

for the BVI litigation to be stayed (18 May 2015); and
(f) Applying for security for costs against the defendant in the BVI
litigation (19 November 2015).
46

111 According to the defendant, not all of the identified steps in the BVI
litigation could be taken into account. The cut-off date for acceptance of
repudiation ought to be the date on which the defendant filed its Notice of
Arbitration, 10 March 2015. As regards the steps taken before 10 March 2015,
the defendant’s position is that the steps could not be construed as unequivocal
acceptance of the repudiation. The defendant also adds that the plaintiff had
challenged the jurisdiction of the BVI courts on the basis that the BVI was not
the natural forum as Malaysia and Vietnam were more appropriate. An
application for a declaration to that effect was filed by the plaintiff on 26
January 2015.
112 I will deal first with the issue of when the cut-off date ought to be for
the examination of whether steps in the BVI proceedings can constitute
acceptance. Although the defendant did not cite any authorities in support of
its assertion that the cut-off date is the date on which the defendant filed the
Notice of Arbitration, it seems logical enough. Arguably, unequivocal
acceptance must be shown prior to the filing of the Notice of Arbitration
because past that point, the defendant was not evincing an unequivocal intent
to renounce its obligation to arbitrate – as I have found in [101] and [103]
above. There would be no repudiatory intent for the plaintiff to accept. I
therefore find that only steps (a) to (c) referred to at [110] above are relevant.
That said, in appropriate cases, the nature of the participation in the judicial
forum by the parties after arbitration has commenced would be relevant to
demonstrate acceptance of the repudiatory breach.
113 The legal position on whether an act constitutes a “step in the

proceedings” is set out in the case of Carona Holdings Pte Ltd and others v
Go Go Delicacy Pte Ltd [2008] 4 SLR(R) 460 (“Carona Holdings”). In that
case, the Court of Appeal held that “step” must be understood in a practical
47

and commonsensical way. A “step” is deemed to have been taken if the

applicant employs court procedures to enable him to defeat or defend those
proceedings on the merits, or if the applicant proceeds, from a procedural
point of view, beyond a mere acknowledgment of service of process and
evinces an unequivocal intention to participate in the court proceedings in
preference to arbitration (at [52] and [55]). In addition, a step is taken if the act
advances the hearing of the matter in court in contrast to one that serves to
smother the action and stop the proceedings dead in its tracks (at [93]).
114 The following excerpt in David Joseph QC and David Foxton QC,
Singapore International Arbitration: Law & Practice (LexisNexis, 2014)
(“Joseph & Foxton”) is also helpful (at p 98):
It is clear that an application for an extension of time to serve

a defence will not constitute a step in the proceedings, nor will
a request in correspondence for particulars of the claim.
Taking defensive action to challenge an interim injunction does
not involve a step in the proceedings (International SOS Pte Ltd
v Overton Mark Harold George [2001] 2 SLR(R) 777 at [6]), and
in considering whether a particular step has this effect, the
emphasis is to be placed on the end of the application and not
on the means. An act done with the intention of preserving the
status quo pending the hearing of a stay application will not be
a step in the proceedings. [emphasis added]
115 I turn now to the BVI litigation. The two brothers and the plaintiff did
not see the BVI High Court as the natural or appropriate forum to determine
the dispute and the first step each took to have the action stopped was to file
an application for a declaration that BVI was forum non conveniens. The
plaintiff’s application would shed light on its earlier acknowledgement of
service of process and marking on the Acknowledgment of Service form.
There is nothing to the plaintiff’s initial marking of the Acknowledgment of
Service form that indicated an intention to file a defence. As stated, no defence
on the merits was ever filed. To explain, a party served with originating
48

process is required to fill up Acknowledgement of Service forms with

questionnaires. On such questionnaire is the question “Do you intend to
defend the claim?”, and the plaintiff ticked the “YES” box without indicating
that it would be making a substantive defence. Clearly, the mere ticking of a
checkbox in an Acknowledgement of Service form cannot be regarded as a
step in the court process (see Carona Holdings at [55]). As held in Carona
Holdings, only acts that advance court proceedings are “steps”. Forum non
conveniens objections are not acts that would advance the BVI proceedings;
rather, they were acts that reject litigation before the BVI High Court as it was
not the natural or appropriate forum to determine the disputes.
116 Finally, the plaintiff’s applications to discharge the interim injunction

do not constitute steps in the proceedings. As the authors of Joseph & Foxton
had opined, citing International SOS Pte Ltd v Overton Mark Harold George
[2001] 2 SLR(R) 777 at [6] (see above at [114]), a defensive challenge of an
interim injunction is not a step in the proceedings. The objective of such a
challenge is to undo the fetters imposed by the interim injunction – not to
advance court proceedings. It cannot be construed to be an unequivocal
intention to participate in the court proceedings in preference to arbitration.
Further, I note that in Delta Reclamation Limited v Premier Waste
Management Limited [2008] EWHC 2579 (QB), John Behrens J had held that
even if court proceedings were launched in breach of an arbitration agreement,
the defence of an application for interlocutory relief, without any further steps
in the action, would not amount to an acceptance of the breach so as to bring
the arbitration agreement to an end (at [35]).
117 All in all, the plaintiff’s participation in the BVI litigation as described
is not demonstrable as an unequivocal acceptance of any purported
repudiation.
49

Estoppel
118 As a separate and alternative challenge to the Tribunal’s jurisdiction,

the plaintiff argues that the defendant is estopped from pursuing the
Arbitration, contending that the defendant, having previously litigated in the
BVI, cannot re-assert the right to arbitrate. I begin with the nature of the
estoppel canvassed by either side.
119 The plaintiff apparently relied on the doctrine of estoppel by

representation whereas the defendant had submitted on the doctrine of
promissory estoppel. The case of Aero-Gate is instructive in resolving this
conceptual misalignment. Coomaraswamy J in Aero-Gate clarified that
estoppel by representation relates to representation of present fact (at [37]). It
operates to prevent the denial of the truth of a representation of fact, thereby
setting up a state of affairs by reference to which the parties’ obligations are to
be governed (see Wilken & Ghaly at para 8.05). In contrast, promissory
estoppel relates to a representation as to future conduct. It relates to a promise
that rights will not be enforced (see Aero-Gate at [37]; Wilken & Ghaly at para
8.05).
120 In its submissions, the plaintiff cited Yokogawa Engineering Asia Pte
Ltd v Transtel Engineering Pte Ltd [2009] 2 SLR(R) 532 (“Yokogawa”),
which was characterised as a case of estoppel by representation (see
Yokogawa at [6]). In that case, the plaintiff had represented to the defendant
that the operative dispute resolution mechanism was arbitration in Singapore
under the Rules of Arbitration of the ICC International Court of Arbitration.
The defendant relied on the plaintiff’s representation and duly commenced
arbitration. The plaintiff was held to be estopped from taking a contrary
position (see Yokogawa at [17]).
50

121 The present case is very different. The plaintiff’s case is that by
commencing the BVI litigation, the defendant had represented that it would
“no longer be relying on the arbitration agreement contained in the Revised
Charter. This is tantamount to a prospective promise and the plaintiff’s
argument is therefore one that is premised on promissory estoppel.
122 However, as mentioned at [119] above, the doctrine is applicable only

in relation to a promise not to enforce legal rights. The authors of Wilken &
Ghaly prefer the term “equitable forbearance” to “promissory estoppel”
because the promise, such as it is, is not to perform but to temporarily halt a
right to expect performance of a particular type from the other party (see para
8.06). Indeed, it has been said that the doctrine of promissory estoppel is
“closely akin” to the doctrine of waiver by election except that waiver requires
knowledge whereas promissory estoppel does not, and promissory estoppel
requires detriment whereas waiver does not (see Wilken & Ghaly at para 8.06).
The Kanchenjunga provides useful guidance (at 399):
There is an important similarity between the two principles,

election and equitable estoppel, in that each requires an
unequivocal representation, perhaps because each may
involve a loss, permanent or temporary, of the relevant party's
rights. But there are important differences as well. …
[E]lection once made is final; it is not dependent upon reliance
on it by the other party. On the other hand, equitable estoppel
requires an unequivocal representation by one party that he will
not insist upon his legal rights against the other party, and
such reliance by the representee as will render it inequitable
for the representor to go back upon his representation. No
question arises of any particular knowledge on the part of the
representor, and the estoppel may be suspensory only.
Furthermore, the representation itself is different in character
in the two cases. The party making his election is
communicating his choice whether or not to exercise a right
which has become available to him. The party to an equitable
estoppel is representing that he will not in future enforce his
legal rights. His representation is therefore in the nature of a
promise which, though unsupported by consideration, can have
51

legal consequences; hence it is sometimes referred to as

promissory estoppel. [emphasis added]
123 The doctrines of waiver by election and estoppel arose in PT First

Media TBK (formerly known as PT Broadband Multimedia TBK) v Astro
Nusantara International BV and others and another appeal [2014] 1 SLR 372
(“Astro”) as well. In Astro, the Court of Appeal dealt with the question of
whether the appellant had waived its objections to the tribunal’s jurisdiction
and joinder of the sixth to eighth respondents by its conduct after an award on
preliminary issues, or alternatively, whether it was estopped from raising these
objections on the same basis. The court found that there were substantial
similarities in both concepts. Both require, as a requisite element, that the
appellant had “made a clear representation that it will forego the right to
challenge the Award on Preliminary Issues” (at [200]).
124 In my view, the defendant’s commencement of the BVI litigation

cannot be characterised as a forbearance or forgoing of any right. Again, this
contrasts with a situation where a party has breached the obligation to arbitrate
by commencing court proceedings, and the innocent party applying to stay
court proceedings may be said to be estopped from asserting its right to insist
on arbitration if it “demonstrates a willingness to seek recourse via the gates
of litigation” (see Tjong Very Sumito at [53]; Carona Holdings at [52]). In
other words, estoppel, like waiver, is an argument that may be raised against a
party seeking to enforce its rights in response to another party’s breach. In
contrast, a party cannot be said to have breached an obligation to arbitrate
under an arbitral agreement, and also estopped from asserting a right to
arbitrate under that same agreement.
125 Even if the doctrine of promissory estoppel is applicable, the elements

of promissory estoppel are not made out (see Aero-Gate at [37]; The
52

Kanchenjunga at 399). The plaintiff’s case on estoppel fails at the first

requirement of a clear and unequivocal promise by the promisor. It must be
borne in mind that while promises may be inferred from conduct, whether
such a promise was made is an objective test of whether a promisee would
reasonably interpret the promisor’s actions as a promise to forbear. There will
only be a clear and unequivocal promise if the alleged promisee interpreting
the conduct of the alleged promisor could not reasonably have arrived at any
other conclusion (see Wilken & Ghaly at paras 8.17 and 8.19). As I have
established, the defendant’s commencement of the BVI litigation could be
explained. One feature of the case was that the two brothers were not party to
Article 22, so court proceedings had to be resorted to for the defendant to get
any redress from them. It would also have made more practical sense for the
defendant to commence proceedings against all of the defendants at one forum
instead of commencing multiple proceedings at the same time. I do not think
that the defendant’s actions amount to a clear and unequivocal promise that it
will never commence arbitration proceedings in Singapore.
126 In addition, the second requirement of reliance on the promise by the

promisee is also not made out. Reliance connotes a change of position. The
promisee must act in a different way to that which it would have done had the
promise not been made (see Wilken & Ghaly at para 8.39). A causative link
must be established between the promise and the conduct exhibited by the
promisee. Even if the promise is not the sole cause of the change of position, it
must “tip the balance” and influence the promisee to act in the way it did (see
Wilken & Ghaly at para 8.40). In the present case, the plaintiff had not pointed
to any change of position. All that the plaintiff has relied on to establish
reliance is that the plaintiff had engaged solicitors in the BVI to participate in
the BVI litigation. At the outset, the plaintiff had regarded the BVI as forum
53

non conveniens. From this viewpoint, there was no reliance because the
plaintiff had not regarded the BVI court as the natural or appropriate forum to
determine the substantive merits. I also do not see the plaintiff’s subsequent
conduct in the BVI litigation after the Notice of Arbitration as a change of
position that stemmed from its earlier reliance of the defendant’s
commencement of the BVI litigation once apprised of it.
127 On the first two requirements, the plaintiff fails on its promissory
estoppel argument.
Conclusion
128 For all the reasons stated above, OS 501 is dismissed with costs.
Belinda Ang Saw Ean

Judge
Philip Antony Jeyaretnam SC, Paras Manohar Lalwani and Chua

Weilin (Dentons Rodyk & Davidson LLP) for the plaintiff;
Yogarajah Yoga Sharmini and Subashini d/o Narayanasamy
(Haridass Ho & Partners) for the defendant;
54

[2017] SGHC 127

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[2017] SGHC 127

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IN THE HIGH COURT OF THE REPUBLIC OF SINGAPORE

[2017] SGHC 127

Originating Summons No 501 of 2016

[Arbitration] — [Arbitral tribunal] — [Jurisdiction]

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THE DISPUTE .................................................................................................3

CHANGES TO THE VIETNAM SUBSIDIARY’S CHARTER .................4

EVENTS LEADING TO THE DUE DILIGENCE REPORT .....................5

THE BVI LITIGATION AND THE ARBITRATION.................................7

PRELIMINARY MATTERS ........................................................................13

IS THE ARBITRATION AGREEMENT INOPERATIVE? ....................26

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[2017] SGHC 127

High Court — Originating Summons No 501 of 2016

26 May 2017 Judgment reserved.

Belinda Ang Saw Ean J:

1 Originating Summons No 501 of 2016 (“OS 501”) is an application

2 Prior to commencing the Arbitration on 12 March 2015, the defendant

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3 Related to the principal question is the enquiry that examines whether

4 Whilst the defendant’s submissions mainly addressed the plaintiff’s

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sufficient to indicate a waiver/election or waiver by election. A deeper enquiry

5 The substantive dispute in the BVI litigation and the Arbitration

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6 The brothers were shareholders in several related companies that were

Changes to the Vietnam Subsidiary’s charter

7 The Vietnam Subsidiary was first incorporated on 30 December 1993,

8 In February 2008, Shareholder 1 (purportedly acting for the

9 The arbitration agreement sought to be invoked in the Arbitration is

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be addressed later in this judgment (see [56] below).

Events leading to the Due Diligence Report

12 On 3 February 2009, IndoChine Law’s proposed scope of service in

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14 Second, Section 6.2 of Part C states, in relation to the transfer of

15 Prior to the appointment of IndoChine Law, the Receivers were

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16 The Receivers commenced the BVI litigation on 22 July 2014, five

The BVI litigation and the Arbitration

17 On 22 July 2014, the defendant commenced the BVI litigation against

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18 In the BVI litigation, the defendant sought the following reliefs. As

19 On 22 July 2014, the defendant made two interlocutory applications.

20 On 4 November 2011, the plaintiff acknowledged service of the Claim

21 All the defendants in the BVI litigation then individually filed

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forum to determine the dispute. Shareholder 2 filed his application on 18

22 On 2 February 2015, the defendant sought leave to discontinue the BVI

23 On 6 March 2015, the plaintiff filed a fresh application to discharge the

24 According to the Receivers, they came to know about Article 22 of the

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26 Returning to the chronology of events, on 13 March 2015, the

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28 On 20 April 2015, the defendant applied for a stay of proceedings in

29 Meanwhile, the Arbitration had commenced, and on 19 June 2015, the

30 On 28 October 2015, the defendant filed a fresh application with the

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31 Instead, on 11 December 2015, the defendant filed an appeal against