Arbitral Finality – No Backdoor Appeal on Question of Law

    View Author May 2021

    Republic of India v Vedanta Resources plc [2021] SGCA 50

    Is it an abuse of process to seek a court declaration on a question of law answered by the tribunal?

    There are very few ways to challenge a decision of an arbitral tribunal. There is usually no right of appeal. To challenge a decision, there usually must be some error in the process rather than in the decision itself. A breach of procedural fairness is an example.

    In Republic of India v Vedanta Resources plc, a disappointed disputant tried to circumvent that limitation by applying to the court for a declaration on a question of law that the tribunal had answered. The Court of Appeal held that such an application is not allowed under Singapore law.

    The arbitral tribunal held that certain documents could not be produced because they were confidential under Singapore law. The disappointed party then applied to the Singapore High Court for a declaration that the documents were not confidential. In response, the other party argued in the court that the application was an abuse of process. The High Court held that it was not an abuse, but the Court of Appeal held that it was.

    The Court of Appeal held that:

    • Even if the tribunal made an error of law, its decision is final and binding unless there are grounds for appeal or setting aside under the International Arbitration Act or UNCITRAL Model Law.
    • The tribunal is the master of its own procedure. It does not matter that the obligation of confidentiality is a substantive rule of common law; that does not place it within the court’s exclusive purview.
    • A party cannot ask the court abstract questions of law; they must be tied to the facts. Doing so in this case would result in the court answering the identical question answered by the tribunal.
    • It is illegitimate to seek a court judgment to put pressure on the tribunal to get it to reconsider its decision.
    • Disclosure orders are interlocutory in nature, so it was open for India to reapply to the tribunal to reconsider its decision.
    • Indemnity costs were not awarded against India because the High Court (albeit wrongly) held that there was no abuse of process.

    This decision sounds a cautionary note to parties who consider having a “second bite of the cherry” to have their unfavourable tribunal decisions reviewed by a court through creative applications for declaratory relief on a question of law. Such an application constitutes an abuse of process, which may result in indemnity costs.