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5 January, 2017
The Singapore International Arbitration Centre ("SIAC") released the sixth edition of its rules ("SIAC Rules 2016") on 1 August 2016, which seek to increase efficiency and potential cost-savings in the arbitration process. Unless otherwise agreed by the parties, the SIAC Rules 2016 will apply to any arbitration filed with the SIAC after 1 August 2016. In this note, we discuss some of the key changes to the SIAC rules, which are pertinent to the practical and commercial needs of its users.
Early Dismissal of Claims and Defences
A plaintiff in civil litigation proceedings before the Singapore Courts may apply for summary judgment to be entered against a defendant who has no triable defence. Similarly, a defendant may apply to strike out the plaintiff's claim if the claim, amongst other things, does not disclose a reasonable cause of action. This option was not previously available to parties in arbitration proceedings, regardless of their choice of institutional rules.
In an industry first, Rule 29 of the SIAC Rules 2016 provides that a party may, no later than 30 days after the constitution of the Arbitral Tribunal ("Tribunal"), file an application for the early dismissal of claims or defences on the basis that (a) the claims or defences are manifestly without legal merit; or (b) the claims or defences are manifestly outside the jurisdiction of the Tribunal. If the Tribunal allows the application for early dismissal, it then has 60 days from the date of the filing of the application to issue its order or award.
We anticipate that this "early dismissal" process would be most helpful to claimants in disputes pertaining to straightforward debt recovery matters. It will be interesting to observe how Tribunals will determine such applications while ensuring that the parties nonetheless have an opportunity to be heard.
Consolidation of Disputes and Joinder of Parties
Pursuant to Rules 6 and 8 of the SIAC Rules 2016, it is now possible for a claimant to consolidate multiple arbitrations in respect of disputes arising out of or in connection with multiple contracts. This option was not available in the previous editions of the SIAC rules and was clearly provided for in the SIAC Rules 2016, with a view to reduce wasted time, costs, and the risk of inconsistent awards concerning disputes arising out of or in connection with multiple contracts.
Further reflecting the progressive thinking and commercial-mindedness of the SIAC, Rule 7 of the SIAC Rules 2016 now allows a party to an arbitration to apply for a joinder of parties and a non-party to apply to intervene in the arbitration, both before and after the constitution of the Tribunal. The additional party may be joined if it is prima facie bound by the arbitration agreement or if all parties consent to the joinder. In the former scenario, a Tribunal will, at a later stage, make a final determination on whether the additional party should have intervened or been joined in the first place.
Prior to the SIAC Rules 2016, a joinder was only possible if the additional parties were themselves parties to the arbitration agreement and had consented, in writing, to the joinder.
Emergency Arbitrator
SIAC's awareness of the business needs of users for certainty, expedition and cost-efficiency is reflected in the refinements made to the Emergency Arbitrator procedure. Pursuant to Rule 30 read with Schedule 1 of the SIAC Rules 2016, an Emergency Arbitrator will now be appointed within one calendar day (as opposed to one business day under the old rules). Further, the SIAC Rules 2016 now require the Emergency Arbitrator to issue an interim order or Award within 14 days of his or her appointment. Finally, to ensure that fees remain low and cost-effective, the Emergency Arbitrator's fees are no longer dependent on the quantum in dispute but are now fixed at S$25,000.
Conclusion
The aforementioned changes to the SIAC Rules 2016 exemplify SIAC's consciousness of the practical issues encountered by users of its rules. In particular, the introduction of the Early Dismissal of Claims and Defences mechanism demonstrates the SIAC's willingness to make bold and innovative revisions to its rules in an effort to engender greater certainty, efficiency and costs effectiveness in the arbitration process.
For further information, please contact:
Marcus Chow, Partner, Bird & Bird
marcus.chow@twobirds.com
