Justice Belinda Ang granted a limited permanent anti-suit injunction to restrain an ongoing litigation in Maldives in the recent Singaporean High Court case of Hilton International Manage (Maldives) Pvt Ltd v Sun Travels & Tours Pvt Ltd [2018] SGHC 56.

This case presented a peculiar set of facts:-

(a) There was an arbitration proceedings between Hilton International Manage (Maldives) Ptv Ltd (“Plaintiff”) and Sun Travels & Tours Pvt Ltd (“Defendant”) that resulted in 2 awards, Partial Award dated 27.05.2015 and Final Award dated 17.08.2015, in favour of the Plaintiff (collectively, “the Awards”);

(b) Parties were silent on the seat of arbitration and applying the agreed rules, ICC Court of Arbitration being the governing body, decided to seat the arbitration in Singapore;

(c) Following the above, the Defendant filed a civil action in the Maldivian High Court on 16.10.2016 on the same issues raised and argued in the arbitration;

(d) The Defendant had in fact obtained a judgment in the civil suit on 09.03.2017 (“March Judgment”);

(e) The Plaintiff appealed against the March Judgment;

(f) Meanwhile, the Plaintiff’s latest effort to enforce the Awards has failed. The Maldivian court cited the existence of the March Judgment as the reason for the court’s refusal to enforce the Awards;

(g) Following the above, the Plaintiff filed this application before the Singaporean High Court;

(h) The appeal against the March Judgment is still pending before the Maldivian Appellate Court at the time of this application before the Singaporean High Court

It is important to note that at the time of making the application for a permanent anti-suit injunction in the Singaporean High Court, not only had parties “re-litigated” in the Maldivian High Court over the same issues raised and argued in the arbitration (misrepresentation and breach of Management Agreement), but such litigation had in fact reached an advanced stage where the March Judgment was made by the Maldivian High Court and an appeal had been lodged against the said March Judgment.

For completion, the Defendant argued that the Maldivian High Court action “was simply part of the Defendant’s efforts to resist enforcement of the Awards in Maldives, as it was entitled to do, and the plaintiff was simply coming to this court to aid its enforcement of the Awards”.

Singaporean Courts had granted anti-suits injunctions in the past to restrain court proceedings in breach of arbitration agreement (R1 International Pte Ltd v Lonstroff AG [2015] 1 SLR 521 and BC Andaman Co Ltd and others v Xie Ning Yun and another [2017] SGHC 64).

In short, the Singaporean Courts in granting permanent anti-suit injunctions will consider these 4 broad grounds:-

(a) There is a valid arbitration agreement;

(b) The application is made without delay;

(c) The foreign action is not well-advanced;

(d) There is no other reason why the injunction should not be granted.

However, as Justice Belinda Ang noted:-

“The novel issue in the present case is whether the same proposition applies when court proceedings are commenced after the arbitration has concluded and the arbitral award has been issued, or whether such a reach of the arbitration agreement, if any, should be characterized and considered differently”

In addressing the issues, Justice Belinda Ang found that an arbitration agreement brings about a positive obligation and at least, 2 negative obligations:-

(a) The positive obligation is for parties to arbitrate as per the agreement;

(b) The 1st negative obligation is “not to commence court proceedings stemming from an agreement to resolve any disputes by reference to arbitration”;

(c) The 2nd negative obligation is “not to set aside or otherwise attack an arbitral award in jurisdictions other than the seat of the arbitration”.

Applying the 2nd negative obligation, the Defendant’s action in commencing the Maldivian High Court action over the same issues raised and argued in the arbitration, is clearly an attack on the Awards via the Maldivian High Court. Rightfully, such “attack” (via setting aside) should only be taken in the Singaporean High Court, being the seat of the arbitration.

Following from the above, Justice Belinda Ang made the following findings:-

“58          In the present case, I found that the defendant’s Madivian action was squarely a breach of the defendant’s negative obligation not to set aside or challenge the Awards other than through setting aside procedures in accordance with the law of the seat court… The Maldivian enforcement court’s reliance on the March Judgment does not make the Maldivian action a legitimate resistance of the plaintiff’s enforcement efforts; it reinforces the defendant’s illegitimate attempt to challenge the Award. There is no doubt that the defendant’s conduct was not only a breach of the arbitration agreement, but was also vexatious and oppressive, which is a separate ground on which a permanent anti-suit injunction can be granted…”

In view of the advanced stage of the Maldivian proceedings (appeal against the March Judgment), the Singaporean High Court did not grant the Plaintiff’s application for “a typical anti-suit injunction against the defendant to restrain it from commencing or continuing with foreign proceedings against the plaintiff in disputes governed by the arbitration agreement”.

Instead, the Singaporean High Court granted a “limited permanent anti-suit injunction” to “restrain the defendant from inter alia relying on the March Judgment. This order has the effect of an injunction but does not stop the appeal process”.

Justice Belinda Ang also granted a “declaration that the Awards were final, valid and binding on the parties (as the period for setting aside of the Awards had expired), and a declaration that the defendant’s claim in the Maldivian action was in respect of disputes between the plaintiff and defendant that have arisen out of or in connection with the Agreement and any consequential proceedings (including appeals) would be in breach of the arbitration agreement contained in the Agreement”.

Conclusion

This case again reinforces the Singaporean Court’s robust approach in upholding the sanctity of arbitration agreements and the application of the Model Law.

It appears that even in cases where the foreign proceedings are in an advanced stage, the Singaporean Courts are prepared to assist the aggrieved party in upholding the arbitration agreement if the other party had clearly breached the arbitration agreement.

It remains to be seen whether the Malaysian Courts will adopt such position considering our similar legal framework as well as the fact that the Model Law was adopted and incorporated in our Arbitration Act 2005.

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