Non-participating parties cannot challenge arbitral awards on basis the tribunal failed to determine an issue (Singapore Court of Appeal)

The Singapore Court of Appeal (SGCA) has held that non-participating parties cannot challenge arbitral awards on grounds that the tribunal failed to determine an issue.

The respondent entered into an agreement to acquire a franchised enrichment centre (Agreement) from sellers including the applicant. A dispute arose and the respondent commenced arbitration. The applicant did not participate. The tribunal issued a final award finding for the respondent.

The applicant applied to the Singapore High Court (SGHC) to set aside the award arguing, among other things, that he had not received proper notice of the arbitration, and that the arbitrator failed to consider whether the Agreement was supported by consideration (Consideration Issue). The SGHC dismissed the application, finding that the applicant had proper notice and the tribunal implicitly dealt with the Consideration Issue. The applicant appealed.

The SGCA dismissed the appeal, finding:

• The applicant had notice of the arbitration. Proper notice of an arbitration encompasses both actual and deemed notice. Deemed notice is where there is insufficient proof of actual notice and is subject to rebuttal by appropriate evidence of non-receipt. The SGCA found that the applicant had both actual and deemed notice. The respondent sent the arbitration papers to the applicant in accordance with the Agreement's notice provisions. It was no answer to say the papers were served in his absence or that he did not access the relevant email accounts.
• A non-participating party cannot raise an infra petita challenge. The SGCA held that an alleged failure by a tribunal to consider matters put to it (an infra petita challenge) should be treated as a natural justice challenge under section 48(1)(a)(vii) of the Arbitration Act 2001, not under article 34(2)(a)(iii) of the UNCITRAL Model Law. The SGHC was wrong to find that the arbitrator dealt implicitly with the Consideration Issue. However, there was no breach of natural justice. The Consideration Issue was not raised because the applicant chose not to participate. A party that elects not to participate in an arbitration cannot challenge the resulting award on the infra petita ground. That would permit "hedging of the most egregious form". Further, the Consideration Issue lacked any merit, meaning the applicant suffered no prejudice.

Of particular interest is the cautionary note for parties, which, having received notice of an arbitration, elect not to proceed. Notably, they will be unable to challenge the award on the basis a particular issue was not considered.

Case: 

DEM v DEL [2025] SGCA 1 (3 January 2025) (Sundaresh Menon CJ, Steven Chong JCA and Belinda Ang Saw Ean JCA)