Can a party be regarded as having acceded to the jurisdiction of the arbitral tribunal for a particular application made in the arbitration, despite having objected to the jurisdiction of the tribunal over the arbitration as a whole? Apparently so.
DFM v DFL [2024] SGCA 41 concerned a dispute between two business partners, the appellant and the respondent. There was a clause in the agreement between them them which required their disputes to be referred to arbitration under the Dubai International Financial Centre – London Court of International Arbitration (DIFC-LCIA) Rules (para 7). However, the respondent commenced the arbitration in the Dubai International Arbitration Centre (DIAC). A few months prior, the Ruler of Dubai had issued a decree that the DIAC was to replace the DIFC-LCIA.
After reserving his right to do so in the initial stages, the appellant raised a jurisdictional objection in his Statement of Defence filed in the arbitration. By this objection, the appellant contended that the arbitration had been improperly commenced under the DIAC Rules as he never agreed to a DIAC arbitration and consequently the tribunal lacked jurisdiction over the arbitration (para 57(d)).
An application by the respondent for interim relief was pending before the arbitral tribunal at the same time. The relief sought was an order to freeze the assets of the appellant. The appellant opposed the application on its merits, and did not contend that the tribunal had no jurisdiction to deal with that application specifically (paras 37, 56, 59 – 61). Unfortunately for the appellant, the tribunal decided in favour of the respondent and issued a provisional award granting the interim relief sought (para 14).
The respondent subsequently applied for and obtained leave from the Singapore High Court to enforce the provisional award. After being served with the order for leave, the appellant filed an application to set it aside for the reason that the award was issued without jurisdiction on the part of the arbitral tribunal. The High Court dismissed the application, and the appellant appealed to the Court of Appeal (paras 1, 16, 17, 29).
According to the Court of Appeal, it is possible for a party to accede to the jurisdiction of the arbitral tribunal to determine an interim relief application while retaining his challenge to the tribunal’s jurisdiction to deal with the substantive dispute and the rest of the arbitral proceedings. This is so even where that application involves some consideration of the merits of the claim (albeit on a prima facie basis), which was the case here (paras 2, 39, 40).
By opposing the interim relief application on its merits and failing to object to the jurisdiction of the tribunal to deal with that application, the appellant was regarded as having submitted to such jurisdiction. As a result, the appellant cannot later argue that the tribunal had no jurisdiction to make the award for interim relief when the appellant is resisting proceedings to enforce such award. Hence, the setting aside application was rightly dismissed and the appellant lost his appeal.
Incidentally, the jurisdictional objection raised in the Statement of Defence was still pending before the tribunal even up to the time of the decision by the Court of Appeal (para 36).
It is significant to note that a party may submit to arbitral jurisdiction for a particular application but not the arbitration as a whole even though that application is part of the arbitration. It seems that a party can be “half pregnant” after all, if he does not vigilantly maintain his jurisdictional objection throughout the course of the arbitral proceedings.
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