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Grounds publishedDecided 2 Sep 2026
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General Division of the High Court

An award stood although the tribunal cited terms a party had not relied on

DWL v DWM

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[2026] SGHC 179Case no. Originating Application No 1311 of 2025

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An award stood although the tribunal cited terms a party had not relied on

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  1. [1] This is an application by [DWL] (“Claimant”) to wholly or partially set aside an arbitral award (“Award”) granted in favour of [DWM] (“Respondent”) in a Singapore-seated arbitration (“Arbitration”), on grounds that the Award was issued either in excess of jurisdiction or a breach of natural justice.

  2. [2] This matter illustrates the difficulties caused when an arbitral tribunal includes reasons for an outcome sought by one party which were not relied on by that party in its submissions. Here, the Claimant agreed to supply certain equipment to the Respondent at a time when some sanctions had been imposed against customers of the Respondent’s nationality, and further sanctions were anticipated, and indeed eventuated. Parties’ agreement (“Contract”) included a detailed provision concerning how parties should respond to sanctions, including in the event of a party’s obligations under the contract being suspended because their performance had become illegal as a result of the introduction of sanctions. A central question in the Arbitration was whether the Claimant was in material breach of this provision, both prior to the Claimant’s suspension of the Contract and after. The period after such suspension would only be relevant if the provision survived such suspension. The tribunal (comprising both the majority and the dissenting arbitrator, who dissented on other aspects) (“Tribunal”) held that the provision did indeed survive, as the Respondent had contended. However, in so holding, the Tribunal referred to two separate contractual provisions that had not been relied on by the Respondent. Moreover, the Tribunal may have misread those other provisions which did not on their face add support to the conclusion reached. Nevertheless, the Tribunal did not expressly reject and seems to have accepted the reason given by the Respondent for the same conclusion, which was simply that the provision must survive suspension of the Contract on any ground given the purpose of the provision and the overall structure of and intention manifested in the Contract.

  3. [3] The question, therefore, as classically formulated by the Court of Appeal in Soh Beng Tee & Co Pte Ltd v Fairmount Development Pte Ltd [2007] 3 SLR(R) 86 (“Soh Beng Tee”) at [65(d)], is whether a reasonable litigant in the position of the Claimant could have foreseen the possibility of reasoning of this type by the Tribunal. Answering this question not only requires close examination of the arbitral record but also depends on how one characterises “reasoning of this type”. That a tribunal in deciding the question of interpretation of a contract would read the contract for itself, including by looking at parts of it not expressly referred to by parties, is probably not merely foreseeable but expected. So long as parties have had the opportunity to make their respective arguments on interpretation, a tribunal need not specifically warn parties that it might approach the question of interpretation of the provision in issue in a way that is not identical to either party’s submissions. What would likely not be foreseeable would be where a tribunal proceeds on a provision or part of a provision different from that which was the subject of argument. In this judgment, I answer this question on the facts of this case along with the other points raised by the Claimant. I begin however with an outline of the facts.

  4. Facts

  5. [4] The parties are companies involved in the energy production industry. The Claimant is an energy technology and equipment supplier, and the Respondent is an energy producer based in Country [X]. In December 2021, parties entered into the Contract for the Claimant to provide the Respondent with equipment to operate an energy production plant in Country [X].

  6. Background to the dispute

  7. [5] Under the Contract, the Respondent was to make payments to the Claimant at designated intervals, known as “payment milestones”, for work done by the Claimant up until that point. Parties further agreed that in conjunction with the first payment milestone (“PM-1”), the Claimant was to provide the Respondent with a Performance Bond and Parent Company Guarantee (“Bond and Guarantee”). Neither party disputes that both the Bond and Guarantee payments were duly made to the Respondent around the time the Contract was entered into.

  8. [6] When parties entered into the Contract, they were aware of an ongoing international sanctions regime in place against Country [X] since 2014. However, it was only shortly after the Contract was executed, that a new series of international sanctions were imposed on Country [X] in February 2022, which began to impact the Claimant’s ability to fulfil its contractual obligations.

  9. [7] In the weeks that followed the imposition of these new sanctions, parties engaged in several negotiations on how to move forward with the execution of the Contract. The impact of these new sanctions on parties’ contractual relationship ultimately unfolded as follows.

  10. (a) From March 2022, several of the Claimant’s subcontractors began refusing to supply the Claimant with key parts for the equipment that was intended to be delivered to the Respondent.

  11. (b) By April 2022, in light of looming concerns that the sanctions would inadvertently continue to impact the Claimant’s ability to perform the Contract in the long run, the Respondent then deliberately refused to pay an invoice that was due at the third payment milestone (“PM-3”). This, the Respondent conceded, was for “commercial” reasons as the Respondent feared that paying the invoice at that stage “would only increase [its] losses”.

  12. (c) It was on the basis of these looming sanctions, loss of subcontractors and the Respondent’s deliberate and sustained non-payment of PM-3 that the Claimant ultimately sought to suspend the Contract, relying on the suspension clauses. The Claimant’s Notice of Suspension was filed on 27 May 2022 and came into effect on 1 June 2022.

  13. (d) Up until this point of suspension, parties were in agreement that under Art 27B of the Contract, the Claimant was obligated to take steps to mitigate the effect of sanctions on its performance of the Contract.

  14. (i) Since parties had entered into the Contract at a time when the issue of sanctions against Country [X] was already a live concern, the Respondent submits that Art 27B was intended as a “roadmap” to guide parties on how they may attempt to continue fulfilling their contractual obligations notwithstanding any newly introduced or prevailing sanctions.

  15. (ii) Parties agree that under Art 27B, the Claimant was obligated to attempt to either: (a) submit licensing applications such that the Claimant may be permitted to continue delivering its equipment under the new sanctions (“Licensing Obligation”); or (b) alter its equipment to comply with the new sanctions (“Alteration Obligation”), subject to whichever course of action elected by the Respondent.

  16. (iii) For instance, as part of its effort to comply with this obligation to mitigate, the Claimant had: (a) submitted up to ten export licensing applications to the authorities by late April 2022; and (b) raised the possibility of altering its equipment packages to avoid being caught by sanctions – although that latter option, in the Claimant’s submission, was rejected by the Respondent.

  17. (e) However, the parties disagreed on whether the Claimant’s suspension of the Contract was valid as well as what the effect of any suspension was on the Claimant’s obligations concerning sanctions. Thus:

  18. (i) On 3 June 2022, the Respondent immediately challenged the validity of the suspension on grounds that it was brought prematurely. Moreover, the Respondent considered that the Claimant was obligated to continue the above mitigation efforts even after the Claimant had suspended the Contract.

  19. (ii) The Claimant, on the other hand, considered that all its obligations under the Contract, including its obligation to mitigate were validly suspended and accordingly, did not take any further steps in mitigation.

  20. (f) On 11 July 2022, the licensing authorities issued a preliminary decision, notifying the Claimant that its previous licensing applications were denied on account of further sanctions levied against Country [X].

  21. (g) On 15 July 2022, just over a month after the Claimant issued its Notice of Suspension, the Respondent issued a Notice of Termination on grounds that the Claimant’s suspended performance of the Contract amounted to a material breach of its obligations therein.

  22. (h) A few weeks after on 4 August 2022, the Claimant wrote to the Respondent to reject its Notice of Termination on grounds that its earlier suspension of the Contract and its performance were justified. Again, the Claimant pointed to the Respondent’s continued non-payment of PM-3, which by this point, was 120 days overdue.

  23. (i) On 25 August 2022, the Claimant issued its own Notice of Termination, citing largely the same grounds that it did in its earlier Notice of Suspension, with a new allegation that the Respondent’s purported termination of the Contract on 15 July 2022 was a repudiatory breach.

  24. The Arbitration

  25. [8] Following this breakdown between the parties, the Respondent commenced arbitration against the Claimant, and a tribunal comprising three arbitrators was appointed. The Arbitration dealt with the claims brought by the Respondent, as well as a counterclaim raised by the Claimant. For clarity, I will continue to refer to parties as they appear in this setting-aside application.

  26. The Respondent’s claim at the Arbitration

  27. [9] At the Arbitration, the Respondent made several claims, only the following of which were central to this application. First, the Respondent submitted that the Claimant had breached Art 27B of the Contract in so far as it had failed to take reasonable steps to either (a) obtain the necessary licensing authorisation; or (b) alter its equipment to comply with new sanctions. Second, that breach was material enough to justify the Respondent’s subsequent termination of the Contract. A portion of the Respondent’s case here rested on the Claimant’s failure to take any action to mitigate the situation concerning sanctions after the Claimant’s purported suspension of the Contract on 1 June 2022. Central to this submission was the Respondent’s view that not only was the Claimant’s purported suspension of the Contract invalid, but it in any event would have had no effect on the Claimant’s “continu[ing]” obligation to mitigate the effect of sanctions.

  28. [10] In response, the Claimant submitted that not only had it not breached Art 27B of the Contract, but any breach that could have been established would not have been material enough to justify the Respondent’s termination of the Contract. In the Claimant’s view, all its obligations under the Contract were validly suspended as of 1 June 2022, including its obligations under Art 27B, such that any inaction thereafter was irrelevant to the Tribunal’s determination. Moreover, the Claimant submitted that it had, in any event, sufficiently complied with Art 27B, citing the numerous licensing applications it had filed to the authorities as well as efforts it had made to attempt to procure alternative subcontractors.

  29. [11] I should note that at the hearing before me, counsel for the Claimant had characterised the Claimant’s submissions at the Arbitration quite differently. Counsel submitted that the Claimant had only argued in the Arbitration that it was not obligated to alter its equipment as it considered that its obligations under Art 27B were disjunctive. Since the Claimant had been allegedly directed by the Respondent to pursue the licensing route, the Claimant had completely not pursued the alteration route in any meaningful capacity. But this, in my view, was not fully borne out by the arbitral record.

  30. [12] Thus, while the parties advanced their submissions on the basis that the Claimant’s obligations under Art 27B were disjunctive, they nevertheless made submissions on both limbs, specifically whether and how each limb was fulfilled or unfulfilled, as their case might be.

  31. [13] Accordingly, the question of whether the Claimant’s obligations under Art 27B were intended to survive the Claimant’s suspension of the Contract was central to both parties’ submissions. This issue arose at several points in the Arbitration and had further led the Tribunal at the final hearing to question both parties on why Art 27B must have been intended to survive or not survive the Claimant’s suspension of the Contract.

  32. [14] The arbitral record, however, shows that neither party provided much, if anything, to the Tribunal in terms of reasoning. What can be found are brief and largely conclusory submissions, as follows:

  33. (a) The Claimant took the view that since one of its grounds for suspension was the Respondent’s non-payment of PM-3, the Claimant could not have been reasonably expected to follow through on obligations to either actively file licensing applications or seek alternative equipment suppliers when they were simply not getting paid.

  34. (b) The Respondent took the view that the obligations under Art 27B must have been intended to survive suspension of the Contract as parties had contracted on the basis of creating a “sanctions-resistant” contractual arrangement. Parties had entered into the Contract in a period when the threat of sanctions being imposed on Country [X] was neither foreign nor fanciful – and in view of protecting their commercial interests, parties had intentionally set out a framework in Art 27B to immunise their Contract from those threats as and when they were expected to occur. That intention, the Respondent submitted, must extend to situations like the present, where the Claimant had purported to suspend the Contract at least in part because of sanctions.

  35. [15] Following the close of oral submissions at the Arbitration, the point did not resurface in the Tribunal’s post-hearing list of questions to the parties.

  36. The Claimant’s counterclaim at the Arbitration

  37. [16] The Claimant counterclaimed for (a) a declaration that it had validly terminated the Contract on 25 August 2022; and (b) an order that the Respondent return the Bond and Guarantee per Art 45A.3 of the Contract.

  38. [17] The Respondent, on the other hand, challenged the counterclaim on grounds that (a) the Claimant’s termination of the Contract was invalid in so far as the Respondent had already terminated the Contract a month earlier on 15 July 2022; and (b) to the extent that the Contract was validly terminated by the Respondent rather than the Claimant, the Claimant was not entitled to a return of the Bond and Guarantee under the Contract.

  39. [18] Indeed, both parties advanced their submissions by adopting an all-or-nothing approach. Moreover, neither made submissions on the terms of the Bond and Guarantee, and the final version of the Guarantee was never adduced before the Tribunal.

  40. The Award

  41. [19] In August 2025, the Tribunal issued its decision, comprising the award issued by two arbitrators (“Majority”) who decided largely in favour of the Respondent (“Award”), and a dissenting opinion of the third arbitrator which instead held in favour of the Claimant.

  42. [20] The Tribunal and the Majority made the following findings, several of which the Claimant now submits were made either in excess of its jurisdiction or in a breach of natural justice.

  43. (a) With respect to whether the Claimant was entitled to suspend the Contract in light of the effects of increasing sanctions and the Respondent’s non-payment of PM-3 – the Tribunal found in favour of the Claimant but only as regards suspension for non-payment.

  44. (b) With respect to whether the Claimant was obligated to continue to mitigate the effects of sanctions under Art 27B, despite its valid suspension of the Contract – the Tribunal found that it was, by reference to two contractual provisions that had never been raised over the course of the Arbitration: Arts 45.6 and 54 of the Contract.

  45. (c) With respect to whether the Claimant then materially breached its obligations under Art 27B such that the Respondent was thereafter entitled to terminate the Contract – the Majority found that:

  46. (i) the Claimant failed to take reasonable steps to alter its equipment to enable work to continue despite the new sanctions regime;

  47. (ii) the Claimant failed to take reasonable steps to put in effective licensing applications to enable works to continue despite the new sanctions regime; and

  48. (iii) in so doing, the Majority considered the Claimant’s conduct from the time the new sanctions were introduced to the time the Contract was ultimately terminated.

  49. (d) With respect to the Claimant’s counterclaim and whether it would be entitled to a return of its Bond and Guarantee – the Majority found that:

  50. (i) the Claimant was not entitled to a return of the Bond and Guarantee since the Contract had been validly terminated by the Respondent, rather than the Claimant, and it was only in the latter situation that parties had agreed that a return may be granted; and

  51. (ii) the Bond and Guarantee were to act as security for the “amount awarded to [the Respondent] in this Award” for the return of the first two payment milestone payments that the Claimant had received.

  52. The parties’ cases

  53. [21] To the extent that the Claimant seeks to set aside the Award either in whole or in part on multiple grounds, I summarise the parties’ main submissions on each point here and expand on parties’ submissions as I consider them in turn in the analysis below.

  54. The Claimant’s case

  55. [22] With respect to its application to set aside the Award in its entirety, the Claimant submits that the Majority’s finding in the main claim – that the Claimant had materially breached its obligations to mitigate the effect of sanctions under Art 27B – should be set aside as it derives from:

  56. (a) findings made in either an excess of jurisdiction or a breach of natural justice when the Tribunal placed undue reliance on Arts 45.6 and 54 of the Contract to find that the obligations under Art 27B survived the Claimant’s suspension of the Contract, even though parties had neither addressed Arts 45.6 or 54 in their submissions nor been given an opportunity to do so;

  57. (b) findings made in an excess of jurisdiction or a breach of natural justice when the Majority applied both the Alteration and Licensing Obligations under Art 27B conjunctively to determine the materiality of the Claimant’s alleged breach, even though neither party had advanced that position in the Arbitration;

  58. (c) findings made in a breach of natural justice when the Majority adopted a “manifestly incoherent” line of reasoning when it considered the Claimant’s conduct post-termination of the Contract to then determine whether the Contract was validly terminated prior; and

  59. (d) the above findings, which when viewed cumulatively, reveal that they were made in breach of natural justice as the Majority appeared to have “closed their minds” and neglected to “apply themselves to the parties’ arguments”.

  60. [23] With respect to the Claimant’s application to set aside the Award in part, the Claimant submits that the Majority’s findings in the counterclaim – that the Bond and Guarantee were not to be returned to the Claimant and instead treated as security for the amounts awarded to the Respondent in the Arbitration – should be set aside as they were derived from findings made either in excess of jurisdiction or a breach of natural justice. This was because the issue concerning the scope of the Bond and Guarantee was never put before the Tribunal, nor asked of parties. Moreover, the documents necessary to interpret their scope were similarly never adduced.

  61. The Respondent’s case

  62. [24] The Respondent challenged each ground to set aside the Award both in whole and in part, making the following principal points:

  63. (a) First, that the overarching policy of minimal curial intervention dictates that the court should be slow to pick apart and set aside an award barring clear and flagrant breaches of the tribunal’s jurisdiction or the rules of natural justice. This, per the Court of Appeal’s decision in BLC v BLB [2014] 4 SLR 79 (“BLC”) at [86], extends to adopting a generous approach to reviewing awards and resisting invitations to “carry out a hypercritical or excessively syntactical analysis” of the awards being challenged before the court. Instead, adopting that generous and proper reading of the Award would reveal that none of the Claimant’s allegations that the Tribunal or Majority had adopted either an unforeseeable or inconsistent position were borne out.

  64. (b) Second, and flowing from the above, for the Claimant to prove a breach of the fair hearing rule, the court must be satisfied that the findings made by the Tribunal or Majority were not only a “dramatic departure” from what parties could have reasonably foreseen from the arbitral record, but that the findings were determinative enough that Claimant suffered real or actual prejudice when it was deprived of the opportunity to address it: CJA v CIZ [2022] 2 SLR 557 (“CJA”) at [72], citing Soh Beng Tee at [65(e)].

  65. (c) Third, that similarly as regards an alleged breach of the fair hearing rule, the test centres on whether the parties were given a reasonable opportunity to present their case, and not whether that opportunity was indeed exercised by the parties. Citing S Mohan J’s decision in Swire Shipping Pte Ltd v Ace Exim Pte Ltd [2024] 5 SLR 706 (“Swire Shipping”) at [91], the Respondent repeatedly emphasised that the courts should refrain from granting setting-aside applications to a party who, armed with the benefit of hindsight, now wishes that it had presented its case at the arbitration differently.

  66. (d) Fourth, that as regards the test for when a tribunal may be said to have exceeded its jurisdiction, tribunals are not strictly bound to select between either party’s submissions where parties adopt diametrically opposing positions. Rather, per the Court of Appeal’s decision in Soh Beng Tee at [65(e)], a tribunal is “perfectly entitled to embrace a middle path” even if that has not been directly raised by parties.

  67. Issues to be determined

  68. [25] To the extent that the Claimant’s submissions were organised more clearly around the different impugned portions of the Award, as opposed to consolidated legal grounds for setting-aside, I considered the application as follows.

  69. [26] The Claimant’s application to set aside the Award in its entirety turns on whether, in deciding that the Claimant had materially breached its contractual obligations:

  70. (a) The Tribunal acted in excess of its jurisdiction or breached the fair hearing rule by relying on contractual provisions neither party had cited in the arbitration proceedings to decide an issue at [6.71]–[6.73] of the Award (“Ground 1”);

  71. (b) The Majority acted in excess of its jurisdiction or breached natural justice by allegedly interpreting and applying a contractual provision differently from how the parties had agreed it ought to be interpreted at [6.37(10)] and [6.52] of the Award (“Ground 2”);

  72. (c) The Majority breached natural justice by adopting a manifestly incoherent and inconsistent chain of reasoning by allegedly relying on post-termination conduct to determine whether the Contract was validly terminated at [6.45(iv)] and [6.49]–[6.52] of the Award (“Ground 3”); and

  73. (d) In the round, the Majority breached natural justice when the effect of all three of the above alleged breaches are considered cumulatively (“Ground 4”).

  74. [27] Alternatively, the Claimant’s application to partially set aside the Award turns instead on whether, in determining the Claimant’s counterclaim in the Arbitration, the Majority acted in excess of its jurisdiction or breached the fair hearing rule by again making findings on an issue that neither party had raised and were “unnecessary” to determining the parties’ dispute at [6.78(1)]–[6.78(3)] of the Award (“Ground 5”).

  75. The law on setting aside an arbitral award

  76. [28] Before setting out my decision on the issues above, I first sketch out the broad legal principles underlying how the court deals with setting-aside applications like the present.

  77. [29] Under s 24 of the International Arbitration Act 2001 (2020 Rev Ed) (“IAA”), the court may set aside an arbitral award if it was made either (a) in excess of the tribunal’s jurisdiction (Art 34(2)(a)(iii) of the UNCITRAL Model Law on International Commercial Arbitration); or (b) in breach of the rules of natural justice in a manner which prejudiced the rights of either party (s 24(b) of the IAA). Throughout its submissions, the Claimant relies on both grounds interchangeably to impugn various portions of the Award. I accordingly set out the precise relevant legal principles where each are engaged in the analysis below. Suffice to say at this stage that the parties broadly agree on and refer to the established tests for setting aside an award under these respective grounds.

  78. [30] With respect to portions of the Award that the Claimant alleges were made in excess of jurisdiction, parties agree that the court adopts a two-stage de novo inquiry: (a) first, the court identifies the matters within the scope of parties’ submission to arbitration; and (b) second, the court determines whether the arbitral award was appropriately limited to such matters or whether it addressed matters outside the scope of submission that were further irrelevant to the issues requiring determination: CBX v CBZ [2022] 1 SLR 47 at [11].

  79. [31] With respect to portions of the Award that the Claimant alleges were made in breach of natural justice, the parties accept that the Claimant must in the course of its submissions identify: (a) the relevant rule of natural justice that was allegedly breached; (b) how that rule was allegedly breached; (c) in what way the breach was connected to the making of the Award; and (d) how the breach caused real or actual prejudice to the Claimant: Soh Beng Tee at [29].

  80. [32] I move now to address each of the Claimant’s alleged grounds for setting aside the Award in turn.

  81. Ground 1: Whether the Tribunal’s reliance on Arts 45.6 and 54 was in excess of jurisdiction or a breach of the fair hearing rule

  82. [33] The Claimant seeks to impugn [6.71]–[6.73] of the Award on grounds that the Tribunal’s findings arising out of the articles cited below both (a) fell outside the scope of the parties’ submission to arbitration, and crucially; and (b) were never brought to the attention of the parties in the Arbitration. Since neither party made submissions on the basis of these articles, the Claimant submits that the Tribunal’s findings as regards those articles and its ultimate decision against the Claimant that arose therefrom should be set aside as these were findings made either in excess of jurisdiction or in breach of the fair hearing rule.

  83. [34] I first set out below the challenged portions of the Award below for reference – making amendments where necessary to identify the parties as they appear in these setting-aside proceedings.

  84. The parties’ cases

  85. [35] For the purposes of this application, it is common ground that:

  86. (a) underlying the parties’ dispute in the Arbitration as to whether the Claimant had materially breached its obligations under Art 27B was an anterior question as to whether those obligations were intended to survive the Claimant’s suspension of the Contract on 1 June 2022;

  87. (b) in resolving that anterior question, the Tribunal had cited Arts 45.6 and 54 of the Contract and decided the Art 27B was intended to survive the Claimant’s suspension of the Contract; and

  88. (c) the Tribunal had cited Arts 45.6 and 54 despite the fact that neither the parties nor the Tribunal had ever raised these articles over the course of the Arbitration – these articles had never featured in the proceedings nor in the list of post-hearing questions to the parties.

  89. [36] What is disputed between the parties, however, is whether the Tribunal’s reference to those articles in these circumstances forms sufficient ground to set aside the Award – be it for being a finding made in excess of jurisdiction or in breach of the fair hearing rule.

  90. The Claimant’s case

  91. [37] In the Claimant’s submission, to the extent that Arts 45.6 and 54 were never raised by parties in the Arbitration, that immediately placed any reliance on those provisions outside the Tribunal’s jurisdiction. Moreover, the Claimant submits that the Tribunal’s decision as to whether Art 27B obligations were intended to survive the Claimant’s suspension of the Contract turned solely on its interpretation and application of Arts 45.6 and 54 – such that it was determinative of the issue and all the more reason parties ought to have been granted an opportunity to address the interpretation of those Articles before the Tribunal. By instead depriving the parties of their right to be heard by failing to put these provisions before the parties and “embark[ing] upon an entirely unforeseeable chain of reasoning”, the Tribunal had breached the fair hearing rule.

  92. [38] What made the Tribunal’s reliance on Arts 45.6 and 54 particularly unforeseeable was because it was clear on its plain reading, in the Claimant’s view, that neither applied to Art 27B. I reproduce the articles below for reference:

  93. [39] Had the Claimant been given the opportunity to address the applicability of these provisions to interpreting Art 27B, the Claimant submits it would have been able to argue that:

  94. (a) First, Art 45.6 applied only where the suspension and termination of the Contract is “in accordance with the provisions of [Art] 45” which sets out parties’ obligations in the event that the Respondent suspends or terminates the Contract. However, the question before the Tribunal was whether Art 27B would survive the Claimant’s suspension of the Contract.

  95. (b) Second, Art 54 applied to Art 27 but should not have been read as applying to Art 27B. Given that Art 54 expressly references the provisions that would survive termination “by number and letter (e.g. Articles 45A, 47A), the reference to Article 27 but not Article 27B shows that the parties intended to exclude Article 27B from the list” [emphasis in original].

  96. [40] Accordingly, the Tribunal having now relied on these provisions despite never putting them before the parties, had caused prejudice to the Claimant as it had been unable to advance those submissions as to why those provisions ought not to apply.

  97. [41] The prejudice faced by the Claimant was deepened by the fact that the Tribunal’s findings on this issue had trickle-down effects on the rest of the Majority’s findings in the Award. Specifically, having concluded on the sole basis of Arts 45.6 and 54 that Art 27B imposed obligations on the Claimant which would survive the Contract’s suspension, the Majority thereafter (a) considered the Claimant’s failure to fulfil those obligations based on facts which occurred after the suspension; which (b) the Majority found amounted to a material breach; which (c) entitled the Respondent to terminate the Contract.

  98. The Respondent’s case

  99. [42] While the Respondent does not contest that the provisions were never expressly put to the parties, the Respondent submits that the Tribunal’s reliance on them flowed reasonably from and were sufficiently connected to parties’ arguments. Further, the Respondent submits that the extent to which the Tribunal relied on Arts 45.6 and 54 to resolve the question of Art 27B’s survivability had been overstated by the Claimant.

  100. [43] During the Arbitration, the Respondent had invited the Tribunal to consider the overarching context and purpose of Art 27B within parties’ wider contractual relationship and this supported its interpretation that Art 27B must have been intended by parties to survive suspension of the Contract. This broader view – that Art 27B was entered into by parties at a time when sanctions were already in place for the purposes of making the Contract sanctions-resistant – was then echoed by the Tribunal in preceding portions of the Award. Accordingly, the Respondent submits that not only was the Tribunal simply adopting the Respondent’s position as argued in the Arbitration to decide that Art 27B survived the Claimant’s termination, but the Tribunal’s reference to Arts 45.6 and 54 was merely meant to supplement the reason given by the Respondent. The Tribunal’s reference to Arts 45.6 and 54 was never determinative of the issue.

  101. [44] Further, the Claimant’s view that Arts 45.6 and 54 were plainly inapplicable to Art 27B was beside the point. The question put before the Tribunal was whether Art 27B ought to survive the Claimant’s suspension of the Contract. In fact, the question of whether the Claimant’s suspension of the Contract operated to “wipe out” the Claimant’s obligations under Art 27B was expressly raised by the Claimant itself. Given that both parties had adduced the full Contract before the Tribunal, it should have been apparent to the Claimant that the Tribunal may answer the question by “deploy[ing] a contractual interpretation chain of reasoning, including by reference to other provisions in the Contract”. It also should have also been particularly apparent to the Claimant from the language of Arts 45.6 and 54 that they were, at the very least, potentially relevant to the Tribunal’s assessment of Art 27B’s survivability. Particularly, Art 54 provided “in no uncertain terms that it sets out ‘Provisions Surviving the Contract’”.

  102. [45] Accordingly, the Claimant’s subsequent failure to raise the inapplicability of Arts 45.6 and 54 during the Arbitration, despite their clear potential applicability to the issue was therefore not the same as being deprived of the right to be heard on the issue. The opportunity had arisen, the Claimant had simply failed to take it. In any event, the Respondent submits that the Claimant did not suffer any real or actual prejudice as a result of the Tribunal’s findings.

  103. My decision

  104. [46] Before I turn to address the substance of the Claimant’s application as regards [6.71]–[6.73], I consider it necessary to deal with a brief preliminary point engaged by both parties. In their submissions, parties disagree on the nature of the findings in [6.71]–[6.73] in relation to the Tribunal’s broader resolution of the dispute. The Respondent submits that [6.71]–[6.73] should be read as supplementary to earlier paragraphs in which the Tribunal had accepted the Respondent’s submission that Art 27B should survive the Claimant’s suspension of the Contract in light of parties’ intention to build a sanctions-resistant contractual agreement. The Claimant disagrees with this characterisation and considers that [6.71]–[6.73] encapsulates the Tribunal’s entire basis for finding that Art 27B survives suspension of the Contract.

  105. [47] In support of this position, the Claimant cites the following paragraphs wherein the Tribunal identifies its reasons for concluding that Art 27B survives suspension, and those were confined solely to [6.71]–[6.72], which rely on Arts 45.6 and 54:

  106. [48] On this point, I do not fully agree with the Claimant. While I accept that Arts 45.6 and 54 feature strongly in the Tribunal’s reasoning, they were not the entire basis for finding that Art 27B survives suspension of the Contract. In particular, the Tribunal agreed at [6.37(1)] with the Respondent that “at the time of the Contract formation, the Parties contemplated the imposition of sanctions, which had been introduced in 2014, and in Article 27B provided a road map imposing obligations on the Parties, which would attempt to save the Contract as much as possible, and protect the Parties relationship”. It was this point about parties’ intention that founded the Respondent’s submission during the Arbitration that Art 27B survived suspension on any ground.

  107. [49] It is clear from the arbitral record that parties had placed the issue of whether Art 27B was intended to survive the Claimant’s suspension of the Contract well within the Tribunal’s jurisdiction and that each was granted an opportunity to advance submissions for and against that proposition. That the Tribunal did not decide the issue exclusively in line with the arguments advanced by parties does not of itself mean that it exceeded its jurisdiction.

  108. [50] In my view, where the issue concerns interpretation of a contract, it is natural and not unexpected for a tribunal to look at the contract as a whole and find support for a conclusion sought by one party from parts of the contract that neither side referred to. Therefore, I answer no to both these questions. I agree with the Respondent that on balance, the Tribunal’s reliance on Arts 45.6 and 54 was neither in excess of its jurisdiction nor a breach of the fair hearing rule.

  109. The Tribunal’s reliance on Arts 45.6 and 54 was not in excess of jurisdiction

  110. [51] With respect to what falls within the scope of a tribunal’s jurisdiction, the Court of Appeal outlined at [38] of CJA that:

  111. [52] In my judgment, the Respondent’s submission that the Tribunal’s reliance on Arts 45.6 and 54 were within the scope of the Arbitration was borne out on two points. First, from the very outset, parties had adduced the entire Contract as evidence before the Tribunal, which was then tasked to determine the meaning, nature and effect of a particular obligation contained in it. Second, and more pertinently, the Tribunal had been invited by the Respondent to make that determination by reference to the entire Contract and the role of Art 27B within it. In other words, I came to the view that the specific reliance placed by the Tribunal on Arts 45.6 and 54 fairly derived from “the totality of what was presented to the tribunal” – this being the evidence before the Tribunal (ie, the Contract) and Respondent’s submissions at the Arbitration: see CJA at [38].

  112. [53] The fact that neither Art 45.6 nor Art 54 ever featured in parties’ submissions or in the questions parties fielded in the Arbitration also had little bearing on whether the findings amounted to an excess of jurisdiction. In WRP Asia Pacific Sdn Bhd v Grant Thornton Singapore Pte Ltd [2025] SGHC 198 (“WRP Asia”), Aidan Xu J considered that even if a particular contractual provision has not been explicitly raised in pleadings, it may nevertheless come within the scope of the parties’ submission to arbitration where it is “clearly intertwined with the broader issue” before the tribunal: WRP Asia at [46] and [48], citing Swire Shipping at [61] and [48]. In this case, the issues before the Tribunal could be broken down as follows:

  113. (a) Before the Tribunal was the ultimate issue of whether the Respondent was entitled to terminate the Contract.

  114. (b) The issue in (a) turned on whether the Claimant had materially breached its obligations under Art 27B.

  115. (c) Anterior to that issue in (b) was what are the relevant facts the Tribunal may consider in deciding whether the Claimant materially breached its obligations under Art 27B. Specifically, were the obligations under Art 27B intended to survive suspension such that the Tribunal may continue to make findings based on the Claimant’s inaction after it had suspended the Contract on 1 June 2022?

  116. (d) In determining the issue in (c), the Respondent had invited the Tribunal to consider Art 27B, particularly as it relates to the wider contractual arrangement between parties.

  117. [54] In my view, the issue in [53(d)] put the rest of the Contract, particularly Arts 45.6 and 54 which concern the various obligations parties agreed would survive one party’s suspension, squarely within the Tribunal’s scope of jurisdiction – regardless of whether the Tribunal was ultimately correct in finding that they applied.

  118. [55] Tribunals are not required to abide slavishly by the pleadings parties put before them in an arbitration in order to stay within the confines of their jurisdiction. Rather, an award may be upheld, and tribunals may be allowed to depart from parties’ pleadings, particularly where the findings were “premised on the fundamental point raised by [a party] in its submissions”: CJA at [59].

  119. [56] Reviewing awards in this light coheres with the Court of Appeal’s decision in CJA, which allowed the appeal against the decision made by the Judge below, holding at [40] that:

  120. [57] I should add that when it comes to the interpretation of contracts, parties would not usually plead specific provisions of the contract as context for the interpretation they are putting forward and would instead set out the interpretation for which they contend. Detailed arguments for that interpretation would be made subsequently and might well refer to other articles of the contract. In the Arbitration, the Respondent put forward an interpretation of Art 27B in its pleadings, that it obliged parties to use best efforts and act in good faith to agree adjustments to the Contract if faced with sanctions, and this specific obligation was raised by the Tribunal in the course of oral submissions and responded to by the Claimant’s counsel.

  121. [58] For the foregoing reasons, I decline to set aside the Award on the basis that the Majority’s findings on Arts 45.6 and 54 were made in excess of jurisdiction.

  122. The Tribunal’s reliance on Arts 45.6 and 54 was not a breach of the fair hearing rule

  123. [59] The strongest way of putting the natural justice or fair hearing challenge in the Claimant’s favour would be that the Respondent’s argument was that Art 27B survived suspension because this followed implicitly from the overall structure and intent of the contract, while the Tribunal relied on two specific provisions, namely Arts 45.6 and 54, as expressly providing for Art 27B’s survival, when neither provision had been referred to in argument or raised to parties.

  124. [60] The fair hearing rule is premised on the foundational principle that parties have a right to be heard and to that end, are given a reasonable opportunity to present their case. Neither party seriously disputes that the Tribunal had to consider whether Art 27B survived the Claimant’s suspension of the Contract. Indeed, I agree with the Respondent that the arbitral record reveals that it was the Claimant themselves who first raised the point by contending that its obligations under Art 27B were “wipe[d] out” immediately upon its suspension of the Contract. In light of this, the Tribunal had given both parties an opportunity at the hearing to make submissions on why each considered that Art 27B survived or did not survive the Claimant’s suspension. The Claimant’s application now succeeds only if I consider that in the circumstances, it was also further incumbent on the Tribunal to (a) alert parties that it was considering an unargued premise for finding that Art 27B survives; and (b) invite parties to make further submissions responsive to the same. In my view, it was not.

  125. [61] On this point, the Respondent had pointed to [65] of the decision issued by Chan Seng Onn J in TMM Division Maritima SA de CV v Pacific Richfield Marine Pte Ltd [2013] 4 SLR 972 to submit that such an invitation would be unnecessary if “an unargued premise flows reasonably from an argued premise”. I agree, but I further considered it particularly helpful to set out Chan J’s holding at [65] in full:

  126. [62] Rather, the Court of Appeal has clarified in Soh Beng Tee at [65(d)]–[65(e)] that a breach of the fair hearing rule would only be made out in exceptionally limited circumstances, specifically it is:

  127. [63] Put another way, a tribunal will only be found to have denied a party a reasonable opportunity to present its case if it adopts a chain of reasoning which dramatically departs from and bears no nexus to parties’ submissions. Otherwise, I align with the position set out by Vinodh Coomaraswamy J at [159] of JVL Agro Industries Ltd v Agritrade International Pte Ltd [2016] 4 SLR 768 that:

  128. [64] In earlier determining whether the Tribunal’s findings were made in excess of its jurisdiction, I considered that the Tribunal’s reliance on Arts 45.6 and 54 fell within the scope of the Arbitration to the extent that the analysis flowed from the Respondent’s submission: see above at [51]–[57]. That applied equally to determining whether the Majority’s chain of reasoning was sufficiently connected to the Respondent’s submissions and thereby reasonably foreseeable to the Claimant such that it had an opportunity to make its case.

  129. [65] The Respondent had invited the Tribunal to review parties’ entire contractual arrangement in considering what parties must have intended in drafting Art 27B at multiple points in the Arbitration. Not only would that have, in my view, placed the rest of the Contract along with its provisions within the express purview of the Tribunal (and thereby, the scope of the Arbitration), but it would have likewise placed the Claimant on reasonable notice that all other provisions in the Contract were now in play before the Tribunal for the purpose of deciding on the meaning and effect of Art 27B.

  130. [66] As regards the question of foreseeability, the Claimant submits that it could not have reasonably foreseen that the Majority would adopt this chain of reasoning as it was plain on the language of Arts 45.6 and 54, in the Claimant’s view, that neither applied to Art 27B: see above at [39]. Indeed, the Respondent also made no vigorous attempt to defend the correctness of the Tribunal’s reliance on those provisions – except to emphasise that a setting-aside application is not a vessel through which a party may attempt to relitigate the merits of a dispute.

  131. [67] To my mind, the fact that Arts 45.6 and 54 were clearly inapplicable to Art 27B not only had no bearing on the question of whether the Tribunal’s reliance on them was foreseeable; if anything, the fact that these provisions (which purport to exhaustively set out the obligations parties intended to survive the Contract) so clearly failed to apply to Art 27B suggests that the opportunity to raise these provisions was all the more open to the Claimant at the Arbitration. It was the Claimant who failed to identify that opportunity and take it as it arose. I expand on these points in turn.

  132. (1) The Majority’s reliance on Arts 45.6 and 54 was reasonably foreseeable

  133. [68] First, on whether the Tribunal’s chain of reasoning was foreseeable. Whether the Claimant ought to have foreseen the Tribunal’s reliance on Arts 45.6 and 54 turns less on whether one could have reasonably foreseen that the Tribunal would decide that the articles apply to Art 27B, but rather on whether the articles were relevant to the question of Art 27B’s survivability. Regardless of whether Arts 45.6 and 54 plainly applied or did not apply to Art 27B was beside the point – the question is solely whether they could have informed the interpretation of Art 27B either way.

  134. [69] In this vein, I agree with the Respondent that the language of Arts 45.6 and 54 would have prima facie suggested that these articles were at least relevant to determining the question of Art 27B’s survivability.

  135. (a) With respect to Art 45.6, even if I were to accept the Claimant’s interpretation that it applies only when it is the Respondent who suspends the Contract, it at the very least sets out the circumstances under which suspension would apply “without relieving [the Claimant] of any of his obligations whatsoever under the [Contract]”.

  136. (b) The same can be said for Art 54 which not only is expressly entitled “Provisions Surviving the Contract” but to the extent that it sets out (potentially even exhaustively) which provisions parties intended to have that effect, it ought to reasonably have been on the Claimant’s radar during the Arbitration.

  137. [70] Accordingly, on the Claimant’s own construction of these provisions, it is my view that Arts 45.6 and 54 were not just tangentially relevant to answering whether Art 27B was intended to survive the Claimant’s suspension. If anything, applying these provisions as the Claimant had argued would favour the Claimant’s interpretation of Art 27B. Namely, the existence of Arts 45.6 and 54 (to the extent that each potentially could be read to have exhaustively set out the obligations parties intended to survive suspension) was in and of itself an opportunity for the Claimant to argue that per the expressio unius est exclusio alterius principle, the Claimant’s Art 27B obligations must therefore have been intended by parties to be extinguished upon the Claimant’s suspension of the Contract.

  138. [71] Indeed, this may well be a point which the Claimant considers as simply bolstering its submission that it was particularly prejudiced by the Tribunal’s failure to put either of the articles before the parties for their submissions. Had the Tribunal drawn the Claimant’s attention to these provisions then certainly, the Claimant would have been able to press the point and could have reasonably convinced the Tribunal otherwise.

  139. [72] But this is where I find the Court of Appeal’s pronouncement in CJA instructive, and this goes to my second point on the adequacy of the opportunity granted to the Claimant to address the point on Art 27B’s survivability.

  140. (2) The Claimant had an adequate opportunity to present its case

  141. [73] As held by Judith Prakash JCA at [75] of CJA “there is a difference between, on the one hand, a party having no opportunity to address a point or his opponent’s case, and a party failing to recognise or take the opportunity which exists; the latter does not involve a breach [emphasis added]” of the fair hearing rule (as contained in s 33(1) of the Arbitration Act 1996 (c 23) (UK)). In my view, this is a case where the Claimant, had it properly considered its case, had all along the opportunity to address the outright inapplicability of these provisions but had, for whatever reason, opted not to. This was not a situation where reference to the provisions would have been anterior to the Claimant’s case or simply an argument that the Claimant could have made merely for completeness. Considering the inapplicability of these provisions would have advanced the Claimant’s case had the Claimant thought to raise it.

  142. [74] This was also not a case where the point was so obscure and remote to the arguments advanced by the parties that it could not possibly have come to the Claimant’s attention but for being raised by the Tribunal. The question at large concerned the interpretation of a contractual provision. I agree with the Respondent that it was entirely foreseeable in the circumstances that that question could have been answered by reference to other provisions within the same contract, particularly where the title of at least one of the provisions was directly relevant to the question at hand.

  143. [75] At the hearing before me, counsel for the Claimant had advanced a further argument on the limited opportunity it had to address this point on Art 27B. Namely, counsel had contended that some consideration should be given to the fact that the point concerning the survivability of Art 27B had purportedly only arisen at an oral hearing before the Tribunal. The point counsel sought to make was that “when things are raised only orally … there is a certain level of imprecision that makes it difficult for [parties]’ to have a chance to respond properly”. I disagree on account of two points.

  144. (a) First, I agree with the Respondent that while the point had never been expressly put to the Claimant prior to the oral hearing before the Tribunal, it was always a latent issue underlying parties’ dispute. From the outset, the Respondent had described the Claimant as having been in “continuous breach of its obligations” under Art 27B of the Contract in its written submissions before the Tribunal. That should have put the Claimant on adequate alert that the point was in contention.

  145. (b) Second, and regardless of the fact that the precise point may have arisen most clearly in an oral hearing – it should be noted that it was the Claimant itself who first expressly floated the issue of Art 27B’s survivability before the Tribunal. The point was not taken by the Respondent, nor was it a point put to the Claimant in passing by the Tribunal. Rather, it was the Claimant, who had on its own accord, put forth its reasons for why its obligations ought to have ended once it had suspended the Contract.

  146. [76] To this end, I reproduce below extracts from two hearing transcripts in the Arbitration which show that it was the Claimant that had prepared to bring the issue concerning Art 27B’s survivability to the Tribunal. In its submissions, the Respondent had only directed me to the transcript of the final hearing in the Arbitration to show that the issue had arisen before the Tribunal and the Claimant had an opportunity to put forward its reasons. However, a closer review of the arbitral record reveals that a similar point had been made by the Respondent months before in an earlier hearing. For clarity, I have amended the extracts to identify parties as they appear in this setting-aside application.

  147. [77] In September 2024, the Respondent made submissions before the Tribunal on the broad nature and purpose of Art 27B and made a further point on how the article was intended to interact with suspensions in the event of sanctions.

  148. [78] Months later in December 2024, the Claimant, appearing before the Tribunal, takes the opportunity to respond.

  149. [79] In response to a further question from the Tribunal, the Claimant then repeated its submissions as to why its obligations under Art 27B should have been extinguished upon suspension of the Contract.

  150. [80] Importantly, a distinction must be drawn between opportunities that a tribunal must give a party, and opportunities that parties themselves open the door to but then fail to exploit and take to its fullest. In my view, the Claimant, having had months to prepare and then having been the one to re-surface this point before the Tribunal, had a fair enough opportunity to consider and set out its reasons as to why its obligations under Art 27B were suspended along with the Contract on 1 June 2022. And to the extent that the Tribunal’s reliance on Arts 45.6 and 54 then flowed from the submissions put forward by the Respondent and were contained within the Contract (as compared to buried in some other less central document in the Arbitration), the Tribunal was not bound to specifically put these two articles before the parties for further submissions.

  151. [81] As to whether this was an adequate opportunity for the Claimant to make its case, the Court of Appeal has held in Phoenixfin Pte Ltd v Convexity Ltd [2022] 2 SLR 23 at [52] that:

  152. [82] In my judgment, the Claimant had an adequate opportunity to make its point at the hearing. The Claimant had, on its own accord raised its point, and upon questioning by the Tribunal further reiterated its position. This was even notwithstanding the Tribunal’s question to the Claimant which indicated its consideration of the Respondent’s view that Art 27B was a “specific sanctions” provision. Counsel for the Claimant had sought to impress upon me at the hearing that its opportunity to make submissions here had been limited because it was arguing exclusively on grounds that the Contract was suspended for the Respondent’s non-payment of PM-3.

  153. [83] I again do not consider that this takes the Claimant’s case very far. For one, this was not borne out on the arbitral record, which shows that the Claimant had advanced its argument on suspension on multiple grounds, including sanctions, force majeure, and illegality in addition to the Respondent’s non-payment. Indeed, its arguments on the survivability of Art 27B were limited to suspension for non-payment, but that, if anything, was on the Claimant’s own election as to how it chose to run its case. The Respondent had, by that point, made its submissions on the limited survivability of Art 27B in the case of sanctions and illegality – it remained for the Claimant to respond accordingly. Again, this was not an instance in which the Claimant was deprived of an opportunity to make its case, but simply one the Claimant opted not to take and now must bear the consequences of: see CJA at [75].

  154. [84] I deal now with a final point made by counsel for the Claimant at the hearing – that the Claimant suffered a breach of the fair hearing rule particularly because the Respondent had not put forward a specific legal basis for which it claimed that Art 27B ought to survive suspension. In the Claimant’s submission, since the default position on suspension is that it would generally operate to suspend all ongoing obligations under the Contract, the burden fell on the Respondent to prove precisely why that suspension operated to the exclusion of Art 27B. The Respondent’s broad reference to the overarching purpose of Art 27B was far too vague to enable the Claimant to know the case it had to respond to. For the Tribunal to have effectively stepped into the shoes of the Respondent to provide a contractual basis on which it decided the issue, and then not put it before the Claimant was accordingly a breach of the fair hearing rule.

  155. [85] I do not agree. Of course, in an ideal situation, it would have been helpful for the Respondent to have more fully fleshed out its case for why Art 27B should have survived suspension of the Contract. But this does not detract from the fact that the Respondent had in the September hearing already put forward a position – based in large part on the broad purpose of Art 27B but also on its contractual interpretation of its “penultimate line” on suspension. In any event, even if the Respondent’s submissions left much to be desired, this would not operate to bar a tribunal from reading the contract as a whole and relying on other parts of it. Especially where they flow reasonably from one party’s submissions – and this applies even if submissions were less than satisfactory to answer the point. More importantly, the context in which the Art 27B submission arose was in connection to the Claimant’s effective defence – that it ought not to be held liable for its failure to act after it had purported to suspend the Contract on 1 June 2022. Having found that the Claimant enjoyed an adequate opportunity to make that submission, I do not consider that a breach of the fair hearing rule can be made out on the facts before me.

  156. Ground 2: Whether the Majority’s interpretation and application of Art 27B was in excess of jurisdiction and a breach of natural justice

  157. [87] Parties agree that both had interpreted Art 27B and advanced their submissions in the Arbitration on the basis that Art 27B imposed disjunctive obligations on the Claimant. In the event of sanctions, the Claimant was to either: (a) alter its equipment to comply with prevailing sanctions; or (b) apply for licenses from the authorities to enable delivery of the equipment.

  158. [88] Indeed, this is borne out by the wording of Art 27B which, in so far as it is relevant, provides that:

  159. [89] The root of the Claimant’s complaint on this ground, however, is that notwithstanding that agreement between parties, the Majority nevertheless:

  160. (a) interpreted Art 27B as imposing conjunctive obligations on the Claimant by “incorrectly” stating that parties had proceeded on a “dual track basis” vis-à-vis Art 27B at [6.37(10)] of the Award; and

  161. (b) thereafter assessed whether breaches of both limbs of Art 27B cumulatively gave rise to a material breach by stating that its findings that the Claimant had materially breached the Licensing Obligation were “subject to the findings” made earlier in relation to the Alteration Obligation at [6.52] of the Award.

  162. [90] I set out below the challenged portions of the Award and highlight the key words the Claimant cites in support of its submission.

  163. The parties’ cases

  164. [91] The Claimant submits that having “charted its own course” by interpreting Art 27B as imposing conjunctive obligations on the Claimant, despite parties’ agreement otherwise, the Majority had exceeded its jurisdiction and breached natural justice. The fact that parties had agreed on the nature of Art 27B (ie, that it imposed disjunctive obligations on the Claimant), meant that the issue now fell outside of the Tribunal’s jurisdiction because the nature of Art 27B was never a dispute put before it. Similarly, to the extent that this was central to the Majority’s finding that the Claimant had materially breached its obligations under Art 27B and neither party disputes that “[n]o notice was given … that the Majority would treat [the Claimant’s] Art 27B obligations as conjunctive”, the Majority had likewise breached the rules on natural justice.

  165. [92] The Respondent disputes the Claimant’s submission on three grounds.

  166. (a) First, that the Majority had not, in fact, interpreted Art 27B conjunctively nor did the Majority apply it as such when considering the question of materiality.

  167. (b) Second, that regardless of parties’ agreed interpretation of Art 27B, it was well-within the scope of the arbitration and entirely foreseeable that the Tribunal would have had to determine the nature of the obligations before assessing whether they had been individually breached.

  168. (c) Third, that the finding had not, in any event, prejudiced the Claimant as the Majority had assessed whether the Claimant had breached each limb of Art 27B and concluded that each breach independently amounted to a material breach.

  169. My decision

  170. [93] On both parties’ submissions, the entirety of the Claimant’s complaint rests on how the findings of the Majority should be interpreted. I would need first to agree with the Claimant that the Majority had applied Art 27B conjunctively. The Claimant’s reading is based on the Majority’s use of the words “dual track basis” to describe parties’ approach to complying with Art 27B, along with the Majority’s finding that the Claimant had materially breached the Licensing Obligation “subject to” the Majority’s findings on the Alteration Obligation. In other words, if I do not agree with the Claimant on how the Award should be read, then there is no reason to address the rest of the Claimant’s submissions advanced on the basis of their reading.

  171. [94] In the round, I decline to set aside the Award as I disagree with the interpretation put forward by the Claimant. Instead, I agree with the Respondent that a proper reading of the Award is that the Majority did not adopt a conjunctive interpretation of Art 27B.

  172. [95] In arriving at its view that the Majority had adopted this interpretation despite parties’ agreement, the Claimant drew chiefly on two phrases in the Award to each ground its submission that the Majority had (a) first, “incorrectly” interpreted its obligations in Art 27B as conjunctive at [6.37(10)]; and (b) second, applied that incorrect interpretation and determined the question of whether the Claimant had materially breached Art 27B by assessing the Claimant’s conduct as regards both limbs of Art 27B cumulatively at [6.52]. I consider each in turn.

  173. The Majority did not interpret Art 27B inconsistently with parties’ submissions

  174. [96] With respect to the first portion of the Award, the Claimant submits that [6.37(10)] reveals that the Majority had adopted an entirely inconsistent interpretation of Art 27B as not only was it clear on the provision’s plain wording that its obligations were disjunctive, but neither party had made submissions suggesting that parties had nevertheless proceeded on such a “dual track basis”.

  175. [97] The Respondent’s counter to the interpretation put forth by the Claimant is twofold. First, that the Majority was not, in fact, interpreting Art 27B. The words “dual track basis” were merely the Majority’s “observation” of parties’ approach to Art 27B, as opposed to a “finding on the nature of [the Claimant’s] Art 27B obligations”. Second, that the Respondent’s competing interpretation is then borne out by the language adopted by the Majority within this paragraph and its placement vis-à-vis the wider Award. Broken down, the Majority did not “use the word ‘finds’” in [6.37(10)], as compared to when it made clear findings on questions of breach in subsequent paragraphs in the Award. And the absence of the word “finds” coheres with the fact that [6.37(10)] appears under the broader heading of “Chronology after Sanction” – where the Majority laid out the facts following the imposition of new sanctions before it turned to decide whether those facts suggest that the Claimant had materially breached its obligations under Art 27B.

  176. [98] I accept the Respondent’s interpretation of the Award. I note the Claimant’s submission that these must have been findings in so far as the main header above [6.37] was “Tribunal Finding”. But the Respondent’s interpretation still characterises it as a finding, but as a finding of fact concerning what the parties did, rather than a finding concerning what their legal obligation was.

  177. [99] Moreover, accepting that the Majority had made a factual finding that parties had proceeded on a “dual track basis” – is also, in fact, consistent with what had been pleaded and argued by parties in the Arbitration. At the hearing before me, counsel for the Claimant argued vigorously for the point that parties could have never proceeded on a “dual track basis” as:

  178. (a) doing so would have been inconsistent with the approach set out in Art 27B and any departure therefrom had to be via a formal amendment to the Contract. Neither party suggests that any such formal amendments were made; and

  179. (b) the Claimant was only to comply with Art 27B via whichever “track” the Respondent had elected to pursue. To the extent that the Respondent had consistently provided in writing that the Claimant was to go under the Licensing Obligation route, the Alteration Obligation was no longer in play.

  180. [100] I accept that this was the Claimant’s primary submission at the Arbitration. However, contrary to what counsel for the Claimant had advanced before me at the hearing, this was not the only way parties had made their submissions. It was clear even from the get-go in the Respondent’s Notice of Arbitration that its claim of breach was based on the Claimant’s simultaneous failure to comply with either obligation under Art 27B.

  181. [101] Further, in the Respondent’s later Statement of Claim in the Arbitration, it likewise stated that it had “also suggested to consider alternative equipment configurations and searching for SANCTIONED COMPONENTS on alternative markets”.

  182. [102] In response, the Claimant asserted that it had “complied with all such obligations, including by seeking to negotiate a modification of the Contract in good faith, by searching for relevant alternatives to the sanctioned items and by using its best efforts to obtain a license [emphasis added]”. The Claimant further set out its full position on both obligations under Art 27B in its Statement of Defence. Finally, even after asserting that it was bound to comply with only the Licensing Obligation (as elected by the Respondent), the Claimant nevertheless pursued the alternative submission that it had also made best efforts to comply with the Alteration Obligation.

  183. [103] In light of the above, there was nothing inconsistent with in the Majority’s finding that parties could be described as having proceeded on a “dual track basis”. The Claimant had on the facts sought to fulfil both its obligations to seek alternative equipment and simultaneously submit licenses for approval. I turn now to consider whether this finding could then be said to have had some bearing on the Majority’s assessment of the materiality of the Claimant’s Art 27B breach.

  184. The Majority did not apply Art 27B inconsistently with parties’ submissions

  185. [104] Again, the Claimant’s submissions on this point turn on the use of the phrase “subject to” in [6.52] of the Award.

  186. [105] In the Claimant’s submission, the phrase “subject to” means that but for the Majority’s earlier finding that the Claimant had breached its Alteration Obligation, it would not have found the Claimant in material breach of Art 27B even if it considered the Claimant in breach of the Licensing Obligation. In short, the Claimant suggests that the Majority here had decided the materiality of the Claimant’s breach of Art 27B “in one breath”. Putting aside the Claimant’s submission that it ought not to have been bound by the Alteration Obligation in the first place, the Claimant submits that this was not a situation wherein the Majority had considered the Claimant in material breach of both the Alteration Obligation and Licensing Obligation independently. The Majority did not conclude, in the Claimant’s view, that it was in material breach of both limbs and therefore certainly in material breach of Art 27B. Rather, based on its inconsistent interpretation of Art 27B above, the Majority had folded the issue into a single strand of analysis and found the Claimant in material breach of Art 27B only when it considered the cumulative effect of the Claimant’s conduct vis-à-vis both limbs of Art 27B.

  187. [106] I disagree with that interpretation of the Award, particularly given that it hinges centrally on the effective nitpicking of a single phrase in the Award. I agree with the Respondent that not only does such a reading this risk reading the Award out of context, but that the court should refrain from encouraging parties to pick apart the precise language adopted by tribunals. The Respondent rightly relies on the Court of Appeal decision in BLC, where the court considered at [86] that the policy of minimal curial intervention demands that courts take a “generous approach” to reviewing awards and should refrain from carrying out a “hypercritical or excessively syntactical analysis of what the arbitrator has written” or “approach an award with a meticulous legal eye endeavouring to pick holes, inconsistencies and faults in awards, with the objective of upsetting or frustrating the process of arbitration”.

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